☒ | QUARTERLY 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 |
CORP
.Cayman Islands | 98-1550179 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
PO Box 1093, Boundary Hall, Cricket Square, Grand Cayman Cayman Islands | KY1-1102 | ||
(Address of principal executive offices) | (Zip Code) |
which registered
Large, accelerated filer | ☐ | Accelerated filer | ☐ | |||
Non-accelerated filer | ☒ | Smaller reporting company | ☒ | |||
Emerging growth company | ☒ |
Page | ||||||||||
Item 1. | ||||||||||
| Financial Statements | |||||||||
1 | ||||||||||
2 | ||||||||||
3 | ||||||||||
4 | ||||||||||
Unaudited Notes to Condensed Financial Statements | 5 | |||||||||
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | |||||||||
Item 3. | ||||||||||
Item 4. | ||||||||||
Item 1. | ||||||||||
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Item 1A. | ||||||||||
Item 2. | ||||||||||
Item 3. | ||||||||||
Item 4. | ||||||||||
Item 5. | ||||||||||
Item 6. | ||||||||||
SHEETS
September 30, 2021 | December 31, 2020 | |||||||
(Unaudited) | ||||||||
ASSETS | ||||||||
Current assets | ||||||||
Cash | $ | 300,410 | $ | 1,194,821 | ||||
Prepaid expenses | 512,689 | 20,949 | ||||||
Total Current Assets | 813,099 | 1,215,770 | ||||||
Investments held in Trust Account | 600,035,972 | 600,008,617 | ||||||
TOTAL ASSETS | $ | 600,849,071 | $ | 601,224,387 | ||||
LIABILITIES AND SHAREHOLDERS’ DEFICIT | ||||||||
Current liabilities | ||||||||
Accounts payable and accrued expenses | $ | 107,807 | $ | 2,250 | ||||
Accrued offering costs | 0 | 3,193 | ||||||
Advances from related party | 468,236 | 0 | ||||||
Total Current Liabilities | 576,043 | 5,443 | ||||||
FPA liabilities | 1,024,994 | 8,483,278 | ||||||
Warrant liabilities | 28,600,000 | 66,440,000 | ||||||
Deferred underwriting fee payable | 21,000,000 | 21,000,000 | ||||||
Total Liabilities | 51,201,037 | 95,928,721 | ||||||
Commitments and Contingencies | 0 | 0 | ||||||
Class A ordinary shares subject to possible redemption, 60,000,000 shares at $10.00 per share as of September 30, 2021 and December 31, 2020 | 600,000,000 | 600,000,000 | ||||||
Shareholders’ Deficit | ||||||||
Preference shares, $0.0001 par value; 5,000,000 shares authorized; 0 non-redeemable shares issued and outstanding | 0— | 0— | ||||||
Class A ordinary shares, $0.0001 par value; 500,000,000 shares authorized; NaN issued or outstanding and that it excludes shares subject to redemption. | 0 | 0 | ||||||
Class B ordinary shares, $0.0001 par value; 50,000,000 shares authorized; 15,000,000 shares issued and outstanding at September 30, 2021, and December 31, 2020 | 1,500 | 1,500 | ||||||
Additional paid-in capital | 0 | 0 | ||||||
Accumulated deficit | (50,353,466 | ) | (94,705,834 | ) | ||||
Total Shareholders’ Deficit | (50,351,966 | ) | (94,704,334 | ) | ||||
TOTAL LIABILITIES AND SHAREHOLDERS’ DEFICIT | $ | 600,849,071 | $ | 601,224,387 | ||||
Three Months Ended September 30, 2021 | Nine Months Ended September 30, 2021 | For the Period from July 24, 2020 (inception) through September 30, 2020 | ||||||||||
Operating costs | $ | 274,019 | $ | 973,271 | $ | 8,130 | ||||||
Loss from operations | (274,019 | ) | (973,271 | ) | (8,130 | ) | ||||||
Other income: | ||||||||||||
Interest earned on investments held in Trust Account | 9,219 | 27,355 | — | |||||||||
Change in fair value of warrant liabilities | 17,160,000 | 37,840,000 | — | |||||||||
Change in fair value of FPA liabilities | 1,291,669 | 7,458,284 | — | |||||||||
Total other income | 18,460,888 | 45,325,639 | — | |||||||||
Net income (loss) | $ | 18,186,869 | $ | 44,352,368 | $ | (8,130 | ) | |||||
Weighted average shares outstanding, Class A ordinary shares | 60,000,000 | 60,000,000 | — | |||||||||
Basic and diluted net income per share, Class A ordinary shares | $ | 0.24 | $ | 0.59 | $ | — | ||||||
Weighted average shares outstanding, Class B ordinary shares | 15,000,000 | 15,000,000 | 15,000,000 | |||||||||
Basic and diluted net income per share, Class B ordinary shares | $ | 0.24 | $ | 0.59 | $ | — | ||||||
Class A Ordinary Shares | Class B Ordinary Shares | Additional Paid-in | Accumulated | Total Shareholders’ | ||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||||||||
Balance — December 31, 2020 | 0 | $ | 0 | 15,000,000 | $ | 1,500 | $ | 0 | $ | (94,705,834 | ) | $ | (94,704,334 | ) | ||||||||||||||
Net income | — | — | — | — | — | 24,902,196 | 24,902,196 | |||||||||||||||||||||
Balance — March 31, 2021 | 0 | $ | 0 | 15,000,000 | $ | 1,500 | $ | 0 | $ | (69,803,638 | ) | $ | (69,802,138 | ) | ||||||||||||||
Net income | — | — | — | — | — | 1,263,303 | 1,263,303 | |||||||||||||||||||||
Balance — June 30, 2021 | 0 | $ | 0 | 15,000,000 | $ | 1,500 | $ | 0 | $ | (68,540,335 | ) | $ | (68,538,835 | ) | ||||||||||||||
Net income | — | — | — | — | — | 18,186,869 | 18,186,869 | |||||||||||||||||||||
Balance — September 30, 2021 | 0 | $ | 0 | 15,000,000 | $ | 1,500 | $ | 0 | $ | (50,353,466 | ) | $ | (50,351,966 | ) | ||||||||||||||
(unaudited)
ASSETS | ||||
Current asset — cash | $ | 22,865 | ||
Deferred offering costs | 503,454 | |||
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TOTAL ASSETS | $ | 526,319 | ||
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LIABILITIES AND SHAREHOLDER’S EQUITY | ||||
Current liabilities | ||||
Accrued expenses | $ | 5,630 | ||
Accrued offering costs | 246,351 | |||
Promissory notes — related party | 257,468 | |||
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Total Liabilities | 509,449 | |||
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Commitments and Contingencies | ||||
Shareholder’s Equity | ||||
Preference shares, $0.0001 par value; 5,000,000 shares authorized; none issued and outstanding | ||||
Class A ordinary shares, $0.0001 par value; 500,000,000 shares authorized; none issued and outstanding | ||||
Class B ordinary shares, $0.0001 par value; 50,000,000 shares authorized; 17,250,000 shares issued and outstanding (1) | 1,725 | |||
Additional paid-in capital | 23,275 | |||
Accumulated deficit | (8,130 | ) | ||
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Total Shareholder’s Equity | 16,870 | |||
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TOTAL LIABILITIES AND SHAREHOLDER’S EQUITY | $ | 526,319 | ||
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Class A Ordinary Shares | Class B Ordinary Shares | Additional Paid-in Capital | Accumulated Deficit | Total Shareholder’s Equity | ||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||
Balance — July 24, 2020 (inception) | — | $ | — | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||||||||||
Issuance of Class B ordinary shares to Sponsor (1) | — | — | 17,250,000 | 1,725 | 23,275 | — | 25,000 | |||||||||||||||||||||
Net loss | — | — | — | — | — | (8,130 | ) | (8,130 | ) | |||||||||||||||||||
Balance — September 30, 2020 | — | $ | — | 17,250,000 | $ | 1,725 | $ | 23,275 | $ | (8,130 | ) | $ | 16,870 | |||||||||||||||
(1) |
Included an aggregate of up to 2,250,000 Class B ordinary shares that |
FOR THE PERIOD FROM JULY 24, 2020 (INCEPTION) THROUGH SEPTEMBER 30, 2020
CASH FLOWS
Formation and operating costs | $ | 8,130 | ||
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Net Loss | $ | (8,130 | ) | |
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Weighted average shares outstanding, basic and diluted (1) | 15,000,000 | |||
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Basic and diluted net loss per ordinary shares | $ | (0.00 | ) | |
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Nine months Ended September 30, | For the Period from July 24, 2020 (inception) Through September 30, | |||||||
2021 | 2020 | |||||||
Cash Flows from Operating Activities: | ||||||||
Net income (loss) | $ | 44,352,368 | $ | (8,130 | ) | |||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||||||||
Change in fair value of warrant liability | (37,840,000 | ) | — | |||||
Change in fair value of FPA liability | (7,458,284 | ) | ||||||
Interest earned on investments held in Trust Account | (27,355 | ) | — | |||||
Changes in operating assets and liabilities: | ||||||||
Prepaid expenses | (491,740 | ) | — | |||||
Accounts payable and accrued expenses | 105,557 | 5,630 | ||||||
Net cash used in operating activities | (1,359,454 | ) | (2,500 | ) | ||||
Cash Flows from Financing Activities: | ||||||||
Advances from - related party | 468,236 | 100,000 | ||||||
Payment of offering costs | (3,193 | ) | (74,635 | ) | ||||
Net cash provided by financing activities | 465,043 | 25,365 | ||||||
Net Change in Cash | (894,411 | ) | 22,865 | |||||
Cash – Beginning of period | 1,194,821 | 0 | ||||||
Cash – End of period | $ | 300,410 | $ | 22,865 | ||||
Non-Cash investing and financing activities: | ||||||||
Offering costs included in accrued offering costs | $ | — | $ | 246,351 | ||||
Offering costs paid by Sponsor in exchange for issuance of founder shares | $ | — | $ | 25,000 | ||||
Offering costs paid through promissory note | $ | — | $ | 157,468 | ||||
CONDENSED STATEMENT OF CHANGES IN SHAREHOLDER’S EQUITY
FOR THE PERIOD FROM JULY 24, 2020 (INCEPTION) THROUGH SEPTEMBER 30, 2020
(Unaudited)
Class B Ordinary Shares | Additional Paid-in Capital | Accumulated Deficit | Total Shareholder’s Equity | |||||||||||||||||
Shares | Amount | |||||||||||||||||||
Balance — July 24, 2020 (inception) | — | $— | $— | $— | $— | |||||||||||||||
Issuance of Class B ordinary shares to Sponsor (1) | 17,250,000 | 1,725 | 23,275 | — | 25,000 | |||||||||||||||
Net loss | — | — | — | (8,130 | ) | (8,130 | ) | |||||||||||||
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Balance — September 30, 2020 | 17,250,000 | $ | 1,725 | $ | 23,275 | $ | (8,130 | ) | $ | 16,870 | ||||||||||
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The accompanying notes are an integral part of these unaudited condensed financial statements.
AVANTI ACQUISITION CORP.
CONDENSED STATEMENT OF CASH FLOWS
FOR THE PERIOD FROM JULY 24, 2020 (INCEPTION) THROUGH SEPTEMBER 30, 2020
(Unaudited)
Cash Flows from Operating Activities: | ||||
Net loss | $ | (8,130 | ) | |
Changes in operating assets and liabilities: | ||||
Accrued expenses | 5,630 | |||
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Net cash used in operating activities | (2,500 | ) | ||
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Cash Flows from Financing Activities: | ||||
Proceeds from promissory note — related party | 100,000 | |||
Payment of offering costs | (74,635 | ) | ||
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Net cash used in operating activities | 25,365 | |||
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Net Change in Cash | 22,865 | |||
Cash — Beginning | — | |||
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Cash — Ending | $ | 22,865 | ||
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Non-cash investing and financing activities: | ||||
Deferred offering costs included in accrued offering costs | $ | 246,351 | ||
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Deferred offering costs paid by Sponsor in exchange for the issuance of Class B ordinary shares | $ | 25,000 | ||
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Deferred offering costs paid through promissory note — related party | $ | 157,468 | ||
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The accompanying notes are an integral part of these unaudited condensed financial statements.
2021
Note 1 — Description of Organization and Business Operations
4.
5.
AVANTI ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2020
(Unaudited)
Trust Account (excluding the amount of deferred underwriting discounts and taxes payable on the income earned) at the time of the signing of the agreement to enter into a Business Combination. The Company will only complete a Business Combination if the post business combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. There is no assurance that the Company will be able to complete a Business Combination successfully.
AVANTI ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2020
(Unaudited)
Company’s initial Business Combination or to redeem 100% of the Public Shares if the Company does not complete its initial Business Combination within 24 months from the closing of the Initial Public Offering or (B) with respect to any other provision relating to the rights of holders of the Public Shares.
2021
Note 2 — Summary
the revision on the Company’s condensed financial statements is reflected in the following table.
Balance Sheet as of December 31, 2020 (audited) | As Previously Reported | Adjustment | As Revised | |||||||||
Class A ordinary shares subject to possible redemption | $ | 500,295,660 | $ | 99,704,340 | $ | 600,000,000 | ||||||
Class A ordinary shares | $ | 997 | $ | (997 | ) | $ | — | |||||
Additional paid-in capital | $ | 30,753,192 | $ | (19,983,155 | ) | $ | — | |||||
Accumulated deficit | $ | (25,755,683 | ) | $ | (79,720,188 | ) | $ | (94,705,834 | ) | |||
Total Shareholders’ Equity (Deficit) | $ | 5,000,006 | $ | (99,704,340 | ) | $ | (97,704,334 | ) |
AVANTI ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2020
(Unaudited)
liabilities and disclosure of contingent assets and liabilities at the date of the condensed financial statements and the reported amounts of revenues and expenses during the reporting period.
Deferred Offering Costs
Deferred offering costs consist of legal, accounting2021 and other expenses incurred throughDecember 31, 2020.
Company’s control and subject to occurrence of uncertain future events. Accordingly, at September 30, 2021 and December 31, 2020, Class A ordinary shares subject to possible redemption are presented as temporary equity, outside of the shareholders’ equity section of the Company’s condensed balance sheets.
Gross proceeds | $ | 600,000,000 | ||
Less: | ||||
Proceeds allocated to Public Warrants | $ | (37,500,000 | ) | |
Class A ordinary shares issuance costs | (31,473,651 | ) | ||
Plus: | ||||
Accretion of carrying value to redemption value | $ | 68,973,651 | ||
Class A ordinary shares subject to possible redemption | $ | 600,000,000 | ||
The Company’s management does not expect that the total amount of unrecognized benefits will materially change over the next twelve months.
Three Months Ended September 30, 2021 | Nine Months Ended September 30, 2021 | For the Period from July 24, 2020 (inception) Through September 30, 2020 | ||||||||||||||||||||||
Class A | Class B | Class A | Class B | Class A | Class B | |||||||||||||||||||
Basic and diluted net income (loss) per ordinary share | ||||||||||||||||||||||||
Numerator: | ||||||||||||||||||||||||
Allocation of net income (loss), as adjusted | $ | 14,549,495 | $ | 3,637,374 | $ | 35,481,894 | $ | 8,870,474 | $ | 0 | $ | (8,130 | ) | |||||||||||
Denominator: | ||||||||||||||||||||||||
Basic and diluted weighted average shares outstanding | 60,000,000 | 15,000,000 | 60,000,000 | 15,000,000 | 0 | 15,000,000 | ||||||||||||||||||
Basic and diluted net income per ordinary share | $ | 0.24 | $ | 0.24 | $ | 0.59 | $ | 0.59 | $ | 0 | $ | 0 |
AVANTI ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2020
(Unaudited)
$250,000. $250,000. The Company has not experienced losses on this account and management believes the Company is not exposed to significant risks on such account.
nature, except for the Warrants and FPA (see Note 10).
Note 3 — Initial Public Offering
Note 4 — Related Party Transactions
forfeiture of 2,250,000 Founder Shares. Accordingly, as of September 30, 2021 and December 31, 2020, there were 15,000,000 Founder Shares issued and outstanding.
AVANTI ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2020
(Unaudited)
of $14,000,000. The Sponsor has agreed to purchase up to an additional 1,800,000 Private Placement Warrants, at a price of $1.00 per Private Placement Warrant, or an aggregate additional $1,800,000, to the extent the underwriter’s over-allotment option is exercised in full. Each Private Placement Warrant is exercisable to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment. A portion of the proceeds from the Private Placement Warrants were added to the proceeds from the Initial Public Offering held in the Trust Account. If the Company does not complete a Business Combination within the Combination Period, the proceeds of the sale of the Private Placement Warrants will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law), and the Private Placement Warrants and all underlying securities will expire worthless.
Advance from Related Party
Subsequent to the quarter end, the Sponsor advanced $957,468 to the Company in order to fund the Company’s ongoing working capital needs. The advances are non-interest bearing and due on demand. As of September 30, 2020, there were no advances outstanding.
October 16, 2020. Borrowings under the Promissory Note are no longer available.
Note 5 — CommitmentsLoans, respectively.
are due on demand.
AVANTI ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2020
(Unaudited)
financial position, the results of its operations and/or search for a target company, the specific impact is not readily determinable as of the date of these condensed financial statements. The condensed financial statements do not include any adjustments that might result from the outcome of this uncertainty.
The Company granted the underwriters a 45-day option from the date of the Initial Public Offering to purchase up to 9,000,000 additional Units to cover over-allotments, if any, at the Initial Public Offering price less the underwriting discounts and commissions.
In connection with the closing of the Initial Public Offering and the option to purchase additional Units, the underwriters were paid a cash underwriting discount of $0.20 per Unit, or $12,000,000 in the aggregate.
Agreement
2021
Note 6 — Shareholder’s Equity
and outstanding, which are presented as temporary equity.
outstanding.
The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of the Business Combination or earlier at the option of the holders thereof on a
AVANTI ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2020
(Unaudited)
share upon exercise of a Public Warrant unless the Class A ordinary share issuable upon such warrant exercise has been registered, qualified or deemed to be exempt under the securities laws of the state of residence of the registered holder of the warrants.
at $0.10 per warrant upon a minimum of |
AVANTI ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30 2020
(Unaudited)
|
AVANTI ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2020
(Unaudited)
completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and be (except
Note 7 — Subsequent Events
Description | Level | September 30, 2021 | December 31, 2020 | |||||||||||||
Assets: | ||||||||||||||||
Investments held in Trust Account | 1 | $ | 600,035,972 | $ | 600,008,617 | |||||||||||
Liabilities: | ||||||||||||||||
Warrant Liabilities — Public Warrants | 1 | $ | 19,500,000 | $ | 45,300,000 | |||||||||||
Warrant Liabilities — Private Placement Warrants | 2 | $ | 9,100,000 | $ | 21,140,000 | |||||||||||
FPA Liability | 3 | $ | 1,024,994 | $ | 8,483,278 |
September 30, 2021 | December 31, 2020 | |||||||
Risk-free interest rate | 0.05 | % | 0.10 | % | ||||
Time to expiration, in Years | 0.33 | 0.83 | ||||||
Unit price | $ | 10.10 | $ | 10.84 | ||||
Forward Price | $ | 10.00 | $ | 10.00 |
FPA | ||||
Fair value as of December 31, 2020 | $ | 8,483,278 | ||
Change in fair value | (7,458,284 | ) | ||
Fair value as of September 30, 2021 | $ | 1,024,994 | ||
ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
Liquidity
As of September 30, 2020,Liquidity
Subsequentability to continue as a going concern. No adjustments have been made to the endcarrying amounts of the quarterly period covered by this Quarterly Report, onassets or liabilities should we be required to liquidate after October 6, 2022.
or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating
Pursuant to a registration and shareholder rights agreement entered into on October 6, 2020, the holders of the Founder Shares, Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans (and any Class A ordinary shares issuable upon the exercise of the Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans) will be entitled to registration rights. The holders of these securities are entitled to make up to three demands, excluding short form demands, that we register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of a Business Combination. However, the registration and shareholder rights agreement provides that we will not permit any registration statement filed under the Securities Act to become effective until termination of the applicable lockup period. We will bear the expenses incurred in connection with the filing of any such registration statements
ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET-RISK |
ITEM 4. | CONTROLS AND PROCEDURES |
The material weakness discussed below was remediated during the quarter ended September 30, 2021.
ITEM 1. | LEGAL PROCEEDINGS. |
ITEM 1A. | RISK FACTORS. |
ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS. |
ITEM 3. | DEFAULTS UPON SENIOR SECURITIES. |
ITEM 4. | MINE SAFETY DISCLOSURES. |
ITEM 5. | OTHER INFORMATION. |
ITEM 6. | EXHIBITS |
* | Filed herewith. |
** | Furnished. |
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AVANTI ACQUISITION CORP. | ||||||
Date: November | /s/ Nassef Sawiris | |||||
Name: | Nassef Sawiris | |||||
Title: | Chief Executive Officer | |||||
(Principal Executive Officer) | ||||||
/s/ Johann Dumas | ||||||
Name: | Johann Dumas | |||||
Title: | Chief Financial Officer | |||||
(Principal Financial Officer and Accounting Officer) |
23