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OFFON

THUNDER BRIDGE CAPITAL PARTNERS III INC.

(TBCP)
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THUNDER BRIDGE CAPITAL PARTNERS III : Management's Discussion and Analysis of Financial Condition and Results of Operations (form 10-Q)

08/16/2021 | 05:00pm EST
References to the "Company," "us," "our" or "we" refer Thunder Bridge Capital
Partners III Inc. The following discussion and analysis of our financial
condition and results of operations should be read in conjunction with our
unaudited Condensed Consolidated financial statements and related notes included
herein.


Cautionary Note Regarding Forward-Looking Statements




All statements other than statements of historical fact included in this Form
10-Q including, without limitation, statements under "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. When used in
this Form 10-Q, words such as "anticipate," "believe," "estimate," "expect,"
"intend" and similar expressions, as they relate to us or the Company's
management, identify forward-looking statements. Such forward-looking statements
are based on the beliefs of management, as well as assumptions made by, and
information currently available to, the Company's management. Actual results
could differ materially from those contemplated by the forward- looking
statements as a result of certain factors detailed in our filings with the SEC.
All subsequent written or oral forward-looking statements attributable to us or
persons acting on the Company's behalf are qualified in their entirety by this
paragraph.



Overview


The Company is a blank check company incorporated as a Delaware corporation for
the purpose of effecting a merger, share exchange, asset acquisition, stock
purchase, reorganization or similar business combination with one or more
businesses. The Company intends to effectuate its initial Business Combination
using cash from the proceeds of the Initial Public Offering and the Private
Placement, the proceeds of the sale of our securities in connection with our
initial Business Combination, our shares, debt or a combination of cash, stock
and debt.


The issuance of additional common shares in a business combination:

? may significantly dilute the equity interest of investors, which dilution would

increase if the anti-dilution provisions in the shares of Class B common stock

resulted in the issuance of shares of Class A common stock on a greater than

one-to-one basis upon conversion of the shares of Class B common stock;

? may subordinate the rights of holders of shares of common stock if preference

shares are issued with rights senior to those afforded our shares of common

   stock;




? could cause a change of control if a substantial number of our shares 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 share ownership or voting rights of a person seeking to obtain

   control of us; and




? may adversely affect prevailing market prices for our shares of Class A common

   stock and/or warrants.



Similarly, if the Company issues debt securities, 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;




                                       19




? the Company's immediate payment of all principal and accrued interest, if any,

if the debt security is payable on demand;

? the Company's inability to obtain necessary additional financing if the debt

security contains covenants restricting our ability to obtain such financing

while the debt security is outstanding;

 ? the Company's inability to pay dividends on our shares of common stock;

? using a substantial portion of the Company's cash flow to pay principal and

interest on the Company's debt, which will reduce the funds available for

dividends on the Company's shares of common stock if declared, expenses,

capital expenditures, acquisitions and other general corporate purposes;

? limitations on the Company's flexibility in planning for and reacting to

changes in the Company's business and in the industry in which the Company

   operates;




? increased vulnerability to adverse changes in general economic, industry and

competitive conditions and adverse changes in government regulation; and

? limitations on the Company's ability to borrow additional amounts for expenses,

capital expenditures, acquisitions, debt service requirements, execution of the

Company's strategy and other purposes and other disadvantages compared to the

   Company's competitors who have less debt.




Results of Operations



We have neither engaged in any operations nor generated any revenues to date.
Our only activities from inception to June 30, 2021 were organizational
activities, those necessary to prepare for the Initial Public Offering ("Initial
Public Offering"), and identifying a target company for a business combination.
We do not expect to generate any operating revenues until after the completion
of our business combination. We expect to generate non-operating income in the
form of interest income on cash and marketable securities held after the Initial
Public Offering. We expect that we will incur increased expenses as a result of
being a public company (for legal, financial reporting, accounting and auditing
compliance), as well as for due diligence expenses in connection with completing
a business combination.


For the three months ended June 30, 2021, we had a net loss of $3,151,105, which
consists of formation costs and operating costs of $185,469, interest income of
$10,323 on monies held in our Trust Account (as defined below), and a loss
related to the change in the fair value of the warrant liability of $2,975,959.



For the six months ended June 30, 2021 and for the period from June 12, 2020
(date of inception) through June 30, 2020, we had a net loss of $3,732,979 and
$3,121, which consists of formation costs and operating costs of $308,760 and
$3,121, respectively, and interest income of $15,881 on monies held in our Trust
Account (as defined below), and a loss related to the change in the fair value
of the warrant liability of $3,440,100 for the six months ended June 30, 2021.



Liquidity and Capital Resources




On February 10, 2021, we consummated our Initial Public Offering in which we
sold 41,400,000 Units, which includes the full exercise by the underwriter of
the over-allotment option to purchase 5,400,000 Units at $10.00 per Unit
generating gross proceeds of $414,000,000 before underwriting fees and expenses.
Simultaneously with the closing of the Initial Public Offering, we consummated
the sale of 1,003,000 Private Placement Units at $10.00 per Private Placement
Unit to our Sponsor, generating gross proceeds of $10,030,000.



Transaction costs of the Initial Public Offering, amounted to $23,191,740
consisting of underwriting fees of $8,280,000 and deferred underwriting fees of
$14,490,000 and $421,740 of other costs. $463,835 of the total underwriting
costs were expensed in connection with the warrant liability and the balance was
charged to equity.



                                       20




As of June 30, 2021 we have available to us $537,444 of cash on our balance
sheet and a working capital deficit of $10,449,211. We will use these funds
primarily to and evaluate target businesses, perform business, legal, and
accounting 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 a business combination. The interest income earn on the investments in
the Trust Account are unavailable to fund operating expenses.



In order to finance transaction costs in connection with the Business
Combination, the Sponsor or an affiliate of the Sponsor or certain of the
Company's officers and directors may, but are not obligated to, loan the Company
funds as may be required ("Working Capital Loans"). If the Company completes the
Business Combination, the Company would repay such loaned amounts. In the event
that the Business Combination does not close, the Company may use a portion of
the working capital held outside the trust account to repay such loaned amounts
but no proceeds from the trust account would be used for such repayment. Up to
$1,500,000 of such loans may be convertible into Units at a price of $10.00 per
unit at the option of the lender. The units would be identical to the private
placement units issued to the Sponsor. The terms of such loans by the Company's
officers and directors, if any, have not been determined and no written
agreements exist with respect to such loans. The Company does not expect to seek
loans from parties other than the Sponsor or its directors or officers or their
respective affiliates as it does not believe third parties will be willing to
loan such funds and provide a waiver against any and all rights to seek access
to funds in the trust account.



Off-Balance Sheet Financing Arrangements

We have no obligations, assets or liabilities which would be considered off-balance sheet arrangements. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements.

We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or entered into any non-financial assets.



Contractual Obligations


At June 30, 2021, we did not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities.

The Underwriter was paid a cash underwriting fee of 2% of gross proceeds of the
Initial Public Offering, or $8,280,000. In addition, the Underwriter is entitled
to aggregate deferred underwriting commissions of $14,490,000 consisting of 3.5%
of the gross proceeds of the Initial Public Offering. The deferred underwriting
commissions will become payable to the Underwriter from the amounts held in the
Trust Account solely in the event that the Company completes an initial Business
Combination, subject to the terms of the underwriting agreement by and between
the Company and Morgan Stanley & Co. LLC.



Critical Accounting Policies




The preparation of financial statements and related disclosures in conformity
with GAAP requires the Company's 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. The Company has identified the following as its
critical accounting policies:



Net Loss Per Common Share


Basic loss per common share is computed by dividing net loss applicable to
common shareholders by the weighted average number of common shares outstanding
during the period. Consistent with FASB 480, common shares subject to possible
redemption, as well as their pro rata share of undistributed trust earnings
consistent with the two-class method, have been excluded from the calculation of
loss per common share for the three and six months ended June 30, 2021. Such
shares, if redeemed, only participate in their pro rata share of trust earnings.
Diluted loss per share includes the incremental number of common shares to be
issued to settle warrants, as calculated using the treasury method. For the
three and six months ended June 30, 2021, the Company did not have any dilutive
warrants, securities or other contracts that could potentially, be exercised or
converted into common shares. As a result, diluted loss per ordinary share is
the same as basic loss per common share for all periods presented.



                                       21





A reconciliation of net loss per common share as adjusted for the portion of
income that is attributable to common shares subject to redemption is as
follows:



                                                                                                           For the Period from
                                                                                                          June 12, 2020 (Date of
                           For the Three Months Ended June      For the Six Months Ended June 30,           Inception) through
                                      30, 2021                                2021                            June 30, 2020
                              Class A             Class B           Class A             Class B          Class A           Class B
Basic and diluted net
loss per share
Numerator:
Allocation of net loss,
as adjusted               $  (2,532,858 )     $    (618,247 )   $  (2,842,290 )     $    (890,689 )   $       -        $      (3,121 )
Denominator:
Basic and diluted
weighted average
common shares
outstanding                  42,403,000          10,350,000        33,032,171          10,350,000             -           10,350,000

Basic and diluted net loss per common share $ (0.06 ) $ (0.06 ) $ (0.09 ) $ (0.09 ) $ - $ -

Fair Value Measurements




Fair value is defined as the price that would be received for sale of an asset
or paid for transfer of a liability, in an orderly transaction between market
participants at the measurement date. GAAP establishes a three-tier fair value
hierarchy, which prioritizes the inputs used in measuring fair value. The
hierarchy gives the highest priority to unadjusted quoted prices in active
markets for identical assets or liabilities (Level 1 measurements) and the
lowest priority to unobservable inputs (Level 3 measurements). These tiers
include:



? Level 1, defined as observable inputs such as quoted prices (unadjusted) for

identical instruments in active markets;

? Level 2, defined as inputs other than quoted prices in active markets that are

either directly or indirectly observable such as quoted prices for similar

instruments in active markets or quoted prices for identical or similar

instruments in markets that are not active; and

? Level 3, defined as unobservable inputs in which little or no market data

exists, therefore requiring an entity to develop its own assumptions, such as

valuations derived from valuation techniques in which one or more significant

   inputs or significant value drivers are unobservable.




In some circumstances, the inputs used to measure fair value might be
categorized within different levels of the fair value hierarchy. In those
instances, the fair value measurement is categorized in its entirety in the fair
value hierarchy based on the lowest level input that is significant to the
fair
value measurement.


Derivative Financial Instruments




The Company evaluates its financial instruments to determine if such instruments
are derivatives or contain features that qualify as embedded derivatives in
accordance with ASC Topic 815, "Derivatives and Hedging". For derivative
financial instruments that are accounted for as liabilities, the derivative
instrument is initially recorded at its fair value on the grant date and is then
re-valued at each reporting date, with changes in the fair value reported in the
statements of operations. The classification of derivative instruments,
including whether such instruments should be recorded as liabilities or as
equity, is evaluated at the end of each reporting period. Derivative liabilities
are classified in the balance sheet as current or non-current based on whether
net-cash settlement or conversion of the instrument could be required within 12
months of the balance sheet date.



                                       22




Shares of common stock subject to possible redemption




The Company accounts for its shares of common stock subject to possible
redemption in accordance with the guidance in Accounting Standards Codification
("ASC") Topic 480 "Distinguishing Liabilities from Equity." Shares of common
stock subject to mandatory redemption (if any) is classified as a liability
instrument and is measured at fair value. Conditionally redeemable shares of
common stock (including shares of common stock that features redemption rights
that are either within the control of the holder or subject to redemption upon
the occurrence of events not solely within the Company's control) is classified
as temporary equity. At all other times, shares of common stock are classified
as stockholders' equity. The Company's shares of common stock feature certain
redemption rights that are considered to be outside of the Company's control and
subject to occurrence of uncertain future events. Accordingly, at June 30, 2021,
shares of common stock subject to possible redemption is presented as temporary
equity, outside of the shareholders' equity section of the Company's balance
sheet.


Recent Accounting Pronouncements

Management does not believe that any other recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company's financial statements.

© Edgar Online, source Glimpses

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Financials (USD)
Sales 2020 - - -
Net income 2020 -0,05 M - -
Net cash 2020 0,02 M - -
P/E ratio 2020 -
Yield 2020 -
Capitalization 519 M 519 M -
EV / Sales 2019
EV / Sales 2020 -
Nbr of Employees -
Free-Float 96,7%
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Managers and Directors
Gary A. Simanson President, Chief Executive Officer & Director
William A. Houlihan Chief Financial Officer
David E. Mangum Independent Director
Mary Anne Gillespie Independent Director
Robert H. Hartheimer Independent Director
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