x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Mark One)
| ☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||
2021
¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
| ☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||
Starboard Value Acquisition Corp.
| Delaware | 84-3743013 | |||||||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification | |||||||
| Title of each class | Trading | Name of each exchange on which registered | ||||||||||||
| CYXT | The Nasdaq Stock Market LLC | |||||||||||||
| Warrants to purchase one share of Class A | The Nasdaq Stock Market LLC | |||||||||||||
*The registrant became subject to such requirements on September 9, 2020, and it has filed all reports so required since that date.
☐
☐
| Large accelerated filer | Accelerated filer | ||||||||||
| Non-accelerated filer | Smaller reporting company | ||||||||||
| Emerging growth company | |||||||||||
☐
STARBOARD VALUE ACQUISITION CORP.
Quarterly Report on Form
Table of Contents
| Page | |||||||||
PART I - FINANCIAL INFORMATION
STARBOARD VALUE ACQUISITION CORP.
CONDENSED BALANCE SHEETS
| September 30, 2020 | December 31, 2019 | |||||||
| (Unaudited) | ||||||||
| Assets: | ||||||||
| Current assets: | ||||||||
| Cash | $ | 2,652,970 | $ | 72,751 | ||||
| Prepaid expenses | 279,418 | - | ||||||
| Total current assets | 2,932,388 | 72,751 | ||||||
| Deferred offering costs associated with the initial public offering | - | 312,489 | ||||||
| Investments held in Trust Account | 404,261,756 | - | ||||||
| Total Assets | $ | 407,194,144 | $ | 385,240 | ||||
| Liabilities and Stockholders' Equity: | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 42,363 | $ | 253,937 | ||||
| Accrued expenses | 70,000 | - | ||||||
| Franchise tax payable | 150,702 | 565 | ||||||
| Note payable - related party | - | 107,062 | ||||||
| Total current liabilities | 263,065 | 361,564 | ||||||
| Deferred legal fees | 250,000 | - | ||||||
| Deferred underwriting commissions in connection with the initial public offering | 18,190,554 | - | ||||||
| Total liabilities | 18,703,619 | 361,564 | ||||||
| Commitments and Contingencies | ||||||||
| Class A common stock; 38,349,052 shares subject to possible redemption at $10.00 per share | 383,490,520 | - | ||||||
| Stockholders' Equity: | ||||||||
| Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding | - | - | ||||||
| Class A common stock, $0.0001 par value; 200,000,000 shares authorized; 2,074,401 shares issued and outstanding (excluding 38,349,052 shares subject to possible redemption) | 207 | - | ||||||
| Class B common stock, $0.0001 par value; 20,000,000 shares authorized; 10,105,863 shares issued and outstanding (1) | 1,011 | 1,035 | ||||||
| Additional paid-in capital | 5,175,852 | 23,965 | ||||||
| Accumulated deficit | (177,065 | ) | (1,324 | ) | ||||
| Total stockholders' equity | 5,000,005 | 23,676 | ||||||
| Total Liabilities and Stockholders' Equity | $ | 407,194,144 | $ | 385,240 | ||||
(1) This number includes up to 1,350,000 shares of common stock subject to forfeiture if the over-allotment option was not exercised in full or in part by the underwriters as of December 31, 2019. On September 18, 2020, the underwriters partially exercised the over-allotment option to purchase an additional 4,423,453 Units; thus, only 244,137 Class B ordinary shares were forfeited accordingly.(see Note 5)
The accompanying notes are an integral part of these unaudited condensed financial statements.
STARBOARD VALUE ACQUISITION CORP.
UNAUDITED CONDENSED STATEMENTS OF OPERATIONS
| For The Three Months Ended September 30, 2020 | For The Nine Months Ended September 30, 2020 | |||||||
| General and administrative expenses | $ | 52,801 | $ | 52,830 | ||||
| Franchise tax expense | 147,937 | 150,137 | ||||||
| Loss from operations | $ | (200,738 | ) | $ | (202,967 | ) | ||
| Net gain on investments held in Trust Account | 27,226 | 27,226 | ||||||
| Net loss | $ | (173,512 | ) | $ | (175,741 | ) | ||
| Weighted average shares outstanding of Class A common stock | 38,081,625 | 38,081,625 | ||||||
| Basic and diluted net income per share | $ | - | $ | - | ||||
| Weighted average shares outstanding of Class B common stock | 10,105,863 | 10,105,863 | ||||||
| Basic and diluted net loss per share | $ | (0.02 | ) | $ | (0.02 | ) | ||
The accompanying notes are an integral part of these
| September 30, 2021 | December 31, 2020 | ||||||||||
| Assets: | |||||||||||
| Current assets: | |||||||||||
| Cash | $ | 74.5 | $ | 120.7 | |||||||
| Accounts receivable, net of allowance of $0.5 and $1.4, respectively | 26.2 | 33.5 | |||||||||
| Prepaid and other current assets | 38.0 | 41.9 | |||||||||
| Due from affiliates (Note 18) | — | 117.1 | |||||||||
| Total current assets | 138.7 | 313.2 | |||||||||
| Property and equipment, net | 1,496.4 | 1,580.7 | |||||||||
| Goodwill | 761.5 | 762.2 | |||||||||
| Intangible assets, net | 536.2 | 586.3 | |||||||||
| Other assets | 15.2 | 23.7 | |||||||||
| Total assets | $ | 2,948.0 | $ | 3,266.1 | |||||||
| Liabilities and shareholders' equity: | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | 48.1 | $ | 48.9 | |||||||
| Accrued expenses | 60.5 | 88.4 | |||||||||
| Due to affiliates (Note 18) | — | 22.7 | |||||||||
| Current portion of long-term debt, capital leases and other financing obligations | 49.9 | 65.0 | |||||||||
| Deferred revenue | 60.8 | 60.2 | |||||||||
| Other current liabilities | 9.1 | 6.8 | |||||||||
| Total current liabilities | 228.4 | 292.0 | |||||||||
| Long-term debt, net of current portion | 900.6 | 1,311.5 | |||||||||
| Capital leases and other financing obligations, net of current portion | 907.3 | 933.1 | |||||||||
| Deferred income taxes | 39.8 | 77.8 | |||||||||
| Warrant liabilities | 44.5 | — | |||||||||
| Other liabilities | 160.5 | 93.9 | |||||||||
| Total liabilities | 2,281.1 | 2,708.3 | |||||||||
| Commitments and contingencies (Note 16) | 0 | 0 | |||||||||
| Shareholders' equity: | |||||||||||
| Preferred Stock, $0.0001 par value; 10,000,000 shares authorized; none issued and outstanding | — | — | |||||||||
| Class A common stock, $0.0001 par value; 500,000,000 shares authorized; 165,978,740 and 115,745,455 shares issued and outstanding as of September 30, 2021 and December 31, 2020 , respectively | — | — | |||||||||
| Additional paid-in capital | 1,810.4 | 1,504.6 | |||||||||
| Accumulated other comprehensive income | 12.3 | 16.7 | |||||||||
| Accumulated deficit | (1,155.8) | (963.5) | |||||||||
| Total shareholders' equity | 666.9 | 557.8 | |||||||||
| Total liabilities and shareholders' equity | $ | 2,948.0 | $ | 3,266.1 | |||||||
| See accompanying notes to condensed consolidated financial statements | 4 | ||||
STARBOARD VALUE ACQUISITION CORP.
UNAUDITED
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
| Revenues | $ | 177.1 | $ | 172.0 | $ | 525.3 | $ | 517.7 | |||||||||||||||
| Operating costs and expenses | |||||||||||||||||||||||
| Cost of revenues, excluding depreciation and amortization | 93.5 | 97.3 | 287.4 | 287.3 | |||||||||||||||||||
| Selling, general and administrative expenses | 29.2 | 24.5 | 79.7 | 81.4 | |||||||||||||||||||
| Depreciation and amortization | 59.4 | 57.5 | 180.6 | 172.4 | |||||||||||||||||||
| Restructuring, impairment, site closures and related costs (Note 5) | 1.4 | — | 68.4 | — | |||||||||||||||||||
| Transaction-related costs (Note 13) | 5.2 | — | 5.2 | — | |||||||||||||||||||
| Impairment of notes receivable from affiliate (Note 18) | — | 9.4 | — | 18.2 | |||||||||||||||||||
| Total operating costs and expenses | 188.7 | 188.7 | 621.3 | 559.3 | |||||||||||||||||||
| Loss from operations | (11.6) | (16.7) | (96.0) | (41.6) | |||||||||||||||||||
| Interest expense, net | (43.1) | (42.4) | (129.3) | (127.8) | |||||||||||||||||||
| Other expenses, net | (0.4) | (1.4) | (1.2) | (2.1) | |||||||||||||||||||
| Change in fair value of warrant liabilities | (2.7) | — | (2.7) | — | |||||||||||||||||||
| Loss from operations before income taxes | (57.8) | (60.5) | (229.2) | (171.5) | |||||||||||||||||||
| Income tax benefit | 11.1 | 14.6 | 36.9 | 22.7 | |||||||||||||||||||
| Net loss | $ | (46.7) | $ | (45.9) | $ | (192.3) | $ | (148.8) | |||||||||||||||
| Loss Per Share | |||||||||||||||||||||||
| Basic and diluted | $ | (0.32) | $ | (0.40) | $ | (1.58) | $ | (1.29) | |||||||||||||||
| Weighted average number of shares outstanding | |||||||||||||||||||||||
| Basic and diluted | 147,754,776 | 115,745,455 | 121,868,742 | 115,745,455 | |||||||||||||||||||
| See accompanying notes to condensed consolidated financial statements | 5 | ||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
| Net loss | $ | (46.7) | $ | (45.9) | $ | (192.3) | $ | (148.8) | |||||||||||||||
| Other comprehensive income (loss): | |||||||||||||||||||||||
| Foreign currency translation adjustment | (6.1) | 9.7 | (4.4) | (5.1) | |||||||||||||||||||
| Other comprehensive income (loss) | (6.1) | 9.7 | (4.4) | (5.1) | |||||||||||||||||||
| Comprehensive loss | $ | (52.8) | $ | (36.2) | $ | (196.7) | $ | (153.9) | |||||||||||||||
| See accompanying notes to condensed consolidated financial statements | 6 | ||||
| Class A common stock | Additional paid-in capital | Accumulated other comprehensive income (loss) | Accumulated deficit | Total shareholders' equity | |||||||||||||||||||||||||||||||
| Share | Amount | ||||||||||||||||||||||||||||||||||
| Balance as of December 31, 2020 | 115,745,455 | $ | — | $ | 1,504.6 | $ | 16.7 | $ | (963.5) | $ | 557.8 | ||||||||||||||||||||||||
| Equity-based compensation | — | — | 1.9 | — | — | 1.9 | |||||||||||||||||||||||||||||
| Capital redemption | (9,645,455) | — | (97.9) | — | — | (97.9) | |||||||||||||||||||||||||||||
| Net loss | — | — | — | — | (52.6) | (52.6) | |||||||||||||||||||||||||||||
| Other comprehensive gain (loss) | — | — | — | 0.2 | — | 0.2 | |||||||||||||||||||||||||||||
| Balance as of March 31, 2021 | 106,100,000 | — | 1,408.6 | 16.9 | (1,016.1) | 409.4 | |||||||||||||||||||||||||||||
| Equity-based compensation | — | — | 1.7 | — | — | 1.7 | |||||||||||||||||||||||||||||
| Net loss | — | — | — | — | (93.0) | (93.0) | |||||||||||||||||||||||||||||
| Other comprehensive gain (loss) | — | — | — | 1.5 | — | 1.5 | |||||||||||||||||||||||||||||
| Balance as of June 30, 2021 | 106,100,000 | — | 1,410.3 | 18.4 | (1,109.1) | 319.6 | |||||||||||||||||||||||||||||
| Equity-based compensation | — | — | 1.8 | — | — | 1.8 | |||||||||||||||||||||||||||||
| Reverse recapitalization, net of transaction costs | 59,878,740 | — | 393.1 | — | — | 393.1 | |||||||||||||||||||||||||||||
| Capital contribution | — | — | 5.2 | — | — | 5.2 | |||||||||||||||||||||||||||||
| Net loss | — | — | — | — | (46.7) | (46.7) | |||||||||||||||||||||||||||||
| Other comprehensive (loss) gain | — | — | — | (6.1) | — | (6.1) | |||||||||||||||||||||||||||||
| Balance as of September 30, 2021 | 165,978,740 | $ | — | $ | 1,810.4 | $ | 12.3 | $ | (1,155.8) | $ | 666.9 | ||||||||||||||||||||||||
| See accompanying notes to condensed consolidated financial statements | 7 | ||||
| Class A common stock | Additional paid-in capital | Accumulated other comprehensive income (loss) | Accumulated deficit | Total shareholders' equity | |||||||||||||||||||||||||||||||
| Share | Amount | ||||||||||||||||||||||||||||||||||
| Balance as of December 31, 2019 | 0.96 | $ | — | $ | 1,494.9 | $ | 8.0 | $ | (840.7) | $ | 662.2 | ||||||||||||||||||||||||
| Retroactive application of recapitalization | 115,745,454 | — | — | — | — | — | |||||||||||||||||||||||||||||
| Adjusted balance, beginning of period | 115,745,455 | — | 1,494.9 | 8.0 | (840.7) | 662.2 | |||||||||||||||||||||||||||||
| Equity-based compensation | — | — | 2.2 | — | — | 2.2 | |||||||||||||||||||||||||||||
| Net loss | — | — | — | — | (47.4) | (47.4) | |||||||||||||||||||||||||||||
| Other comprehensive (loss) gain | — | — | — | (17.4) | — | (17.4) | |||||||||||||||||||||||||||||
| Balance as of March 30, 2020 | 115,745,455 | — | 1,497.1 | (9.4) | (888.1) | 599.6 | |||||||||||||||||||||||||||||
| Equity-based compensation | — | — | 2.0 | — | — | 2.0 | |||||||||||||||||||||||||||||
| Net loss | — | — | — | — | (55.5) | (55.5) | |||||||||||||||||||||||||||||
| Other comprehensive gain (loss) | — | — | — | 2.6 | — | 2.6 | |||||||||||||||||||||||||||||
| Balance as of June 30, 2020 | 115,745,455 | $ | — | 1,499.1 | (6.8) | (943.6) | 548.7 | ||||||||||||||||||||||||||||
| Equity-based compensation | — | — | 2.0 | — | — | 2.0 | |||||||||||||||||||||||||||||
| Net loss | — | — | — | — | (45.9) | (45.9) | |||||||||||||||||||||||||||||
| Other comprehensive gain (loss) | — | — | — | 9.7 | — | 9.7 | |||||||||||||||||||||||||||||
| Balance as of September 30, 2020 | 115,745,455 | $ | — | $ | 1,501.1 | $ | 2.9 | $ | (989.5) | $ | 514.5 | ||||||||||||||||||||||||
| See accompanying notes to condensed consolidated financial statements | 8 | ||||
| Nine Months Ended September 30, | |||||||||||
| 2021 | 2020 | ||||||||||
| Net loss | $ | (192.3) | $ | (148.8) | |||||||
| Cash flows from operating activities: | |||||||||||
| Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | 180.6 | 172.4 | |||||||||
| Restructuring, impairment, site closures and related costs | 2.0 | — | |||||||||
| Amortization of favorable/unfavorable leasehold interests, net | 2.9 | 2.4 | |||||||||
| Loss on extinguishment of debt and amortization of debt issuance costs and fees, net | 9.1 | 4.4 | |||||||||
| Impairment of notes receivable from affiliate (Note 18) | — | 18.2 | |||||||||
| Equity-based compensation | 5.4 | 5.7 | |||||||||
| Provision for (reversal of) doubtful accounts | (1.1) | (4.0) | |||||||||
| Deferred income taxes | (37.1) | (23.9) | |||||||||
| Change of fair value of warrant liabilities | 2.7 | — | |||||||||
| Non-cash interest expense, net | 7.1 | 9.8 | |||||||||
| Changes in operating assets and liabilities, excluding impact of acquisitions and dispositions: | |||||||||||
| Accounts receivable | 8.3 | 21.1 | |||||||||
| Prepaid and other current assets | 3.1 | 12.8 | |||||||||
| Other assets | 8.1 | 3.7 | |||||||||
| Accounts payable | (10.5) | 3.0 | |||||||||
| Accrued expenses | (27.7) | (6.2) | |||||||||
| Due to affiliates | (22.8) | — | |||||||||
| Other liabilities | 63.0 | 14.8 | |||||||||
| Net cash provided by operating activities | 0.8 | 85.4 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Purchases from property and equipment | (44.1) | (58.5) | |||||||||
| Amounts received from (advanced to) affiliate (Note 18) | 117.1 | (14.9) | |||||||||
| Net cash provided by (used in) investing activities | 73.0 | (73.4) | |||||||||
| Cash flows from financing activities: | |||||||||||
| Proceeds from issuance of long-term debt and other financing obligations | 40.0 | 91.7 | |||||||||
| Proceeds from recapitalization, net of issuance costs | 436.0 | — | |||||||||
| Repayment of long-term debt | (459.4) | (8.0) | |||||||||
| Repayment of capital leases and other financing obligations | (49.1) | (26.3) | |||||||||
| Capital redemption | (97.9) | — | |||||||||
| Capital contribution | 5.2 | — | |||||||||
| Net cash (used in) provided by financing activities | (125.2) | 57.4 | |||||||||
| Effect of foreign currency exchange rates on cash | 5.2 | (2.9) | |||||||||
| Net (decrease) increase in cash | (46.2) | 66.5 | |||||||||
| Cash at beginning of period | 120.7 | 12.9 | |||||||||
| Cash at end of period | $ | 74.5 | $ | 79.4 | |||||||
| Supplemental cash flow information: | |||||||||||
| Cash paid for income taxes, net | $ | 4.3 | $ | 1.6 | |||||||
| Cash paid for interest | $ | 67.6 | $ | 43.4 | |||||||
| Non-cash purchases of property and equipment | $ | 19.4 | $ | 42.4 | |||||||
| See accompanying notes to condensed consolidated financial statements | 9 | ||||
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2020
| For the Three and Nine Months Ended September 30, 2020 | ||||||||||||||||||||||||||||
| Common Stock | Additional | Total | ||||||||||||||||||||||||||
| Class A | Class B | Paid-In | Accumulated | Stockholders' | ||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Capital | Deficit | Equity | ||||||||||||||||||||||
| Balance - December 31, 2019 (1)(2) | - | $ | - | 10,350,000 | $ | 1,035 | $ | 23,965 | $ | (1,324 | ) | $ | 23,676 | |||||||||||||||
| Net loss (unaudited) | - | - | - | - | - | (1,086 | ) | (1,086 | ) | |||||||||||||||||||
| Balance - March 31, 2020 (unaudited) (1)(2) | - | $ | - | 10,350,000 | $ | 1,035 | $ | 23,965 | $ | (2,410 | ) | $ | 22,590 | |||||||||||||||
| Net loss (unaudited) | - | - | - | - | - | (1,143 | ) | (1,143 | ) | |||||||||||||||||||
| Balance - June 30, 2020 (unaudited) (1)(2) | - | $ | - | 10,350,000 | $ | 1,035 | $ | 23,965 | $ | (3,553 | ) | $ | 21,447 | |||||||||||||||
| Sale of units in initial public offering, gross | 40,423,453 | 4,042 | - | - | 404,230,488 | - | 404,234,530 | |||||||||||||||||||||
| Offering costs | - | - | - | - | (25,676,631 | ) | - | (25,676,631 | ) | |||||||||||||||||||
| Sale of private placement warrants to Sponsor in private placement | - | - | - | - | 10,084,691 | - | 10,084,691 | |||||||||||||||||||||
| Class B common stock forfeited | - | - | (244,137 | ) | (24 | ) | 24 | - | - | |||||||||||||||||||
| Class A common stock subject to possible redemption | (38,349,052 | ) | (3,835 | ) | - | - | (383,486,685 | ) | - | (383,490,520 | ) | |||||||||||||||||
| Net loss | - | - | - | - | - | (173,512 | ) | (173,512 | ) | |||||||||||||||||||
| Balance - September 30, 2020 (unaudited) | 2,074,401 | $ | 207 | 10,105,863 | $ | 1,011 | $ | 5,175,852 | $ | (177,065 | ) | $ | 5,000,005 | |||||||||||||||
The accompanying notes are an integral part of these unaudited condensed financial statements.
(1) This number includes up to 1,350,000 shares of common stock subject to forfeiture if the over-allotment option was not exercised in full or in part by the underwriters. On September 18, 2020, the underwriters partially exercised the over-allotment option to purchase an additional 4,423,453 Units; thus, only 244,137 Class B ordinary shares were forfeited accordingly.(see
(2) As of December 31, 2019, March 31, 20201. Organization and June 30, 2020, 8,625,000 sharesdescription of the Company’s Class B common stock, par value $0.0001 per share,business
STARBOARD VALUE ACQUISITION CORP.
UNAUDITED CONDENSED STATEMENT OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020
| Cash Flows from Operating Activities: | ||||
| Net loss | $ | (175,741 | ) | |
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||
| Net gain from investments held in Trust Account | (27,226 | ) | ||
| Changes in operating assets and liabilities: | ||||
| Prepaid expenses | (279,418 | ) | ||
| Accounts payable | 30,760 | |||
| Franchise tax payable | 150,137 | |||
| Net cash used in operating activities | (301,488 | ) | ||
| Cash Flows from Investing Activities | ||||
| Cash deposited in Trust Account | (404,234,530 | ) | ||
| Net cash used in investing activities | (404,234,530 | ) | ||
| Cash Flows from Financing Activities: | ||||
| Proceeds from note payable to related parties | 41,500 | |||
| Repayment of note payable to related party | (141,500 | ) | ||
| Proceeds received from initial public offering, gross | 404,234,530 | |||
| Proceeds received from private placement | 10,084,691 | |||
| Offering costs paid | (7,102,984 | ) | ||
| Net cash provided by financing activities | 407,116,237 | |||
| Net change in cash | 2,580,219 | |||
| Cash - beginning of the period | 72,751 | |||
| Cash - end of the period | $ | 2,652,970 | ||
| Supplemental disclosure of noncash financing activities: | ||||
| Offering costs included in accounts payable | $ | 7,666 | ||
| Offering costs included in accrued expenses | $ | 70,000 | ||
| Offering costs funded with note payable | $ | 7,062 | ||
| Deferred underwriting commissions in connection with the initial public offering | $ | 18,190,554 | ||
| Deferred legal fees | $ | 250,000 | ||
| Initial value of Class A common stock subject to possible redemption | $ | 341,051,610 | ||
| Change in initial value of Class A common stock subject to possible redemption | $ | 42,438,910 | ||
| Forfeiture of Class B common stock | $ | 24 | ||
The accompanying notes are an integral part of these unaudited condensed financial statements.
STARBOARD VALUE ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Note 1—Description of Organization, Business Operations and Basis of Presentation
Delaware as Starboard Value Acquisition Corp. (the “Company”(“SVAC”) was incorporated in Delaware on November 14, 2019. The Company was formed forOn July 29, 2021 (the “Closing Date”), SVAC consummated the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similarpreviously announced business combination with one or more businesses (the “Business Combination”). The Company is an emerging growth company and, as such, the Company is subject to all of the risks associated with emerging growth companies.
As of September 30, 2020, the Company had not commenced any operations. All activity for the period from November 14, 2019 (inception) through September 30, 2020 relatespursuant to the Company’s formationAgreement and the initial public offeringPlan of Merger, dated February 21, 2021 (the “Initial Public Offering”“Merger Agreement”) described below. The Company will not generate any operating revenues until after the completion, by and among SVAC, Cyxtera Technologies, Inc., a Delaware corporation (“Legacy Cyxtera”), Mundo Merger Sub 1, Inc., a Delaware Corporation and wholly-owned subsidiary of its initial Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income on cash and cash equivalents from the proceeds derived from the Initial Public Offering.
The Company’s sponsor is SVAC Sponsor("Merger Sub 1"), Mundo Merger Sub 2, LLC, a Delaware limited liability company (the “Sponsor”and wholly-owned subsidiary of SVAC ("Merger Sub 2" and, together with Mundo Merger Sub 1, the "Merger Subs"), and Mundo Holdings, Inc. ("NewCo"), a Delaware corporation and wholly-owned subsidiary of SIS Holding LP, a Delaware limited partnership ("SIS"). The registration statements for the Company’s Initial Public Offering became effective on September 9, 2020. On September 14, 2020, the Company consummated its Initial Public Offering of 36,000,000 units (the “Units” and, with respectPursuant to the Class A common stock, par value $0.0001 per share, includedMerger Agreement, Legacy Cyxtera was contributed to Newco and then converted into a limited liability company and, thereafter, Merger Sub 1 was merged with and into NewCo, with NewCo surviving such merger as a wholly-owned subsidiary of SVAC and immediately following such merger and as part of the same overall transaction NewCo was merged with and into Merger Sub 2, with Merger Sub 2 surviving such merger as a wholly owned subsidiary of SVAC (the “Business Combination” and, collectively with the other transactions described in the Units offered,Merger Agreement, the “Public Shares”“Transactions”) at $10.00 per Unit, generating gross proceeds of $360.0 million,. On the Closing Date, and incurring offering costs of approximately $23.0 million, inclusive of $16.2 million in deferred underwriting commissions (Note 5). The underwriters were granted a 45-day option from the date of the final prospectus relating to the Initial Public Offering to purchase up to 5,400,000 additional Units to cover over-allotments, if any, at $10.00 per Unit, less underwriting discounts and commissions. On September 18, 2020, the underwriters partially exercised the over-allotment option and on September 23, 2020, purchased an additional 4,423,453 Units (the “Over-Allotment Units”), generating gross proceeds of approximately $44.2 million, and incurred additional offering costs of approximately $2.7 million (net of approximately $221,000 in reimbursement for certain expenses from the underwriters), including approximately $2.0 million in deferred underwriting fees.
Simultaneouslyconnection with the closing of the Initial Public Offering,Business Combination, SVAC changed its name to Cyxtera Technologies, Inc.
Upon the closing of the Initial Public Offering, the Private Placement, the sale of the Over-Allotment Units and 589,794 additional Private Placement Warrants, $404.2 million ($10.00 per Unit) of the net proceeds of the sale of the Units in the Initial Public Offering, the Private Placement, the Over-Allotment Units and the additional Private Placement Warrants were placed in a trust account (“Trust Account”) located in the United States with Continental Stock Transfer & Trust Company acting as trustee, and invested only in U.S. “government securities,” within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 185 days or less, or in money market funds meeting the conditions of paragraphs (d)(2), (d)(3) and (d)(4) of Rule 2a-7 under the Investment Company Act, which invest only in direct U.S. government treasury obligations, as determined by the Company, until the earlier of: (i) the completion of a Business Combination and (ii)references to “Legacy Cyxtera” refer to Cyxtera Technologies, Inc. prior to the distributionconsummation of the Trust Account as described below.
The Company’s management has broad discretion with respect toBusiness Combination.
STARBOARD VALUE ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
The Company will provide holders of the Public Shares (the “Public Stockholders”) with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a stockholder meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek stockholder approval of a Business Combination or conduct a tender offer will be made by the Company, solely in its discretion. The Public Stockholders will be entitled to redeem their Public Shares for a pro rata portionbased on an analysis of the amount then heldcriteria outlined in the Trust Account (initially anticipated to be $10.00 per Public Share). The per-share amount to be distributed to Public Stockholders who redeem their Public Shares will not be reduced by the deferred underwriting commissions the Company will pay to the underwriters (as discussed in Note 5). The redemption rights will include the requirement that a beneficial holder must identify itself in order to validly redeem its shares. These Public Shares will be recorded at a redemption value and classified as temporary equity upon the completion of the Initial Public Offering in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” In such case,805. This determination was primarily based on Legacy Cyxtera’s stockholders prior to the Company will proceed with a Business Combination if the Company has net tangible assets of at least $5,000,001 upon consummation of such Business Combination andhaving a majority of the shares votedvoting power in the combined company, Legacy Cyxtera having the ability to appoint a majority of the Board of Directors of the combined company, Legacy Cyxtera’s existing management comprising the senior management of the combined company, Legacy Cyxtera's operations comprising the ongoing operations of the combined company, Legacy Cyxtera being the larger entity based on historical revenues and business operations and the combined company assuming Legacy Cyxtera’s name. Accordingly, for accounting purposes, the Business Combination was treated as the equivalent of Legacy Cyxtera issuing stock for the net assets of SVAC, accompanied by a recapitalization. The net assets of SVAC are votedstated at historical cost, with no goodwill or other intangible assets recorded.
Notwithstanding the foregoing, the Certificate of Incorporation provides that a Public Stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 Refer to Note 3 for further discussion of the Securities Exchange ActCyxtera and SVAC Business Combination.
The Sponsorfinancial position and the Company’s officers and directors have agreed not to propose an amendment to the Certificateresults of Incorporation that would affect the substance or timing of the Company’s obligation to redeem 100% of the Public Shares if the Company does not complete a Business Combination within the time frame described below, unless the Company provides the Public Stockholders with the opportunity to redeem their Public Shares in conjunction with any such amendment.
If the Company is unable to complete a Business Combination within 24 months from the closing of the Initial Public Offering, or September 14, 2022 (the “Combination Period”), the Company 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 the Company to pay its franchise and income 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 the Public Stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining stockholders and its board of directors, dissolve and liquidate, subject in each case to the Company’s obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.
STARBOARD VALUE ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
interim periods presented. The Sponsor and the Company’s officers and directors have agreed to waive their liquidation rights with respect to the Founder Shares if the Company fails to complete a Business Combination within the Combination Period. However, if the Sponsor and the Company’s officers and directors should acquire Public Shares in or after the Initial Public Offering, they will be entitled to liquidating distributions from the Trust Account with respect to such Public Shares if the Company fails to complete a Business Combination within the Combination Period. The underwriters have agreed to waive their rights to the deferred underwriting commission (see Note 5) held in the Trust Account in the event the Company does not complete a Business Combination within in the Combination Period and, in such event, such amounts will be included with the other funds held in the Trust Account that will be available to fund the redemption of the Public Shares. In the event of such distribution, it is possible that the per share value of the residual assets remaining available for distribution (including Trust Account assets) will be only $10.00. In order to protect the amounts held in the Trust Account, the Sponsor has agreed to be liable to the Company if and to the extent any claims by a third party (except for the Company’s independent registered public accounting firm) for services rendered or products sold to the Company, or a prospective target business with which the Company has entered into a transaction agreement reduce the amount of funds in the Trust Account to below the lesser of (i) $10.00 per Public Share and (ii) the actual amount per Public Share held in the Trust Account due to reductions in the value of the trust assetscondensed consolidated balance sheet data as of the date of the liquidation of the Trust Account, in each case including interest earned on the funds held in the Trust Account and not previously released to the Company to pay its franchise and income taxes, less franchise and income taxes payable. This liability will not apply with respect to any claims by a third party or target that executed an agreement waiving claims against and all rights to seek access to the Trust Account whether or not such agreement is enforceable or to any claims under the Company’s indemnity of the underwriters of the Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers (except for the Company's independent registered public accounting firm), prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account.
Basis of Presentation
The accompanying unaudited condensedDecember 31, 2020 has been derived from audited consolidated financial statements as of the Companythat date. The condensed consolidated financial statements have been prepared in accordance with United Statesthe regulations of the Securities and Exchange Commission ("SEC") but omit certain information and footnote disclosure necessary to present the statements in accordance with generally accepted accounting principles (“in the United States of America ("U.S. GAAP”GAAP"). For further information, refer to the Company's consolidated financial statements as of and for the year ended December 31, 2020 included in the Final Prospectus Supplement, pursuant to Rule 424(b)(3), dated September 7, 2021, to the Registration Statement on Form S-1 (Registration No. 333-258948) filed by the Company on August 20, 2021 (the "Registration Statement on Form S-1"). Results for the interim financial information and Article 8 of Regulation S-X. Accordingly, they doperiods are not include allnecessarily indicative of the information and footnotes required by U.S. GAAP. In the opinion of management, all adjustments (consisting of normal accruals) considered for a fair presentation have been included. Operating results for the entire fiscal year.
The accompanying unaudited condensed financial statements should be readBusiness Combination were recognized as derivative liabilities in conjunctionaccordance with the audited balance sheet and notes thereto included in the Current Report on Form 8-K, the unaudited pro forma balance sheet and notes thereto included in the Current Report on Form 8-K and the final prospectus filed byASC Topic 815. Accordingly, the Company recognizes the warrant instruments as liabilities at fair value and adjusts the carrying value of the instruments to fair value at each reporting period until they are exercised. The Public and Private Placement Warrants were initially recorded at fair value on the date of the Business Combination.
Emerging Growth Company
future expectations.
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards.. The JOBS Act provides that an emerging growth company can electtake advantage of an extended transition period for complying with new or revised accounting standards, such that an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to opt outprivate companies. The Company has elected to avail itself of the extended transition periodperiods and, comply withas a result, the requirementsCompany will not be required to adopt new or revised accounting standards on the adoption dates required for other public companies so long as the Company remains an emerging growth company.
STARBOARD VALUE ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
This may make comparison of the Company’s financial statements with another public company that is neitherdate it no longer qualifies as an emerging growth company, norwhichever is earlier. Entities are permitted to use a modified retrospective approach. The Company is evaluating the impact that the adoption of this standard will have on its consolidated financial statements.
Liquidityassets and Capital Resources
Asliabilities on the condensed consolidated balance sheet at adoption due to the recording of September 30, 2020,right-of-use assets and corresponding lease liabilities related to its operating leases pursuant to which the Company had approximately $2.7 millionis a lessee. The Company does not expect the adoption of this guidance to have any impact on its cash flows and liquidity.
The Company’s liquidity needstwo business days prior to date have been satisfied through the payment of $25,000 from the Sponsor to purchase the Founder Shares, the loan under the Note (as defined below) of approximately $141,000 (see Note 4) from the Sponsor, and the net proceeds from the consummation of the Private Placement not heldBusiness Combination, which was approximately $10.00 per share or $261.8 million in the Trust Account. The Company fully repaid the Note on September 14, 2020. In addition, in order to finance transaction costs in connection withaggregate. As a Business Combination, the Sponsor or an affiliate of the Sponsor, or the Company’s officers and directors may, but are not obligated to, provide the Company Working Capital Loans (as defined below in Note 4). As of September 30, 2020, there were no Working Capital Loans outstanding.
Based on the foregoing, management believes that the Company will have sufficient working capital and borrowing capacity from the Sponsor or an affiliate of the Sponsor, or the Company’s officers and directors 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 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.
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 financial statements do not include any adjustments that might result, from the outcome of this uncertainty.
Note 2—Summary of Significant Accounting Policies
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.
Cash and Cash Equivalents
The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company had no cash equivalents at September 30, 2020.
Investments Held in Trust Account
The Company’s portfolio of investments is comprised solely of U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act, with a maturity of 185 days or less, or investments in money market funds that invest in U.S. government securities, or a combination thereof. The Company’s investments held in the Trust Account are classified as trading securities. Trading securities are presented on the unaudited condensed balance sheet at fair value at the end of each reporting period. Gains and losses resulting from the change in fair value of these securities is included in net gain on investments held in Trust Account in the accompanying unaudited condensed statements of operations. The estimated fair values of investments held in the Trust Account are determined using available market information.
STARBOARD VALUE ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash accounts in a financial institution, which, at times, may exceed the Federal Depository Insurance Coverage of $250,000, and investments held in Trust Account. At September 30, 2020, the Company has not experienced losses on these accounts and management believes the Company is not exposed to significant risks on such accounts.
Fair Value of Financial Instruments
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. U.S. 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:
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.
As of September 30, 2020, the carrying values of cash, accounts payable, accrued expenses, and franchise tax payable approximate their fair values due to the short-term nature of the instruments. The Company’s portfolio of investments held in the Trust Account is comprised of investments in U.S. Treasury securities with an original maturity of 185 days or less or investments in money market funds that invest in U.S. government securities, or a combination thereof. The fair value for trading securities is determined using quoted market prices in active markets.
Offering Costs Associated with the Initial Public Offering
Offering costs consisted of underwriting, legal, accounting, and other costs incurred that were directly related to the Initial Public Offering and that were charged to stockholders’ equity upon the completion of the Initial Public Offering.
Class A Common Stock Subject to Possible Redemption
The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in ASC Topic 480 “Distinguishing Liabilities from Equity.��� Class A common stock subject to mandatory redemption (if any) is classified as liability instruments and measured at fair value. Conditionally redeemable Class A common stock (including Class A common stock that features redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, Class A common stock is classified as stockholders’ equity. The Company’s Class A common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to the occurrence of uncertain future events. Accordingly, at September 30, 2020, 38,349,05214,246,562 shares of Class A common stock subject to possible redemption are presented as temporary equity, outsideremained outstanding leaving $142.5 million in the trust account.
| Recapitalization (in millions) | ||||||||
| SVAC's trust and cash, net of redemptions | $ | 143.9 | ||||||
| Cash- PIPE Investment | 250.0 | |||||||
| Cash- Forward Purchase | 100.0 | |||||||
| Less: transaction costs and advisory fees, net of tax benefit | (57.9) | |||||||
| Net proceeds from reverse recapitalization | 436.0 | |||||||
| Plus: non-cash net liabilities assumed (1) | (41.8) | |||||||
| Less: accrued transaction costs and advisory fees | (1.1) | |||||||
| Net contributions from reverse recapitalization | $ | 393.1 | ||||||
STARBOARD VALUE ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Income Taxes
The Company follows the asset
For tax benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. There were no unrecognized tax benefits as of September 30, 2020. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. No amounts were accrued for the payment of interest and penalties as of September 30, 2020. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company has been subject to income tax examinations by major taxing authorities since inception.
Net Income (Loss) Per Common Share
Netassumed.
| Nine Months Ended September 30, 2021 | |||||||||||
| Beginning balance | $ | — | |||||||||
| Lease termination costs | 64.4 | ||||||||||
| Reclassification of deferred rent credits | 3.4 | ||||||||||
| Accretion | 2.0 | ||||||||||
| Payments | (6.1) | ||||||||||
| Ending balance | $ | 63.7 | |||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
| Recurring revenue | $ | 169.3 | $ | 163.5 | $ | 501.2 | $ | 493.5 | |||||||||||||||
| Non-recurring revenues | 7.8 | 8.5 | 24.1 | 24.2 | |||||||||||||||||||
| Total | $ | 177.1 | $ | 172.0 | $ | 525.3 | $ | 517.7 | |||||||||||||||
| Receivables | Contract asset, current | Contract asset, non-current | Deferred revenue, current | Deferred revenue, non-current | |||||||||||||||||||||||||
| Closing balances as of December 31, 2019 | $ | 65.2 | $ | 32.5 | $ | 23.8 | $ | 14.6 | $ | 9.6 | |||||||||||||||||||
| Net increase (decrease) during the three months ended March 31, 2020 | 16.7 | (1.7) | (3.3) | (0.8) | — | ||||||||||||||||||||||||
| Closing balances as of as of March 31, 2020 | 81.9 | 30.8 | 20.5 | 13.8 | 9.6 | ||||||||||||||||||||||||
| Net (decrease) increase during the three months ended June 30, 2020 | (29.1) | (2.1) | (2.8) | (1.1) | 0.2 | ||||||||||||||||||||||||
| Closing balances as of as of June 30, 2020 | 52.8 | 28.7 | 17.7 | 12.7 | 9.8 | ||||||||||||||||||||||||
| Net (decrease) increase during the three months ended September 30, 2020 | (4.6) | (2.8) | (1.1) | 2.1 | 8.5 | ||||||||||||||||||||||||
| Closing balances as of September 30, 2020 | $ | 48.2 | $ | 25.9 | $ | 16.6 | $ | 14.8 | $ | 18.3 | |||||||||||||||||||
| Closing balances as of December 31, 2020 | 33.5 | 23.8 | 16.8 | 15.6 | 18.1 | ||||||||||||||||||||||||
| Net (decrease) increase during the three months ended March 31, 2021 | (20.9) | (1.8) | (2.7) | (0.5) | (2.0) | ||||||||||||||||||||||||
| Closing balances as of as of March 31, 2021 | 12.6 | 22.0 | 14.1 | 15.1 | 16.1 | ||||||||||||||||||||||||
| Net increase (decrease) during the three months ended June 30, 2021 | 3.7 | (2.4) | (1.5) | (0.4) | (0.8) | ||||||||||||||||||||||||
| Closing balances as of as of June 30, 2021 | 16.3 | 19.6 | 12.6 | 14.7 | 15.3 | ||||||||||||||||||||||||
| Net increase (decrease) during the three months ended September 30, 2021 | 9.9 | (1.3) | (1.7) | 0.4 | 1.4 | ||||||||||||||||||||||||
| Closing balances as of September 30, 2021 | $ | 26.2 | $ | 18.3 | $ | 10.9 | $ | 15.1 | $ | 16.7 | |||||||||||||||||||
| September 30, 2021 | December 31, 2020 | ||||||||||
| Beginning balance | $ | 1.4 | $ | 13.5 | |||||||
| Recoveries (Write-offs) | 0.2 | (6.5) | |||||||||
| Reversal of allowance | (1.1) | (5.5) | |||||||||
| Impact of foreign currency translation | — | (0.1) | |||||||||
| Ending balance | $ | 0.5 | $ | 1.4 | |||||||
| September 30, 2021 | December 31, 2020 | ||||||||||
| Contract asset, current | $ | 18.3 | $ | 23.8 | |||||||
| Prepaid expenses | 19.1 | 14.6 | |||||||||
| Value added tax ("VAT") receivable | — | 0.9 | |||||||||
| Other current assets | 0.6 | 2.6 | |||||||||
| Total prepaid and other current assets | $ | 38.0 | $ | 41.9 | |||||||
| September 30, 2021 | December 31, 2020 | ||||||||||||||||||||||||||||||||||
| Gross | Accumulated Amortization | Net | Gross | Accumulated Amortization | Net | ||||||||||||||||||||||||||||||
| Customer relationships | $ | 768.0 | $ | (266.4) | $ | 501.6 | $ | 768.0 | $ | (221.1) | $ | 546.9 | |||||||||||||||||||||||
| Favorable leasehold interests | 57.6 | (23.5) | 34.1 | 59.3 | (20.4) | 38.9 | |||||||||||||||||||||||||||||
| Developed technology | 0.3 | (0.3) | — | 0.3 | (0.3) | — | |||||||||||||||||||||||||||||
| Total intangibles | $ | 825.9 | $ | (290.2) | $ | 535.7 | $ | 827.6 | $ | (241.8) | $ | 585.8 | |||||||||||||||||||||||
The Company’s unaudited condensed statements of operations include a presentation of net income (loss) per share for common stock subject to redemption in a manner similar to the two-class method of income per share. Net income per common share, basic$11.8 million, $45.2 million, $12.4 million and diluted for Class A common stock is calculated by dividing the net gain on investments held in the Trust Account, net of applicable taxes available to be withdrawn from the Trust Account of approximately $27,000$45.3 million, respectively, for the three and nine months ended September 30, 2021 and 2020. Amortization expense for all intangible assets, except favorable leasehold interests, was recorded within depreciation and amortization expense in the condensed consolidated statements of operations. As of September 30, 2021 and December 31, 2020, resultingthe Company had $16.8 million and $18.5 million, respectively, of unfavorable leasehold interests included within other liabilities in net incomethe accompanying condensed consolidated balance sheets. Favorable leasehold amortization of nil$1.3 million, $4.6 million, $1.4 million and $4.1 million, and unfavorable leasehold amortization of $0.6 million, $1.7 million, $0.6 million and $1.7 million, respectively, was recorded within cost of revenues, excluding depreciation and amortization in the condensed consolidated statements of operations for the three and nine months ended September 30, 2021 and 2020, byrespectively.
| For the years ending December 31: | |||||
| Remaining 2021 | $ | 16.8 | |||
| 2022 | 65.7 | ||||
| 2023 | 65.7 | ||||
| 2024 | 65.7 | ||||
| 2025 | 65.0 | ||||
| Thereafter | 256.8 | ||||
| Total amortization expense | $ | 535.7 | |||
| September 30, 2021 | December 31, 2020 | ||||||||||||||||||||||
| Carrying value | Fair value | Carrying value | Fair value | ||||||||||||||||||||
| 2017 First Lien Term Facility | $ | 771.3 | $ | 780.0 | $ | 786.6 | $ | 730.6 | |||||||||||||||
| 2019 First Lien Term Facility | 97.8 | 98.0 | 98.5 | 93.0 | |||||||||||||||||||
| 2017 Second Lien Term Facility | — | — | 310.0 | 241.8 | |||||||||||||||||||
| Revolving Facility | 2.7 | 2.7 | 142.6 | 142.6 | |||||||||||||||||||
| 2021 Revolving Facility | 37.3 | 37.3 | — | — | |||||||||||||||||||
| For the years ending December 31: | |||||
| Remaining 2021 | $ | 31.2 | |||
| 2022 | 132.9 | ||||
| 2023 | 124.4 | ||||
| 2024 | 114.5 | ||||
| 2025 | 116.6 | ||||
| Thereafter | 2,281.7 | ||||
| Total minimum lease payments | 2,801.3 | ||||
| Less: amount representing interest | (1,853.3) | ||||
| Present value of net minimum lease payments | 948.0 | ||||
| Less: current portion | (40.7) | ||||
| Capital leases, net of current portion | $ | 907.3 | |||
| For the years ending December 31: | Lease receipts | Lease commitments(1) | |||||||||
| Remaining 2021 | $ | 3.1 | $ | 14.9 | |||||||
| 2022 | $ | 12.2 | $ | 59.7 | |||||||
| 2023 | $ | 12.2 | $ | 58.4 | |||||||
| 2024 | $ | 12.2 | $ | 56.3 | |||||||
| 2025 | $ | 12.2 | $ | 43.3 | |||||||
| Thereafter | $ | 16.3 | $ | 312.4 | |||||||
| Total minimum lease receipts/payments | $ | 68.2 | $ | 545.0 | |||||||
Recent Accounting Pronouncements
Management does not believe that any recently issued, but not yet effective, accounting pronouncement if currently adopted would havethree and nine months ended September 30, 2021 and 2020. The $64.4 million exit costs are included within restructuring, impairment, site closures and related costs in the condensed consolidated statements of operations. The remainder is included within cost of revenues, excluding depreciation and amortization in the condensed consolidated statements of operations.
| September 30, 2021 | December 31, 2020 | ||||||||||
| 2017 First Lien Term Facility due May 2024 | $ | 780.4 | $ | 786.6 | |||||||
| 2019 First Lien Term Facility due May 2024 | 97.8 | 98.5 | |||||||||
| 2017 Second Lien Term Facility due May 2025 | — | 310.0 | |||||||||
| Revolving Facility due November 2023 | 40.0 | 142.6 | |||||||||
| Less: unamortized debt issuance costs | (8.4) | (17.1) | |||||||||
| 909.8 | 1,320.6 | ||||||||||
| Less: current maturities of long-term debt | (9.2) | (9.1) | |||||||||
| Long-term debt, net current portion | $ | 900.6 | $ | 1,311.5 | |||||||
Note 3—Initial Public Offering
On September 14, 2020,subsidiary of the Company consummated its Initial Public Offering(the “Borrower”) entered into credit agreements for up to $1,275.0 million of 36,000,000 Units at $10.00 per Unit, generating gross proceedsborrowings under first and second lien credit agreements (collectively, the “Senior Secured Credit Facilities”). The Senior Secured Credit Facilities consist of $360.0(a) a first lien credit agreement providing for (i) a $150.0 million first lien multi-currency revolving credit facility (the “Revolving Facility”) and incurring offering costs(ii) (a) an $815.0 million first lien term loan borrowing (the “2017 First Lien Term Facility”), and (b) a second lien credit agreement providing for a $310.0 million second lien term loan credit borrowing (the "2017 Second Lien Term Facility"). On May 13, 2019, the Borrower borrowed an additional $100.0 million under the incremental first lien loan under the first lien credit agreement (the “2019 First Lien Term Facility”). On May 7, 2021, certain of approximately $23.0the lenders under the Revolving Facility entered into an amendment with Cyxtera pursuant to which they agreed to extend the maturity date for certain revolving commitments from May 1, 2022 to November 1, 2023. Under these terms of the amendment, $141.3 million inclusive of $16.2commitments under the existing Revolving Facility were exchanged for $120.1 million in deferred underwriting commissions.of commitments under a new revolving facility (the "2021 Revolving Facility"). The underwriters were granted a 45-day option from2021 Revolving Facility has substantially the same terms as Revolving Facility, except that the maturity date of the final prospectus relating2021 Revolving Facility is November 1, 2023. In connection with the amendment, the Company repaid $19.6 million of the
| For the years ending December 31: | Principal amount | ||||
| Remaining 2021 | $ | 2.2 | |||
| 2022 | $ | 11.8 | |||
| 2023 | $ | 46.4 | |||
| 2024 | $ | 857.8 | |||
| 2025 | $ | — | |||
| Total | $ | 918.2 | |||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
| Interest expense on debt, net of capitalized interest | $ | 11.6 | $ | 16.2 | $ | 44.1 | $ | 50.3 | |||||||||||||||
| Interest expense on capital leases | 25.1 | 24.7 | 76.1 | 73.1 | |||||||||||||||||||
| Amortization of deferred financing costs and fees | 6.4 | 1.5 | 9.1 | 4.4 | |||||||||||||||||||
| Total | $ | 43.1 | $ | 42.4 | $ | 129.3 | $ | 127.8 | |||||||||||||||
Each Unit consists of one share of Class A common stock, and one-sixth of one redeemable warrant (or 6,737,242 redeemable warrants in the aggregate, assuming no exerciseshares of the underwriters’ over-allotment option) (each, a “Detachable Redeemable Warrant”) and a contingent right to receive at least one-sixth of one redeemable warrant following the Initial Business Combination Redemption Time (as defined below) under certain circumstances and subject to adjustments (the “Distributable Redeemable Warrants”). Each Public Warrant (as defined below) entitles the holder to purchase one share ofSVAC Class A common stock at a price of $11.50 per share, subject to adjustment (see Note 6).
STARBOARD VALUE ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
The Company’s Certificate of Incorporation provides that, at the distribution time (as defined below), the Company will effect a distribution of a number of warrants equal to the number of Units issued in the Initial Public Offering multiplied by one-sixth (the “Aggregate Warrant Amount”) as follows: (i) to the extent that no Public Stockholders redeem their Public Shares in connectionshare. Simultaneously with the initial Business Combination, each Public Stockholder will receive one-sixth of one Distributable Redeemable Warrant per Public Share and (ii) to the extent that any Public Stockholders redeem any of their Public Shares in connection with the initial Business Combination, then (A) one-sixth of one Distributable Redeemable Warrant will be distributed per each Public Share that was not redeemed (the “Remaining Public Shares”) and (B) the warrants in an amount equal to the Aggregate Warrant Amount less the number of warrants distributed pursuant to the foregoing clause (A) will be distributed on a pro rata basis to (x) the holders of the Remaining Public Shares based on their percentage of Class A common stock held after redemptions and the issuance of any forward purchase shares, as Distributable Redeemable Warrants and (y) the holders of the forward purchase shares based on their percentage of Class A common stock held after redemptions and the issuance of any forward purchase shares, as private placement warrants. Public Stockholders who exercise their redemption rights are not entitled to receive any distribution of Distributable Redeemable Warrants in respect of such redeemed Public Shares. The right of any Public Stockholder to receive any additional Distributable Redeemable Warrants with respect to each Public Share they hold is contingent upon such share not being redeemed in connection with the initial Business Combination. The number of Distributable Redeemable Warrants to be distributed in respect of each share of unredeemed Class A common stock is contingent upon the aggregate number of Public Shares that are redeemed in connection with the initial Business Combination. The right to receive Distributable Redeemable Warrants will remain attached to the Class A common stock and will not be separately transferable, assignable or salable. The Distributable Redeemable Warrants will be distributed at the “distribution time,” which will be immediately after the Initial Business Combination Redemption Time and immediately before the closing of the initial Business Combination. The Distributable Redeemable Warrants, together with the Detachable Redeemable Warrants, are collectively referred to herein as the “Public Warrants”. The “Initial Business Combination Redemption Time” means the time at which the Company redeems the shares of Class A common stock that the holders thereof have elected to redeem in connection with the initial Business Combination, which will occur prior to the consummation of the initial Business Combination.
Note 4—Related Party Transactions
Founder Shares
On November 27, 2019, the Sponsor purchased 8,625,000 shares of the Company’s Class B common stock, par value $0.0001 per share (the “Founder Shares”), for an aggregate price of $25,000. In June 2020, the Sponsor transferred (i) 431,250 Founder Shares to Martin D. McNulty, Jr., the Company’s Chief Executive Officer and a member of the board of directors and (ii) 25,000 Founder Shares to each of Pauline J. Brown, Michelle Felman and Lowell Robinson. In July 2020, the Sponsor transferred 25,000 Founder Shares to Robert L. Greene. On September 9, 2020, the Company effected a 1.2:1 share capitalization, resulting in an aggregate of 10,350,000 shares of Class B common stock outstanding. All shares and associated amounts have been retroactively restated to reflect the share capitalization.
The Sponsor and the Company's Chief Executive Officer agreed to forfeit up to 1,350,000 Founder Shares to the extent that the over-allotment option was not exercised in full by the underwriters, so that the Founder Shares would represent 20.0% of the Company’sIPO, SVAC issued and outstanding shares after the Initial Public Offering. On September 23, 2020, upon the underwriters' partial exercise of the over-allotment, an aggregate of 244,137 Founder Shares were forfeited by the Sponsor and the Company’s Chief Executive Officer.
The Sponsor and the Company’s officers and directors agreed, subject to limited exceptions, not to transfer, assign or sell any of the Founder Shares until (A) one year after the date of the consummation of the initial Business Combination or (B) subsequent to the initial Business Combination, (x) if the closing price of the Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the initial Business Combination, or (y) the date on which the Company completes a liquidation, merger, capital stock exchange or other similar transaction that results in all of the Public Stockholders having the right to exchange their shares of common stock for cash, securities or other property.
STARBOARD VALUE ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Private Placement Warrants
Simultaneously with the closing of the Initial Public Offering, the Company consummated the Private Placement of 6,133,333 Private Placement Warrants to the Sponsor, at a pricepurchase shares of $1.50 per Private Placement Warrant, generating gross proceeds to the Company of $9.2 million. In connection with the underwriters’ partial exercise of their over-allotment option, the Sponsor purchased an additional 589,794 Private Placement Warrants, at a price of $1.50 per Private Placement Warrant, generating gross proceeds to the Company of approximately $0.9 million.
Each whole Private Placement Warrant is exercisable for one whole share ofits Class A common stock at a price of $11.50 per share. A portion ofshare to the proceeds fromSponsor and to SVAC’s underwriters. In July 2021, in connection with the sale of theBusiness Combination transaction described in Note 3, additional Public and Private Placement Warrants were issued to SVAC common stockholders, including the Sponsor was added to the proceeds from the Initial Public Offering held in the Trust Account. If the Company does not complete aForward Purchasers. At July 29, 2021 (the Business Combination within the Combination Period, thedate) and September 30, 2021, there were 11,620,383 Public Warrants and 8,576,940 Private Placement Warrants outstanding. The Public and Private Placement Warrants will expire worthless. The Private Placement Warrants will be non-redeemable for cash and exercisable on a cashless basis so long as they are held by the Sponsor or its permitted transferees.
The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of their Private Placement Warrants until 30 days afterfive years from the completion of the initial Business Combination.
Related Party Loans
On November 27, 2019, the Sponsor agreed to loan the Company an aggregate of up to $300,000 to cover expenses related to the Initial
In addition, in order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or 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 a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. 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. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1.5 million of such Working Capital Loans may be convertible into warrants at a price of $1.50 per warrant. The warrants would be identical to the Private Placement Warrants. 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. To date, the Company had no borrowings under the Working Capital Loans.
Administrative Services Agreement
The Company entered into an agreement that provides that, commencing on the date that the securities of the Company are first listed on The Nasdaq Stock Market LLC and continuing until the earlier of the Company’s consummation of a Business Combination or the Company’s liquidation, the Company will pay the Sponsor a total of $10,000 per month for office space, administrative and support services.
The Sponsor, the Company’s executive officers and directors or any of their respective affiliates will be reimbursed for any out-of-pocket expenses incurred in connection with activities on the Company’s behalf such as identifying potential target businesses and performing due diligence on suitable Business Combinations. The Company’s audit committee will review on a quarterly basis all payments that were made to the Sponsor, officers, directors or their affiliates and will determine which expenses and the amount of expenses that will be reimbursed. There is no cap or ceiling on the reimbursement of out-of-pocket expenses incurred by such persons in connection with activities on the Company’s behalf.
STARBOARD VALUE ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Note 5—Commitments and Contingencies
Forward Purchase Agreement
On September 9, 2020, certain clients of Starboard Value LP, a Delaware limited partnership, which are also the majority-owners of the Sponsor, entered into a forward purchase agreement (the “forward purchase agreement”) with the Company, pursuant to which such clients (the “forward purchasers”) will purchase shares of the Company’s Class A common stock (“forward purchase shares”) at a price equal to $9.50 per share, in a private placement that will close simultaneously with the closing of the initial Business Combination. At the closing, the forward purchasers will purchase the number of forward purchase shares from the Company that would result in net proceeds in an aggregate amount necessary to satisfy the aggregate payment obligations resulting from the exercise of redemption rights by holders of the Public Shares in connection with the initial Business Combination (the “Redemption Obligation”), subject to a maximum funding commitment by the forward purchasers of $100.0 million. In addition, in connection with their purchase of any forward purchase shares, the forward purchasers will acquire private placement warrants at the distribution time. The forward purchasers have agreed that they will not redeem any Class A common stock held by them in connection with the initial Business Combination. The forward purchase shares are identical to the shares of Class A common stock included in the Units, except that the forward purchase shares are subject to transfer restrictions and certain registration rights, as described herein, and there is no contingent right to receive Distributable Redeemable Warrants attached to the forward purchase shares. Rather, in connection with their purchase of any forward purchase shares, the forward purchasers will acquire private placement warrants.
Optional Share Purchase Agreement
In addition, on September 9, 2020, the Company entered into an agreement with the forward purchasers, pursuant to which the forward purchasers may, at their option in whole or in part, anytime or from time to time during the 6-month period following the closing of the initial Business Combination, purchase additional common equity of the surviving entity in the initial Business Combination at a price of $10.00 per share (or other relevant equity interest) (the “optional shares”) for aggregate consideration not to exceed the difference between (i) $150.0 million and (ii) the lesser of (a) the Redemption Obligation or (b) $100.0 million (the “optional share purchase agreement”).
Registration Rights
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. However, the registration rights agreement provides that the Company will not permit any registration statement filed under the Securities Act to become effective until the termination of the applicable lock-up period for the securities to be registered. The Company will bear the expenses incurred in connection with the filing of any such registration statements.
Pursuant to the forward purchase agreement, the Company has agreed to use its commercially reasonable efforts to (i) within 30 days after the closing of the initial Business Combination, file a registration statement with the SEC for a secondary offering of the forward purchase shares and any private placement warrants (including the shares of common stock issuable upon exercise thereof) issued to the forward purchasers, (ii) cause such registration statement to be declared effective promptly thereafter, but in no event later than 60 days after such closing and (iii) maintain the effectiveness of such registration statement, until the earlier of (A) the date on which the forward purchasers cease to hold the securities covered thereby and (B) the date all of the securities covered thereby can be sold publicly without restriction or limitation under Rule 144 under the Securities Act and without the requirement to be in compliance with Rule 144(c)(1) under the Securities Act, subject to certain conditions and limitations set forth in the forward purchase agreement. The Company will bear the costs of registering the forward purchase shares and private placement warrants. The optional share purchase agreement provides that the forward purchasers are entitled to certain registration rights with respect to their optional shares.
STARBOARD VALUE ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Underwriting Agreement
The underwriters were entitled to an underwriting discount of $0.20 per Unit, and were paid approximately $8.1 million in the aggregate, upon the closing of the Initial Public Offering and the sale of Over-Allotment Units. The underwriters agreed and paid approximately $2.0 million to the Company to reimburse certain of the Company’s expenses in connection with the Initial Public Offering and the sale of Over-Allotment Units.
An additional fee of $0.45 per Unit, or $18.2 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 the Company completes a Business Combination, subject to the terms of the underwriting agreement.
Deferred Legal Fees
The Company obtained legal advisory service with a legal counsel firm in connection with the Initial Public Offering and agreed to pay the legal counsel firm an amount of $250,000 solely in the event that the Company completes a Business Combination.
Note 6—Stockholders’ Equity
Preferred stock — The Company is authorized to issue 1,000,000 shares of preferred stock, par value $0.0001 per share, with such designations, voting and other rights and preferences as may be determined from time to time by the Company’s board of directors. As of September 30, 2020 and December 31, 2019, there were no shares of preferred stock issued or outstanding.
Class A common stock — The Company is authorized to issue 200,000,000 shares of Class A common stock with a par value of $0.0001 per share. As of September 30, 2020, there were 40,423,453 shares of Class A common stock outstanding, including 38,349,052 shares of Class A common stock subject to possible redemption that were classified as temporary equity in the accompanying condensed balance sheet. As of December 31, 2019, there were no shares of Class A common stock issued or outstanding.
Class B common stock — The Company is authorized to issue 20,000,000 shares of Class B common stock with a par value of $0.0001 per share. In November 2019, the Company issued 8,625,000 shares of Class B common stock. On September 9, 2020, the Company effected a share capitalization, resulting in an aggregate of 10,350,000 shares of Class B common stock outstanding. All shares and associated amounts have been retroactively restated to reflect the share capitalization. The Sponsor and the Company's Chief Executive Officer agreed to forfeit up to 1,350,000 Founder Shares to the extent that the over-allotment option was not exercised in full by the underwriters so that the Founder Shares would represent 20.0% of the Company’s issued and outstanding shares after the Initial Public Offering. On September 23, 2020, upon the underwriters' partial exercise of the over-allotment, an aggregate of 244,137 Founder Shares were forfeited by the Sponsor and the Company’s Chief Executive Officer. As of September 30, 2020 and December 31, 2019, there were 10,105,863 and 10,350,000 shares of Class B common stock outstanding, respectively.
Prior to the initial Business Combination, only holders of the Company’s Class B common stock will have the right to vote on the election of directors. Holders of the Class A common stock will not be entitled to vote on the election of directors during such time. These provisions of the Certificate of Incorporation may only be amended if approved by the holders of at least 90% of the Company’s common stock entitled to vote thereon. With respect to any other matter submitted to a vote of the Company’s stockholders, including any vote in connection with the initial Business Combination, except as required by applicable law or stock exchange rule, holders of the Company’s Class A common stock and holders of the Company’s Class B common stock will vote together as a single class, with each share entitling the holder to one vote.
The Class B common stock will automatically convert into Class A common stock at the time of the initial Business Combination on a one-for-one basis, subject to adjustment. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts sold in the Initial Public Offering and related to the closing of the initial Business Combination (other than the forward purchase shares and the private placement warrants delivered pursuant to the forward purchase agreement), the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such anti-dilution adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the total number of all shares of common stock outstanding upon completion of the Initial Public Offering plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with the initial Business Combination (net of the number of shares of Class A common stock redeemed in connection with the initial Business Combination), excluding the forward purchase shares and private placement warrants delivered pursuant to the forward purchase agreement, any shares or equity-linked securities issued, or to be issued, to any seller in the initial Business Combination and any Private Placement Warrants issued upon the conversion of Working Capital Loans made to the Company.
STARBOARD VALUE ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Warrants — Public Warrants may only be exercised for a whole number of shares. No fractional Public Warrants will be issued upon separation ofIn September 2021 we filed the Units and only whole Public Warrants will trade. The Public Warrants will become exercisableRegistration Statement on Form S-1 for, among other things, the later of (a) 30 days after the completion of a Business Combination or (b) 12 months from the closing of the Initial Public Offering; provided in each case that the Company has an effective registration, statement under the Securities Act coveringof 1933, as amended, of the sharesissuance of Class A common stock issuable upon exercise of the Public Warrants and a current prospectus relating to them is available (or the Company permits holders to exercise their Public Warrants on a cashless basis and such cashless exercise is exempt from registration under the Securities Act). The Company has agreed that as soon as practicable, but in no event later than 15 business days, after the closing of a Business Combination, the Company will use its reasonable best efforts to file with the SEC a registration statement for the registration, under the Securities Act, of the shares of Class A common stock issuable upon exercise of the PublicPrivate Placement Warrants. The Company will use its reasonable best efforts to cause the same to become effectivePublic and to maintain the effectiveness of such registration statement, and a current prospectus relating thereto, until the expiration of the Public Warrants in accordance with the provisions of the warrant agreement. Notwithstanding the above, if the Class A common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of Public Warrants who exercise their warrants to do so on a “cashless” basis, and, in the event the Company so elects, the Company will not be required to file or maintain in effect a registration statement, but the Company will be required to use its reasonable best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. The Public Warrants will expire five years after the completion of a Business Combination or earlier upon redemption or liquidation.
The Private Placement Warrants are identical to the Public Warrants, except that the Private Placement Warrants and the shares of Class A common stock issuable upon exercise of the Private Placement Warrants will not be transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will be non-redeemable so long as they are heldgoverned by the Sponsor or its permitted transferees. If the Private Placement Warrants are held by someone other than the Sponsor or its permitted transferees, the Private Placement Warrants will be redeemable byterms of that certain Warrant Agreement, dated September 9, 2020 (the “Warrant Agreement”), between the Company and exercisable by such holders on the same basis as the Public Warrants.
Once the warrants become exercisable, theContinental Stock Transfer & Trust Company (the “Warrant Agent”).
Warrant Agreement.
STARBOARD VALUE ACQUISITION CORP.
(Unaudited) (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) on the trading day prior to the date on which the Company sends notice of redemption to the warrant holders; •if, and only if, the Private Placement Warrants also concurrently exchanged at the same price (equal to a described above; and •if and only if, there is an effective registration statement covering the issuance of the shares of Class A |
The exercise price and number of common stock issuable upon exercise of the
In no event will the Company be required to net cash settle any warrant. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds heldfair value of warrant liabilities in other expense in the Trust Account, holderscondensed consolidated statement of warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with the respect to such warrants. Accordingly, the warrants may expire worthless.
Note 7—Fair Value Measurements
operations.
| Quoted Prices in Active Markets | Significant Other Observable Inputs | Significant Other Unobservable Inputs | ||||||||||
| Description | (Level 1) | (Level 2) | (Level 3) | |||||||||
| Investments held in Trust Account: | ||||||||||||
| U.S. Treasury Securities | $ | 404,258,816 | $ | - | $ | - | ||||||
| $ | 404,258,816 | $ | - | $ | - | |||||||
STARBOARD VALUE ACQUISITION CORP.
(continued)
| (in millions) | Public Warrants (Level 1) | Private Warrants (Level 3) | Total | |||||||||||||||||
| Balance at the beginning of the period | $ | — | $ | — | $ | — | ||||||||||||||
| Warrant liabilities assumed on July 29, 2021 | 23.2 | 18.6 | 41.8 | |||||||||||||||||
| Change in the fair value of the warrant liabilities | 0.7 | 2.0 | 2.7 | |||||||||||||||||
| Balance at the end of the period | $ | 23.9 | $ | 20.6 | $ | 44.5 | ||||||||||||||
Transfers to/from Levelsthe Private Placement Warrants at September 30, 2021 and July 29, 2021 (the date the warrant obligation was assumed by Cyxtera) using the Monte Carlo simulation model are as follows:
| Inputs | As of September 30, 2021, | As of July 29, 2021 | ||||||||||||
| Risk free interest rate | 0.94 | % | 0.73 | % | ||||||||||
| Volatility for Least-Square Monte Carlo Model | 55.0 | % | 35.7 | % | ||||||||||
| Expected Term in Years | 4.8 | 5.0 | ||||||||||||
| Fair Value of Class A Common Stock | $ | 9.25 | $ | 9.55 | ||||||||||
Investments held2021.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
| Costs of revenues, excluding depreciation and amortization | $ | — | $ | 0.2 | $ | 0.2 | $ | 0.5 | |||||||||||||||
| Selling, general, and administrative expenses | 1.8 | 1.6 | 5.2 | 5.2 | |||||||||||||||||||
| Total | $ | 1.8 | $ | 1.8 | $ | 5.4 | $ | 5.7 | |||||||||||||||
| Stock Options Granted during the Periods Ended | ||||||||
| September 30, 2021 | ||||||||
| Expected term (in years) | 6.1 | |||||||
| Expected stock volatility | 30.7 | % | ||||||
| Risk-free interest rate | 0.87 | % | ||||||
| Stock price at grant date | $ | 8.65 | ||||||
| Exercise price | $ | 9.55 | ||||||
| Dividend yield | — | % | ||||||
| Shares Subject to Options | Weighted Average Exercise Price per Share | Weighted Average Remaining Contractual Life (Years) | Aggregate Intrinsic Value | ||||||||||||||||||||
| Outstanding from January 1, 2020 to June 30, 2021 | — | — | — | — | |||||||||||||||||||
| Granted | 849,233 | $ | 9.55 | ||||||||||||||||||||
| Exercised | — | — | |||||||||||||||||||||
| Expired/forfeited | — | — | |||||||||||||||||||||
| Outstanding at September 30, 2021 | 849,233 | $ | 9.55 | 9.9 | — | ||||||||||||||||||
| Exercisable, September 30, 2021 | — | — | — | — | |||||||||||||||||||
| Unvested and expected to vest, September 30, 2021 | 849,233 | $ | 9.55 | 9.9 | — | ||||||||||||||||||
Management has evaluated subsequent events15. Income taxes
| September 30, 2021 | December 31, 2020 | ||||||||||
| Beginning balance | $ | 30.0 | $ | 127.7 | |||||||
| Provision for loan losses | — | 19.4 | |||||||||
| Reversal of allowance | — | (117.1) | |||||||||
| Net reversal of allowance for loan losses | — | (97.7) | |||||||||
| Write offs | (30.0) | — | |||||||||
| Ending balance | $ | — | $ | 30.0 | |||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||||||
Revenues (1) | $ | 0.2 | $ | 0.3 | $ | 0.8 | $ | 0.7 | ||||||||||||
Selling, general and administrative expenses (2) | — | (0.1) | (0.1) | (0.1) | ||||||||||||||||
(Recovery) impairment of notes receivable from affiliate (3) | — | 9.4 | — | 18.2 | ||||||||||||||||
Other income, net (4) | — | — | 0.1 | 4.2 | ||||||||||||||||
| December 31, 2020 | ||||||||
Accounts receivable (1) | $ | 4.3 | ||||||
Due from affiliates (2) | $ | 117.1 | ||||||
Accounts payable (3) | $ | 0.4 | ||||||
Accrued expenses (4) | $ | 0.5 | ||||||
Due to affiliates (5) | $ | 22.7 | ||||||
References in this Quarterly Report on Form 10-Q, (this “Quarterly Report”) toand the “Company,” “our,” “us” or “we” refer to Starboard Value Acquisition Corp. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the unaudited condensedconsolidated financial statements and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained inPart I, Item I of the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.
Registration Statement on Form S-1.
including without limitation the Risk Factors contained in our Registration Statement on Form S-1.
of Cyxtera's Business
Our registration statements for our initial public offering (the “Initial Public Offering”) became effective on September 9, 2020. Legacy Cyxtera and Starboard Value Acquisition Company
Simultaneously withcombined company following the closing of the InitialBusiness Combination and satisfying one of the conditions to the closing. Additionally, as a result of the Business Combination, 10,526,315 shares of Class A common stock were issued to the Forward Purchasers at a price of $9.50 per share, for aggregate consideration of $100 million and 10,105,863 shares of SVAC Class B common stock held by the Sponsor, automatically converted to 10,105,863 shares of Class A common stock.
Upon the closing of the Initial Public Offering, the Private Placement, from the sale of the Over-Allotment Unitsforward purchase shares, we received approximately $493 million in total cash from the Business Combination, before fees, expenses and debt repayment.
If we are unable to complete a Business Combination within 24 months from the closing of the Initial Public Offering, or September 14, 2022 (the “Combination Period”), weNasdaq-listed company, which 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 torequire us to pay our franchisehire additional staff and income taxes (less upimplement procedures and processes to $100,000 of interest to pay dissolution expenses), divided by the number of then-outstanding Public Shares, which redemption will completely extinguish the Public Stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law,address public company regulatory requirements and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.
Results of Operations
Our entire activity since inception through September 30, 2020 related to our formation, the preparation for the Initial Public Offering, and since the closing of the Initial Public Offering, the search for a prospective initial Business Combination. We have neither engaged in any operations nor generated any revenues to date. We will not generate any operating revenues until after completion of our initial Business Combination. We will generate non-operating income in the form of interest income on cash and cash equivalents.customary practices. We expect to incur substantial additional annual expenses for, among other things, directors’ and officers’ liability insurance, director fees and additional internal and external costs for investor relations, accounting, audit, legal and other functions.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
| Revenues | |||||||||||||||||||||||
| Recurring revenue | $ | 169.3 | $ | 163.5 | $ | 501.2 | $ | 493.5 | |||||||||||||||
| Non-recurring revenues | 7.8 | 8.5 | 24.1 | 24.2 | |||||||||||||||||||
| Total | $ | 177.1 | $ | 172.0 | $ | 525.3 | $ | 517.7 | |||||||||||||||
| Bookings | $ | 1.8 | $ | 1.7 | $ | 6.9 | $ | 5.1 | |||||||||||||||
| Churn | $ | 1.1 | $ | 1.8 | $ | 4.3 | $ | 5.0 | |||||||||||||||
| Three Months Ended September 30, | |||||||||||||||||||||||
| 2021 | 2020 | $ Change | % Change | ||||||||||||||||||||
| Revenues | $ | 177.1 | $ | 172.0 | $ | 5.1 | 3 | % | |||||||||||||||
| Operating costs and expenses: | |||||||||||||||||||||||
| Cost of revenues, excluding depreciation and amortization | 93.5 | 97.3 | (3.8) | (4) | % | ||||||||||||||||||
| Selling, general and administrative expenses | 29.2 | 24.5 | 4.7 | 19 | % | ||||||||||||||||||
| Depreciation and amortization | 59.4 | 57.5 | 1.9 | 3 | % | ||||||||||||||||||
| Restructuring, impairment, site closures, and related costs | 1.4 | — | 1.4 | 100 | % | ||||||||||||||||||
| Transaction - related costs | 5.2 | — | 5.2 | 100 | % | ||||||||||||||||||
| Impairment of notes receivable and other amounts due from affiliate | — | 9.4 | (9.4) | (100) | % | ||||||||||||||||||
| Total operating costs and expenses | 188.7 | 188.7 | — | — | % | ||||||||||||||||||
| Loss from operations | (11.6) | (16.7) | 5.1 | (31) | % | ||||||||||||||||||
| Interest expense, net | (43.1) | (42.4) | (0.7) | 2 | % | ||||||||||||||||||
| Other expenses, net | (0.4) | (1.4) | 1.0 | (71) | % | ||||||||||||||||||
Change of fair value of warrant liabilities | (2.7) | — | (2.7) | 100 | % | ||||||||||||||||||
| Loss from continuing operations before income taxes | (57.8) | (60.5) | 2.7 | (4) | % | ||||||||||||||||||
| Income tax benefit | 11.1 | 14.6 | (3.5) | (24) | % | ||||||||||||||||||
| Net loss | $ | (46.7) | $ | (45.9) | $ | (0.8) | 2 | % | |||||||||||||||
Foradditional borrowings during the term of the Promissory Notes for additional amounts not to exceed approximately $52.5 million in the aggregate (approximately $147.7 million including the initial aggregate principal amount).
| Nine Months Ended September 30, | |||||||||||||||||||||||
| 2021 | 2020 | $ Change | % Change | ||||||||||||||||||||
| Revenues | $ | 525.3 | $ | 517.7 | $ | 7.6 | 1 | % | |||||||||||||||
| Operating costs and expenses: | |||||||||||||||||||||||
| Cost of revenues, excluding depreciation and amortization | 287.4 | 287.3 | 0.1 | — | % | ||||||||||||||||||
| Selling, general and administrative expenses | 79.7 | 81.4 | (1.7) | (2) | % | ||||||||||||||||||
| Depreciation and amortization | 180.6 | 172.4 | 8.2 | 5 | % | ||||||||||||||||||
| Restructuring, impairment, site closures, and related costs | 68.4 | — | 68.4 | 100 | % | ||||||||||||||||||
| Transaction- related costs | 5.2 | — | 5.2 | 100 | % | ||||||||||||||||||
| Impairment of note receivable and other amounts due from affiliate | — | 18.2 | (18.2) | (100) | % | ||||||||||||||||||
| Total operating costs and expenses | 621.3 | 559.3 | 62.0 | 11 | % | ||||||||||||||||||
| Loss from operations | (96.0) | (41.6) | (54.4) | 131 | % | ||||||||||||||||||
| Interest expense, net | (129.3) | (127.8) | (1.5) | 1 | % | ||||||||||||||||||
| Other expenses, net | (1.2) | (2.1) | 0.9 | (43) | % | ||||||||||||||||||
| Change of fair value of warrant liabilities | (2.7) | — | (2.7) | 100 | % | ||||||||||||||||||
| Loss from operations before income taxes | (229.2) | (171.5) | (57.7) | 34 | % | ||||||||||||||||||
| Income tax benefit | 36.9 | 22.7 | 14.2 | 63 | % | ||||||||||||||||||
| Net loss | $ | (192.3) | $ | (148.8) | $ | (43.5) | 29 | % | |||||||||||||||
Forprofessional consulting fees of $2.1 million. The costs were offset by an increase to payroll related expenses of $3.6 million due to salary rate increases.
rate. The income tax benefit on the pre-tax loss for the nine months ended September 30, 2020 was different than the amount expected at the statutory federal income tax rate primarily as a result of additional state income tax benefits, which were partially offset by valuation allowances recorded on certain deferred tax assets in the U.S. and foreign jurisdictions, non-deductible equity compensation, foreign withholding taxes, and the remeasurement of the Company’s net deferred tax assets in the U.K. due to an enacted tax rate change.
Our liquidity needs to date have been satisfied throughBusiness Combination, we repaid the paymententire balance owed under the Second Lien Term Facility of $25,000 from our Sponsor to purchase$310.0 million and amounts owed under the Founder Shares (as defined below), the loan of approximately $141,000 under a promissory note from our Sponsor (the “Note”),Revolving Facility and the net proceeds from2021 Revolving Facility of $123.1 million. Since the consummation of the Private Placement not heldBusiness Combination we have borrowed $40.0 million from the Revolving Facility and the 2021 Revolving Facility all of which is currently outstanding.
| Nine Months Ended September 30, | ||||||||||||||
| 2021 | 2020 | |||||||||||||
| Net cash provided by operating activities | $ | 0.8 | $ | 85.4 | ||||||||||
| Net cash used in investing activities | 73.0 | (73.4) | ||||||||||||
| Net cash provided by financing activities | (125.2) | 57.4 | ||||||||||||
| Remaining 2021 | 2022 | 2023 | 2024 | 2025 | Thereafter | Total | |||||||||||||||||||||||||||||||||||
Long-term debt, excluding the Revolving Facility (1) | $ | 2.2 | $ | 11.8 | $ | 46.4 | $ | 857.8 | $ | — | $ | — | $ | 918.2 | |||||||||||||||||||||||||||
| Revolving Facility | — | 2.7 | 37.3 | — | — | — | 40.0 | ||||||||||||||||||||||||||||||||||
Interest (2) | 9.7 | 38.2 | 37.4 | 11.8 | — | — | 97.2 | ||||||||||||||||||||||||||||||||||
Capital leases and other financing obligations (3) | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Operating leases (3) | 14.9 | 59.7 | 58.4 | 56.3 | 43.3 | 312.4 | 545.0 | ||||||||||||||||||||||||||||||||||
Purchase obligations (4) | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Asset retirement obligations (5) | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
| $ | 26.8 | $ | — | $ | 179.5 | $ | 925.9 | $ | 43.3 | $ | 312.4 | $ | — | ||||||||||||||||||||||||||||
Based on2021, as well as the foregoing, management believes that we will have sufficient workingcredit facility fee for the Revolving Facility.
We continue to evaluate the impact of the COVID-19 pandemic and have concluded that the specific impact is not readily determinableCompany was contractually committed as of the date of the balance sheet. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Contractual Obligations
September 30, 2021.
Critical Accounting Policies
This management’sEstimates
Class A Common Stock Subject to Possible Redemption
Class A common stock subject to mandatory redemption (if any) is classified as liability instruments and measured at fair value. Conditionally redeemable Class A common stock (including Class A common stock that features redemption rights that are either withinyear ended December 31, 2020 in the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, Class A common stock is classified as stockholders’ equity. Our Class A common stock features certain redemption rights that are considered to be outsideRegistration Statement on Form S-1 registration statement for a complete description of our control and subjectsignificant accounting policies.
Net Income (Loss) Per Common Share
Net loss per share is computed by dividing net loss by the weighted-average number of common stock outstanding during the periods. We have not considered the effect of the warrants sold in the Initial Public Offering and the Private Placement to purchase the Company’s Class A common stock in the calculation of diluted income per share, since their inclusion would be anti-dilutive under the treasury stock method.
Our unaudited condensed consolidated financial statements of operations include a presentation of net income (loss) per share for common stock subject to redemptionincluded elsewhere in a manner similar to the two-class method of income per share. Net income per common share, basic and diluted for Class A common stock is calculated by dividing the net gainthis Quarterly Report on investment securities held in the Trust Account, net of applicable taxes available to be withdrawn from the Trust Account by the weighted average number of Class A common stock outstanding for each period. Net loss per common share, basic and diluted for Class B common stock is calculated by dividing the net loss, less income attributable to Class A common shares by the weighted average number of Class B common shares outstanding for the period.
RecentForm 10-Q.
Our management does not believe that any recently issued, but not yet effective, accounting standards if currently adopted would have a material effect on the accompanying financial statements.
Off-Balance Sheet Arrangements
As of September 30, 2020, we did not have any off-balance sheet arrangements
the JOBS Act
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 underAct. Under the JOBS Act, are allowed to comply withemerging growth companies can delay adopting new or revised accounting pronouncements based onstandards issued subsequent to the effective date forenactment of the JOBS Act until such time as those standards apply to private (not publicly traded) companies. We have elected to delay the adoption of new or revised accounting standards, and as a result, we may not complyuse this extended transition period for complying with new or revised accounting standards onthat have different effective dates for public and private companies until the relevant dates on which adoptionearlier of such standards is required for non-emergingthe date we (i) are no longer an emerging growth companies.company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, theour 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 of the Sarbanes-Oxley Act of 2002, (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 Public Company Accounting Oversight Board (United States) 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 chief executive officer’s compensation to median employee compensation. These exemptions will apply for a period of five years following the completion of our Initial Public Offering or until we are no longer an “emerging growth company,” whichever is earlier.
Item 3. Quantitative |
We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item.
| Qualitative Disclosures About Market Risk Not Applicable. Item 4. |
Evaluation of Disclosure Controls and Procedures
Under the supervision
must reflect the fact that there are resource constraints, and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.
There was
ITEM 1A.RISK FACTORSThere have been no material changes from the risk factors previously disclosed in the Company’s final prospectus for the Initial Public Offering as filed with the SEC on September 11, 2020.ITEM 2.UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
share. The Private Placement Warrants On September 14, 2020, we of Equity Securities and Use of Proceedsour Initial Public Offeringthe PIPE Investment and issued 25,000,000 shares of 36,000,000 Units. On September 23, 2020, inClass A common stock to the PIPE Purchasers for aggregate consideration of $250 million, or $10 per share. Also at the closing, the Company issued 10,526,315 shares of Class A common stock to the Forward Purchasers for aggregate consideration of $100 million, or $9.50 per share. In connection with underwriters’ electionthe Forward Purchase, the Company issued 1,853,813 Private Placement Warrants to partially exercise their over-allotment option, we sold anthe Forward Purchasers for no additional 4,423,453 Units. The Units were sold at an offering price of $10.00 per Unit, generating total gross proceeds of $404,234,530.consideration. Each Unit consists ofwhole Private Placement Warrant is exercisable for one whole share of Class A common stock and one-sixth of one redeemable warrant (the “Detachable Redeemable Warrants”). In addition, each share of Class A common stock issued in the Initial Public Offering carries a contingent right to receive at least one-sixth of one redeemable warrant following the Initial Business Combination Redemption Time under certain circumstances and subject to adjustment (the “Distributable Redeemable Warrants”, and with the Detachable Redeemable Warrants, the “Redeemable Warrants”). UBS Securities LLC, Stifel, Nicolaus & Company, Incorporated and Cowen and Company, LLC acted as the book running managers of the offering. The securities sold in the offering were registered under the Securities Act on a registration statement on Form S-1 (No. 333-248094), which the SEC declared effective on September 9, 2020, and a related registration statement on Form S-1MEF (No. 333-248699), which became effective on the same date.Simultaneously with the closing of the Initial Public Offering, the Company completed the private sale of an aggregate of 6,133,333 Private Placement Warrants to the Sponsor, at a purchase price of $1.50$11.50 per Private Placement Warrant, generating gross proceeds to the Company of $9,200,000. In connection with the underwriters’ partial exercise of their over-allotment option, the Sponsor purchased an additional 589,794 Private Placement Warrants, generating gross proceeds to the Company of $884,691. Such securities were issued pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act.are identical to the Redeemable Warrants underlying the Units sold in the Initial Public Offering, except that,will be non-redeemable for cash and exercisable on a cashless basis so long as they are held by the SponsorForward Purchasers or itstheir permitted transferees: (1) they will not be redeemabletransferees.Company, except as otherwise set forth in the Company’s prospectus; (2) they (including theSponsor automatically converted to shares of Class A common stock issuable upon exerciseas of the Private Placement Warrants) may not, subject to certain limited exceptions, be transferred, assigned or sold byclosing for no additional consideration.Sponsor, until 30 days after the completionforegoing securities under Section 4(a)(2) of the Company’s initial business combination; (3) they may be exercised bySecurities Act and/or Rule 506 of Regulation D promulgated under the holders onSecurities Act, as a cashless basis;transaction not requiring registration under Section 5 of the Securities Act. The parties receiving the securities represented their intentions to acquire the securities for investment only and (4) the holders thereof (includingnot with respecta view to or for sale in connection with any distribution, and appropriate restrictive legends were affixed to the shares of common stock issuable upon exercise ofcertificates representing the Private Placement Warrants) are entitled to registration rights.Of the gross proceeds received from the Initial Public Offering, the partial exercise of the over-allotment option and the Private Placement Warrants, $404,234,530 was placedsecurities (or reflected in the Trust Account.Use of ProceedsWe paid a total of approximately $7.9 million underwriting discounts and commissions (excluding the deferred portion) and approximately $7.1 million for other offering costs and expenses related to the Initial Public Offering. In connectionrestricted book entry with the Initial Public Offering, we incurred offering costs of approximately $25.7 million, inclusive of $18.2 million in deferred underwriting commissions. Other incurred offering costs consisted principally of preparation fees relatedCompany’s transfer agent). The parties also had adequate access, through business or other relationships, to information about the Initial Public Offering. After deducting the underwriting discounts and commissions (excluding the deferred portion, which amount will be payable upon consummation of the Initial Business Combination, if consummated) and the Initial Public Offering expenses, approximately $404.2 million of the net proceeds of the sale of the Units in the Initial Public Offering, the Private Placement, the Over-Allotment Units and the additional Private Placement Warrants were placed in the Trust Account. The net proceeds of the Initial Public Offering and certain proceeds from the sale of the Private Placement Warrants are held in the Trust Account and invested as described elsewhere in this Quarterly Report.
Company.22There has been no material change in the planned use of the proceeds from the Initial Public Offering and Private Placement as is described in the Company’s final prospectus related to the Initial Public Offering.ITEM 3.DEFAULTS UPON SENIOR SECURITIESapplicable.ITEM 5.OTHER INFORMATIONNone.
Applicable23ITEM 6.EXHIBITSThe following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report.*Filed herewith.**Furnished.(1)Previously filed as an exhibit to our Current Report on Form 8-K filed on September 14, 2020 and incorporated by reference herein.��
Item 6. Exhibits24Exhibit Number Description Incorporation by Reference Form Exhibit Filing Date Filed Herewith 2.1 Agreement and Plan of Merger, dated as of February 21, 2021, by and among Starboard Value Acquisition Corp., Mundo Merger Sub 1, Inc., Mundo Merger Sub 2, LLC, Cyxtera Technologies, Inc. and Mundo Holdings, Inc. 8-K 2/22/2021 3.1 Second Amended and Restated Certificate of Incorporation. 8-K 8/4/2021 3.2 Amended and Restated By-Laws 8-K 8/4/2021 4.1 Specimen Class A Common Stock Certificate of Starboard Value Acquisition Corp. S-1/A 8/28/2020 4.2 Specimen Warrant Certificate of Starboard Value Acquisition Corp. S-1/A 8/28/2020 4.3 Warrant Agreement, dated September 9, 2020, by and between SVAC and Continental Stock Transfer & Trust Company, as warrant agent. S-1/A 9/08/2020 4.4 Specimen Class A Common Stock Certificate of Cyxtera Technologies, Inc. 8-K 8/04/2021 10.1 Form of Indemnification Agreement. # 8-K 8/04/2021 10.2 2021 Incentive Award Plan. # 8-K 8/04/2021 10.3 Forms of award agreements under the Cyxtera Technologies, Inc. 2021 Omnibus Incentive Plan.# S-8 10/01/2021 10.4 Form of Amended and Restated Registration Rights Agreement by and among certain stockholders. 8-K 8/04/2021 10.5 Stockholders Agreement, dated July 29, 2021, by and among Cyxtera Technologies, Inc., a Delaware corporation (f/k/a Starboard Value Acquisition Corp.), SIS Holdings LP, BCEC-Cyxtera Technologies Holdings (Guernsey) L.P., Medina Capital Fund II –SIS Holdco, L.P. and SVAC Sponsor LLC 8-K 8/04/2021 31.1 X 31.2 X 32.1 X 32.2 X 101.DEF XBRL Instance Document- the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document X 101.PRE Inline XBRL Taxonomy Extension Presentation Document X 101.LAB Inline XBRL Taxonomy Extension Labels Document X 101.CAL Inline XBRL Taxonomy Extension Calculation Document X 101.SCH Inline XBRL Taxonomy Extension Schema Document X 101.INS XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document X 104 Cover Page Interactive Data File - the cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. X authorized.authorizedSTARBOARD VALUE ACQUISITION CORP/s/ Carlos Sagasta Carlos Sagasta Date: November 16, 2020/s/ Martin D. McNulty, Jr.Name:Martin D. McNulty, Jr.Title:Chief Executive Officer(Principal Executive Officer)Date: November 16, 2020/s/ Kenneth R. MarlinName:Kenneth R. MarlinTitle:Chief Financial Officer (Principal Financial and Accounting Officer)25