• |
the Business Combination;
|
• |
the Domestication; and
|
• |
the issuance and sale of 32,500,000 shares of Class A Common Stock for a purchase price of $10.00 per share and an aggregate purchase price of $325.0 million in the PIPE subscription financing pursuant to the Subscription Agreements.
|
• |
the accompanying notes to the unaudited pro forma condensed combined financial information;
|
• |
the historical audited financial statements of Silver Spike as of and for the year ended December 31, 2020 and the related notes, included in the Proxy Statement/Prospectus;
|
• |
the historical audited financial statements of Legacy WMH as of and for the year ended December 31, 2020 and the related notes, included in the Proxy Statement/Prospectus;
|
• |
the historical unaudited financial statements of Silver Spike as of and for the three months ended March 31, 2021 and the related notes, included in the Proxy Statement/Prospectus;
|
• |
the historical unaudited financial statements of Legacy WMH as of and for the three months ended March 31, 2021 and the related notes, included in the Proxy Statement/Prospectus;
|
• |
other information relating to Silver Spike and Legacy WMH contained in the Proxy Statement/Prospectus, including the Merger Agreement and the description of certain terms thereof set forth in the section entitled 'The Business Combination.'
|
• |
Legacy WMH Class A Unit holders, through their ownership of the Class V Common Stock, have the greatest voting interest in the Company with over 50% of the voting interest;
|
• |
Legacy WMH's directors represent the majority of the new board of directors of the Company;
|
• |
Legacy WMH's senior management is the senior management of the Company; and
|
• |
Legacy WMH is the larger entity based on historical operating activity and has the larger employee base.
|
WMH
(Historical)
|
Silver Spike
(Historical)
|
Transaction
Accounting
Adjustments
(Note 2)
|
Pro Forma
Combined
| ||||||||||||||
Assets
| |||||||||||||||||
Cash
|
$
|
19,604
|
$
|
101
|
254,203
|
(a)
|
$
|
104,529
| |||||||||
(8,750
|
)
|
(b)
| |||||||||||||||
(30,345
|
)
|
(c)
| |||||||||||||||
325,000
|
(d)
| ||||||||||||||||
(102
|
)
|
(f)
| |||||||||||||||
(455,182
|
)
|
(l)
| |||||||||||||||
Accounts receivable, net
|
7,553
|
7,553
| |||||||||||||||
Prepaid expenses and other current assets
|
7,344
|
102
|
(3,192
|
)
|
(c)
|
4,254
| |||||||||||
Total current assets
|
34,501
|
203
|
81,632
|
116,336
| |||||||||||||
Marketable securities held in Trust Account
|
-
|
254,203
|
(254,203
|
)
|
(a)
|
-
| |||||||||||
Property and equipment, net
|
6,892
|
6,892
| |||||||||||||||
Goodwill
|
3,961
|
3,961
| |||||||||||||||
Intangible assets, net
|
4,280
|
4,280
| |||||||||||||||
Right of use assets
|
42,113
|
42,113
| |||||||||||||||
Deferred tax asset
|
-
|
157,104
|
(j)
|
157,104
| |||||||||||||
Other assets
|
3,874
|
3,874
| |||||||||||||||
Total assets
|
$
|
95,621
|
$
|
254,406
|
$
|
(15,467
|
)
|
$
|
334,560
| ||||||||
Liabilities
| |||||||||||||||||
Accounts payable and accrued expenses
|
$
|
13,496
|
$
|
3,549
|
$
|
(3,659
|
)
|
(c)
|
$
|
13,386
| |||||||
Deferred revenue
|
6,189
|
6,189
| |||||||||||||||
Operating lease liabilities, current portion
|
4,884
|
4,884
| |||||||||||||||
Notes payable to members, current portion
|
205
|
205
| |||||||||||||||
Promissory note - related party
|
-
|
200
|
200
| ||||||||||||||
Total current liabilities
|
24,774
|
3,749
|
(3,659
|
)
|
24,864
| ||||||||||||
Operating lease liabilities, non-current portion
|
43,558
|
43,558
| |||||||||||||||
Other long-term liabilities
|
906
|
906
| |||||||||||||||
Long-term payable under Tax Receivable Agreement
|
-
|
133,538
|
(j)
|
133,538
| |||||||||||||
Warrant liability
|
-
|
141,900
|
141,900
| ||||||||||||||
Deferred underwriting fee payable
|
-
|
8,750
|
(8,750
|
)
|
(b)
|
-
| |||||||||||
Total liabilities
|
69,238
|
154,399
|
121,129
|
344,766
| |||||||||||||
Commitments and contingencies
| |||||||||||||||||
Class A ordinary shares subject to possible redemptions
|
95,006
|
(95,006
|
)
|
(e)
|
-
| ||||||||||||
Stockholders' equity (deficit)/ Members' equity
| |||||||||||||||||
Preferred stock
|
-
| ||||||||||||||||
Ordinary shares
| |||||||||||||||||
Class A
|
2
|
1
|
(e)
|
-
| |||||||||||||
-
|
(f)
| ||||||||||||||||
(3
|
)
|
(g)
| |||||||||||||||
Class B
|
1
|
(1
|
)
|
(g)
|
-
| ||||||||||||
Common stock
| |||||||||||||||||
Class A
|
3
|
(d)
|
7
| ||||||||||||||
4
|
(g)
| ||||||||||||||||
Class V
|
7
|
(i)
|
7
| ||||||||||||||
Members' units
|
18,809
|
(18,809
|
)
|
(l)
|
-
| ||||||||||||
Additional paid in capital
|
130,948
|
(26,908
|
)
|
(c)
|
(3,337
|
)
| |||||||||||
324,997
|
(d)
| ||||||||||||||||
95,005
|
(e)
| ||||||||||||||||
(102
|
)
|
(f)
| |||||||||||||||
(125,950
|
)
|
(h)
| |||||||||||||||
(7
|
)
|
(i)
| |||||||||||||||
23,566
|
(j)
| ||||||||||||||||
13,200
|
(k)
| ||||||||||||||||
(455,182
|
)
|
(l)
| |||||||||||||||
17,096
|
(l)
| ||||||||||||||||
Retained earnings (accumulated deficit)
|
7,574
|
(125,950
|
)
|
125,950
|
(h)
|
(1,034
|
)
| ||||||||||
(2,970
|
)
|
(c)
| |||||||||||||||
(13,200
|
)
|
(k)
| |||||||||||||||
7,562
|
(l)
| ||||||||||||||||
Total stockholders' equity (deficit) attributable to common
shareholders / members' equity
|
26,383
|
5,001
|
(35,741
|
)
|
(4,357
|
)
| |||||||||||
Noncontrolling interests
|
(5,849
|
)
|
(l)
|
(5,849
|
)
| ||||||||||||
Total stockholders' equity (deficit)/ members' equity
|
26,383
|
5,001
|
(41,590
|
)
|
(10,206
|
)
| |||||||||||
Total liabilities and stockholders' equity (deficit)/ members' equity
|
$
|
95,621
|
$
|
254,406
|
$
|
(15,467
|
)
|
$
|
334,560
|
WMH (Historical)
|
Silver Spike
(Historical)
|
Transaction Accounting Adjustments (Note 2)
|
Pro Forma Combined
| ||||||||||||||
Revenues
|
$
|
41,154
|
$
|
-
|
$
|
41,154
| |||||||||||
Operating expenses
| |||||||||||||||||
Cost of revenues
|
1,857
|
-
|
1,857
| ||||||||||||||
Sales and marketing
|
9,117
|
-
|
9,117
| ||||||||||||||
Product development
|
7,868
|
-
|
7,868
| ||||||||||||||
General and administrative
|
13,366
|
738
|
(60
|
)
|
(bb)
|
13,589
| |||||||||||
(455
|
)
|
(cc)
| |||||||||||||||
Depreciation and amortization
|
1,002
|
-
|
1,002
| ||||||||||||||
Total operating expenses
|
33,210
|
738
|
(515
|
)
|
33,433
| ||||||||||||
Income (Loss) from operations
|
7,944
|
(738
|
)
|
515
|
7,721
| ||||||||||||
Other income (expense):
| |||||||||||||||||
Interest earned on marketable securities held in Trust Account
|
-
|
30
|
(30
|
)
|
(aa)
|
-
| |||||||||||
Unrealized gain on marketable securities held in Trust Account
|
-
|
-
|
-
| ||||||||||||||
Change in fair value of warrant liability
|
(78,220
|
)
|
(78,220
|
)
| |||||||||||||
Interest expense
|
-
|
-
|
-
| ||||||||||||||
Other expense, net
|
28
|
-
|
28
| ||||||||||||||
Total other income (expense)
|
28
|
(78,190
|
)
|
(30
|
)
|
(78,192
|
)
| ||||||||||
Income (Loss) before provision for income taxes
|
7,972
|
(78,928
|
)
|
485
|
(70,471
|
)
| |||||||||||
Provision for income taxes
|
241
|
-
|
(8,422
|
)
|
(ff)
|
(8,181
|
)
| ||||||||||
Net income (loss)
|
7,731
|
(78,928
|
)
|
8,907
|
(62,290
|
)
| |||||||||||
Net income (loss) attributable to noncontrolling interests
|
-
|
-
|
(40,372
|
)
|
(gg)
|
(40,372
|
)
| ||||||||||
Net income (loss) attributable to common shareholders
|
$
|
7,731
|
$
|
(78,928
|
)
|
$
|
49,279
|
$
|
(21,918
|
)
| |||||||
Basic and diluted weighted average shares outstanding - Class A
|
63,738,563
| ||||||||||||||||
Basic and diluted net loss per share - Class A
|
$
|
(0.34
|
)
|
WMH (Historical)
|
Silver Spike
(Historical)
|
Transaction Accounting Adjustments (Note 2)
|
Pro Forma Combined
| ||||||||||||||
Revenues
|
$
|
161,791
|
$
|
-
|
$
|
161,791
| |||||||||||
Operating expenses
| |||||||||||||||||
Cost of revenues
|
7,630
|
-
|
7,630
| ||||||||||||||
Sales and marketing
|
30,716
|
-
|
30,716
| ||||||||||||||
Product development
|
27,142
|
-
|
27,142
| ||||||||||||||
General and administrative
|
51,127
|
3,864
|
(240
|
)
|
(bb)
|
65,380
| |||||||||||
(2,571
|
)
|
(cc)
| |||||||||||||||
13,200
|
(dd)
| ||||||||||||||||
Depreciation and amortization
|
3,978
|
-
|
3,978
| ||||||||||||||
Total operating expenses
|
120,593
|
3,864
|
10,389
|
134,846
| |||||||||||||
Income (Loss) from operations
|
41,198
|
(3,864
|
)
|
(10,389
|
)
|
26,945
| |||||||||||
Other income (expense):
| |||||||||||||||||
Interest earned on marketable securities held in Trust Account
|
-
|
2,258
|
(2,258
|
)
|
(aa)
|
-
| |||||||||||
Unrealized gain on marketable securities held in Trust Account
|
-
|
5
|
(5
|
)
|
(aa)
|
-
| |||||||||||
Change in fair value of warrant liability
|
(50,420
|
)
|
(50,420
|
)
| |||||||||||||
Interest expense
|
(2
|
)
|
-
|
(2
|
)
| ||||||||||||
Other expense, net
|
(2,366
|
)
|
-
|
(2,970
|
)
|
(ee)
|
(5,336
|
)
| |||||||||
Total other income (expense)
|
(2,368
|
)
|
(48,157
|
)
|
(5,233
|
)
|
(55,758
|
)
| |||||||||
Income (Loss) before provision for income taxes
|
38,830
|
(52,021
|
)
|
(15,622
|
)
|
(28,813
|
)
| ||||||||||
Provision for income taxes
|
-
|
-
|
(3,443
|
)
|
(ff)
|
(3,443
|
)
| ||||||||||
Net income (loss)
|
38,830
|
(52,021
|
)
|
(12,179
|
)
|
(25,370
|
)
| ||||||||||
Net income (loss) attributable to noncontrolling interests
|
-
|
-
|
(16,507
|
)
|
(gg)
|
(16,507
|
)
| ||||||||||
Net income (loss) attributable to common shareholders
|
$
|
38,830
|
$
|
(52,021
|
)
|
$
|
4,328
|
$
|
(8,863
|
)
| |||||||
Basic and diluted weighted average shares outstanding - Class A
|
63,738,563
| ||||||||||||||||
Basic and diluted net loss per share - Class A
|
$
|
(0.14
|
)
|
1. |
Basis of Presentation
|
• |
Silver Spike's unaudited balance sheet as of March 31, 2021 and the related notes, included in the Proxy Statement/Prospectus; and
|
• |
Legacy WMH's unaudited balance sheet as of March 31, 2021 and the related notes, included in the Proxy Statement/Prospectus.
|
• |
Silver Spike's unaudited statement of operations for the three months ended March 31, 2021 and the related notes, included in the Proxy Statement/Prospectus; and
|
• |
Legacy WMH's unaudited statement of operations for the three months ended March 31, 2021 and the related notes, included in the Proxy Statement/Prospectus.
|
• |
Silver Spike's audited statement of operations for the year ended December 31, 2020 and the related notes, included in the Proxy Statement/Prospectus; and
|
• |
Legacy WMH's audited consolidated statement of operations for the year ended December 31, 2020 and the related notes, included in the Proxy Statement/Prospectus.
|
2. |
Adjustments to Unaudited Pro Forma Condensed Combined Financial Information
|
a |
Reflects the reclassification of marketable securities held in the Trust Account that became available following the Business Combination.
|
b |
Reflects the settlement of $8.75 million in deferred underwriting fees.
|
c |
Represents estimated transaction costs incurred by Silver Spike and Legacy WMH of approximately $32.9 million for legal, financial advisory and other professional fees incurred in consummating the Business Combination. Of this amount, approximately:
|
• |
$2.6 million was capitalized within Prepaid expenses and other current assets and paid by Legacy WMH as of March 31, 2021.
|
• |
$0.6 was capitalized within Prepaid expenses and other current assets and accrued within Accounts payable and accrued expenses by Legacy WMH as of March 31, 2021.
|
• |
$3.0 million was accrued by Silver Spike in Accounts payable and accrued expenses as of March 31, 2021 and previously recognized in expense.
|
• |
$30.3 million was reflected as a reduction of cash, which represents the estimated transaction costs of $32.9 million less the $2.6 million previously paid by Legacy WMH.
|
• |
$3.0 million were not capitalized as part of the Business Combination and reflected as a decrease in accumulated deficit. The costs expensed through accumulated deficit are included in the unaudited pro forma condensed combined statement of operations for the year ended December 31, 2020 as discussed in Note (ee) below.
|
• |
$26.9 million were capitalized and offset against the proceeds from the Business Combination and PIPE subscription financing and reflected as a decrease in additional paid-in capital. This amount represents total estimated transaction costs less: 1) $3.0 million previously recognized in expense by Silver Spike and reclassified to additional paid-in capital in Note 2(h) of this unaudited pro forma condensed combined financial information; and 2) $3.0 million that were not capitalized as part of the Business Combination and reflected as a decrease in accumulated deficit.
|
d |
Reflects the proceeds of $325.0 million from the issuance and sale of 32,500,000 shares of Class A Common Stock at $10.00 per share in the PIPE subscription financing pursuant to the terms of the Subscription Agreements.
|
e |
Reflects the reclassification of $95.0 million of Class A ordinary shares subject to possible redemption to permanent equity.
|
f |
Represents share redemptions of 10,012 shares of Class A ordinary shares for $101,822 allocated to Class A ordinary shares and additional paid-in capital using par value of $0.0001 per share and at a redemption price of $10.17 per share.
|
g |
Reflects the conversion of Class A ordinary shares and Class B ordinary shares, on a one-for-one basis, into shares of Class A Common Stock upon the Domestication.
|
h |
Reflects the elimination of Silver Spike's historical accumulated deficit.
|
i |
Reflects the issuance of 65,502,349 shares of Class V Common Stock upon the Closing. The Class V Common Stock, par value $0.0001, entitle their holder to one vote per share but not any right to dividends or distributions.
|
j |
Reflects pursuant to the terms of the tax receivable agreement (1) the estimated deferred tax asset related to the tax basis step-up on the exchange of common units for cash in the Business Combination, and (2) the tax receivable agreement liability for amounts payable to post-merger WMH equity holders for tax benefits received by the Company on the step-up. The adjustment to deferred tax asset was calculated based on the estimated tax basis step-up multiplied by an estimated effective tax rate of 27.98%. The adjustment to long-term payable under Tax Receivable Agreement is 85% of the estimated tax benefit, in accordance with the terms of the tax receivable agreement. The remaining difference between the deferred tax asset and tax receivable agreement liability is reflected as additional paid-in capital.
|
k |
Represents approximately $13.2 million of share-based expense associated with vested Legacy WMH Class B units, which expense will be recorded upon the Closing. The cost expensed through accumulated deficit is included in the unaudited pro forma condensed combined statement of operations for the year ended December 31, 2020 as discussed in Note (dd) below.
|
l |
Represents the pro forma adjustment to: 1) reflect the payment of the cash consideration of $455.2 million to the Legacy WMH equity holders, and 2) to present the post-merger WMH units as noncontrolling interest upon the reorganization of the post-combination company into an Up-C structure. The noncontrolling interest adjustment reflects the allocation of the post-combination company's total equity (deficit) to the holders of post-merger WMH units approximate 57.3% economic interest in the post-combination company, as follows:
|
Total
Stockholders'
Equity
(100%)
|
Noncontrolling
Interest
(57.3%)
|
Common
Stockholders'
Equity
(42.7%)
| ||||||||||
Historical Legacy WMH members' equity
|
$
|
26,383
|
$
|
15,114
|
$
|
11,269
| ||||||
Historical Silver Spike total stockholders' equity
|
5,001
|
2,865
|
2,136
| |||||||||
Class A common stock issued in the PIPE subscription financing
|
325,000
|
186,186
|
138,814
| |||||||||
Reclass of redeemable public shares to permanent equity
|
95,006
|
54,427
|
40,579
| |||||||||
Redemption of public shares
|
(102
|
)
|
(58
|
)
|
(44
|
)
| ||||||
Payment of transaction costs
|
(29,878
|
)
|
(17,117
|
)
|
(12,761
|
)
| ||||||
Equity adjustment related to deferred tax asset and Tax Receivable Agreement liabilitiy
|
23,566
|
13,501
|
10,065
| |||||||||
Payment of aggregate cash consideration
|
(455,182
|
)
|
(260,767
|
)
|
(194,415
|
)
| ||||||
$
|
(10,206
|
)
|
$
|
(5,849
|
)
|
$
|
(4,357
|
)
|
aa |
Represents pro forma adjustment to eliminate interest income and unrealized gains on marketable securities held in the Trust Account.
|
bb |
Represents pro forma adjustment to eliminate historical expenses related to Silver Spike's office space, administrative and support services paid to the sponsor, which terminated upon consummation of the Business Combination.
|
cc |
Reflects pro forma adjustment to eliminate transaction costs expensed by Silver Spike during the three months ended March 31, 2021 and year ended December 31, 2020, which will be capitalized as part of the Business Combination or recognized in expense in Note (ee) below.
|
dd |
Represents approximately $13.2 million of share-based expense associated with vested Legacy WMH Class B units, which expense is recorded upon the Closing. These costs are reflected as incurred on January 1, 2020, the date the Business Combination occurred for purposes of the unaudited pro forma condensed combined statements of operations. This is a non-recurring item.
|
ee |
Reflects estimated transaction costs allocated to the public and private placement warrant liabilities that are assumed as part of the Business Combination. These costs are reflected as if incurred on January 1, 2020, the date the Business Combination occurred for the purposes of the unaudited pro forma condensed combined statements of operations. This is a non-recurring item.
|
ff |
Represents the pro forma adjustment for income taxes, applying an estimated statutory tax rate of 27.98%.
|
gg |
Represents the pro forma adjustment to allocate net loss to the noncontrolling interests. As the provision for income taxes was all attributable to common shareholders, the allocation of net loss to the noncontrolling interests was determined using Loss before provision for income taxes, as follows:
|
Three Months
Ended
March 31, 2021
|
Year Ended
December 31, 2020
| |||||||
Loss before provision for income taxes
|
$
|
(70,471
|
)
|
$
|
(28,813
|
)
| ||
Economic interest held by noncontrolling interest holders
|
57.3
|
%
|
57.3
|
%
| ||||
Net loss attributable to noncontrolling interests
|
$
|
(40,372
|
)
|
$
|
(16,507
|
)
|
3. |
Loss per Share
|
Three
Months
Ended
March 31,
2021
|
Year Ended
December 31, 2020
| |||||||
Pro forma net loss attributable to common shareholders (in thousands)
|
$
|
(21,918
|
)
|
$
|
(8,863
|
)
| ||
Pro forma weighted average shares outstanding, basic and diluted - Class A
|
63,738,563
|
63,738,563
| ||||||
Pro forma net loss per share, basic and diluted - Class A (1)(2)
|
$
|
(0.34
|
)
|
$
|
(0.14
|
)
| ||
Pro forma weighted average shares calculation, basis and diluted - Class A
| ||||||||
Silver Spike public shareholders - Class A
|
24,988,563
|
24,988,563
| ||||||
Holders of founder shares - Class A
|
6,250,000
|
6,250,000
| ||||||
Subscription investors - Class A
|
32,500,000
|
32,500,000
| ||||||
63,738,563
|
63,738,563
|
(1) |
Shares of Class V Common Stock will not share in the earnings or losses of the Company and are therefore not participating securities. As such, separate calculations of basic and diluted net loss per share for Class V Common Stock under the two-class method has not been presented.
|
(2) |
For the purpose of calculating diluted net loss per share, it was assumed that all outstanding public and private placement warrants are exchanged for shares of Class A Common Stock. However, since this results in anti-dilution, the effect of such exchange was not included in the calculation of diluted net loss per share.
|
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Silver Spike Acquisition Corp. published this content on 22 June 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 22 June 2021 10:06:06 UTC.