☒ | 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 |
Cayman Islands | 001-39639 | 98-1556204 | ||
(State or other jurisdiction of incorporation or organization) | (Commission File Number) | ( Identification |
| 33131 | |
(Address | (Zip Code) |
code(code) Ordinary Share,ordinary Ordinary Sharesordinary shares included as part of the units each whole warrant exercisable for one Class A Ordinary Share at an exercise price of $11.50
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
Non-accelerated filer | ☒ | Smaller reporting company | ☒ | |||
Emerging growth company | ☒ |
Acquisition Corp. (the “Company,” “we”, “our” or “us”) is filing this Amendment No. 1 to the Quarterly Report on
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Item | 21 | |||||||
Item 1A. | 22 | |||||||
Item 2. | ||||||||
Item 3. | ||||||||
Item 4. | ||||||||
Item 5. | ||||||||
Item 6. | ||||||||
Item 1. | Financial Statements |
SEPTEMBER 30, 2020
Assets | ||||
Current assets: | ||||
Prepaid expenses | $ | 4,967 | ||
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Total current assets | 4,967 | |||
Deferred offering costs associated with initial public offering | 495,755 | |||
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Total assets | $ | 500,722 | ||
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Liabilities and Shareholders’ Equity | ||||
Current liabilities: | ||||
Accounts payable | $ | 30,255 | ||
Accrued expenses | 259,000 | |||
Note payable - related party | 206,500 | |||
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Total current liabilities | 495,755 | |||
Commitments and Contingencies | ||||
Shareholders’ Equity | ||||
Preference shares, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding | — | |||
Class A ordinary shares, $0.0001 par value; 400,000,000 shares authorized; none issued and outstanding | — | |||
Class B ordinary shares, $0.0001 par value; 40,000,000 shares authorized; 9,343,750 shares issued and outstanding (1)(2) | 934 | |||
Additional paid-in capital | 24,066 | |||
Accumulated deficit | (20,033 | ) | ||
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Total shareholders’ equity | 4,967 | |||
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Total Liabilities and Shareholders’ Equity | $ | 500,722 | ||
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SHEETS
September 30, 2021 | December 31, 2020 | |||||||
(Unaudited) | ||||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash | $ | 4,386 | $ | 30,103 | ||||
Prepaid expenses | 609,967 | 1,096,949 | ||||||
Total current assets | 614,353 | 1,127,052 | ||||||
Investments held in Trust Account | 363,978,513 | 363,951,287 | ||||||
Total assets | $ | 364,592,866 | $ | 365,078,339 | ||||
LIABILITIES AND SHAREHOLDERS’ DEFICIT | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 1,615,714 | $ | 58,206 | ||||
Accrued expenses | 289,009 | 98,579 | ||||||
Due to related party | 21,683 | 0 | ||||||
Total current liabilities | 1,926,406 | 156,785 | ||||||
Deferred underwriting commissions | 12,738,075 | 12,738,075 | ||||||
Derivative warrant liabilities | 12,573,087 | 23,995,840 | ||||||
Total liabilities | 27,237,568 | 36,890,700 | ||||||
Commitments and Contingencies (Note 6) | 0 | 0 | ||||||
Class A ordinary shares subject to possible redemption, 36,394,500 shares at redemption value of $10 per share | 363,945,000 | 363,945,000 | ||||||
Shareholders’ Deficit | ||||||||
Preference shares, $0.0001 par value; 1,000,000 shares authorized; NaN issued and outstanding | 0— | 0— | ||||||
Class A ordinary shares, $0.0001 par value; 950,000,000 shares authorized; NaN issued or outstanding (excluding 36,394,500 shares subject to possible redemption) | 0 | 0 | ||||||
Class B ordinary shares, $0.0001 par value; 95,000,000 shares authorized; 9,098,625 shares issued and outstanding | 910 | 910 | ||||||
Additional paid-in capital | 0 | 0 | ||||||
Accumulated deficit | (26,590,612 | ) | (35,758,271 | ) | ||||
Total shareholders’ deficit | (26,589,702 | ) | (35,757,361 | ) | ||||
Total Liabilities and Shareholders’ Deficit | $ | 364,592,866 | $ | 365,078,339 | ||||
FOR THE PERIOD FROM SEPTEMBER 2, 2020 (INCEPTION) THROUGH SEPTEMBER 30, 2020
General and administrative expenses | $ | 20,033 | ||
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Net loss | $ | (20,033 | ) | |
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Weighted average shares outstanding, basic and diluted (1)(2) | 9,098,625 | |||
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Basic and diluted net loss per share | $ | (0.00 | ) | |
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Three Months Ended September 30, 2021 | Nine Months Ended September 30, 2021 | For The Period From September 2, 2020 (inception) through September 30, 2020 | ||||||||||
General and administrative expenses | $ | 356,234 | $ | 2,192,319 | $ | 20,033 | ||||||
Administrative expenses - related party | 30,000 | 90,000 | 0 | |||||||||
Loss from operations | (386,234 | ) | (2,282,319 | ) | (20,033 | ) | ||||||
Interest income from investments held in Trust Account | 9,176 | 27,225 | 0 | |||||||||
Change in fair value of derivative warrant liabilities | 8,308,783 | 11,422,753 | 0 | |||||||||
Net Income (Loss) | $ | 7,931,725 | $ | 9,167,659 | $ | (20,033 | ) | |||||
Weighted average shares outstanding of Class A ordinary shares | 36,394,500 | 36,394,500 | 0 | |||||||||
Basic and diluted net income (loss) per share, Class A ordinary shares | $ | 0.17 | $ | 0.20 | $ | 0.00 | ||||||
Weighted average shares outstanding of Class B ordinary shares | 9,098,625 | 9,098,625 | 9,098,625 | |||||||||
Basic and diluted net income per share, Class B ordinary shares | $ | 0.17 | $ | 0.20 | $ | 0.00 | ||||||
Ordinary Shares | ||||||||||||||||||||
Class B | ||||||||||||||||||||
Shares | Amount | Additional Paid- In Capital | Accumulated Deficit | Total Shareholders’ Deficit | ||||||||||||||||
Balance - January 1, 2021 | 9,098,625 | $ | 910 | $ | 0 | $ | (35,758,271 | ) | $ | (35,757,361 | ) | |||||||||
Net income | — | — | 0— | 3,455,249 | 3,455,249 | |||||||||||||||
Balance - March 31, 2021 (unaudited) | 9,098,625 | $ | 910 | $ | 0 | $ | (32,303,022 | ) | $ | (32,302,112 | ) | |||||||||
Net loss | — | — | 0— | (2,219,315 | ) | (2,219,315 | ) | |||||||||||||
Balance - June 30, 2021 (unaudited) | 9,098,625 | $ | 910 | $ | 0 | $ | (34,522,337 | ) | $ | (34,521,427 | ) | |||||||||
Net income | — | — | 0— | 7,931,725 | 7,931,725 | |||||||||||||||
Balance - September 30, 2021 (unaudited) | 9,098,625 | $ | 910 | $ | 0 | $ | (26,590,612 | ) | $ | (26,589,702 | ) | |||||||||
Ordinary Shares | ||||||||||||||||||||||||||||
Class A | Class B | Additional Paid-in Capital | Accumulated Deficit | Total Shareholders’ Equity | ||||||||||||||||||||||||
Shares | Amount | Shares (1)(2) | Amount | |||||||||||||||||||||||||
Balance - September 2, 2020 (inception) | — | $ | — | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||
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Issuance of Class B ordinary shares to Sponsor | — | — | 9,343,750 | 934 | 24,066 | — | 25,000 | |||||||||||||||||||||
Net loss | — | — | — | — | — | (20,033 | ) | (20,033 | ) | |||||||||||||||||||
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Balance - September 30, 2020 (unaudited) | — | $ | — | 9,343,750 | $ | 934 | $ | 24,066 | $ | (20,033 | ) | $ | 4,967 | |||||||||||||||
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Ordinary Shares | ||||||||||||||||||||
Class B | ||||||||||||||||||||
Shares | Amount | Additional In Capital | Accumulated Deficit | Total Shareholders’ Deficit | ||||||||||||||||
Balance as of September 3, 2020 (inception) | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | |||||||||||
Issuance of ordinary shares to Sponsor | 9,098,625 | 910 | — | — | 910 | |||||||||||||||
Net loss | — | — | 0— | (20,033 | ) | (20,033 | ) | |||||||||||||
Balance as of September 30, 2020 (unaudited) | 9,098,625 | $ | 910 | $ | 0 | $ | (20,033 | ) | $ | (19,123 | ) | |||||||||
FOR THE PERIOD FROM SEPTEMBER 2, 2020 (INCEPTION) THROUGH SEPTEMBER 30, 2020
Cash Flows from Operating Activities: | ||||
Net loss | $ | (20,033 | ) | |
Changes in operating assets and liabilities: | ||||
Prepaid expenses | 20,033 | |||
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Net cash used in operating activities | — | |||
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Net change in cash | — | |||
Cash - beginning of the period | — | |||
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Cash - end of the period | $ | — | ||
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Supplemental disclosure of noncash investing and financing activities: | ||||
Deferred offering costs included in accounts payable | $ | 30,255 | ||
Deferred offering costs included in accrued expenses | $ | 259,000 | ||
Deferred offering costs included in note payable - related party | $ | 206,500 | ||
Prepaid expenses paid by Sponsor in exchange for issuance of Class B ordinary shares | $ | 25,000 |
Nine Months Ended September 30, 2021 | For The Period From September 2, 2020 (inception) through September 30, 2020 | |||||||
Cash Flows from Operating Activities: | ||||||||
Net income (loss) | $ | 9,167,659 | $ | (20,033 | ) | |||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||||||||
Change in fair value of derivative warrant liabilities | (11,422,753 | ) | — | |||||
Interest income from investments held in Trust Account | (27,225 | ) | — | |||||
General and administrative expenses paid by Sponsor in exchange for issuance of Class B ordinary shares | — | 20,033 | ||||||
Changes in operating assets and liabilities: | ||||||||
Prepaid expenses | 486,981 | — | ||||||
Accounts payable | 1,557,508 | — | ||||||
Accrued expenses | 190,430 | — | ||||||
Net cash used in operating activities | (47,400 | ) | 0 | |||||
Cash Flows from Financing Activities: | ||||||||
Advances from related party | 21,683 | — | ||||||
Net cash provided by financing activities | 21,683 | — | ||||||
Net decrease in cash | (25,717 | ) | — | |||||
Cash - beginning of period | 30,103 | — | ||||||
Cash - end of period | $ | 4,386 | $ | — | ||||
Supplemental disclosure of noncash investing and financing activities: | ||||||||
Deferred offering costs included in accounts payable | $ | $ | 30,255 | |||||
Deferred offering costs included in accrued expenses | $ | $ | 259,000 | |||||
Deferred offering costs paid through promissory note — related party | $ | $ | 206,500 | |||||
Deferred offering costs paid through the issuance of ordinary shares to Sponsor | $ | $ | 25,000 | |||||
H.I.G. ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
distributed to Public Shareholders 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). These Public Shares have been classified as temporary equity in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” In such case, the Company will proceed with a Business Combination if the Company has net tangible assets of at least $5,000,001 upon such consummation of a Business Combination, only if a majority of the ordinary shares, represented in person or by proxy and entitled to vote thereon, voted at a shareholder meeting are voted in favor of the Business Combination. If a shareholder vote is not required by law or stock exchange listing requirements and the Company does not decide to hold a shareholder vote for business or other reasons, the Company will, pursuant to the amended and restated memorandum and articles of association (the “Amended and Restated Memorandum and Articles of Association”), conduct the redemptions pursuant to the tender offer rules of the U.S. Securities and Exchange Commission (“SEC”) and file tender offer documents with the SEC prior to completing a Business Combination. If, however, shareholder approval of the transactions is required by law, or the Company decides to obtain shareholder approval for business or other reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer rules. Additionally, each Public Shareholder may elect to redeem their Public Shares irrespective of whether they vote for or against or vote at all for the proposed transaction. If the Company seeks shareholder approval in connection with a Business Combination, the Company’s Sponsor and each member of the Company’s management team have agreed to vote their Founder Shares (as defined below in Note 4)5) and any Public Shares purchased during or after the Initial Public Offering in favor of a Business Combination.
H.I.G. ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
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 in the Trust Account will be less than the $10.00 per share initially held in the Trust Account. In order to protect the amounts held in the Trust Account, the Sponsor has agreed that it will be liable to the Company if and to the extent any claims by a third party for services rendered or products sold to the Company, or a prospective target business with which the Company has entered into a written letter of intent, confidentiality or other similar agreement or business combinationBusiness Combination 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 as of the date of the liquidation of the Trust Account, if less than $10.00 per share due to reductions in the value of the Trust assets, in each case net of the interest that may be withdrawn to pay the Company’s tax obligations, provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the Trust Account (whether or not such waiver is enforceable) nor will it apply 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”). Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims. 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 (other than 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.
presentation
2021.
2021.
The Company is an “emerging growth company” as defined in Section 2(a) of
H.I.G. ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Risk
On January 30, 2020,Class A ordinary shares.
Liquidity and capital resources
As of September 30, 2020, the Company had no cash and working capital deficit of approximately $491,000.
The Company’s liquidity needs to date have been satisfied through a contribution of $25,000 from the Sponsor to cover certain of the Company’s expenses in exchange for the issuance of the Founder Shares (as defined in Note 4), a loan of up to $300,000 from the Sponsor under a promissory note (the “Note”), of which approximately $206,000 was outstanding at September 30, 2020 (see Note 4), and the proceeds from the consummation of the Private Placement not heldis reflected in the Trust Account occurring subsequent to September 30, 2020. The Company repaid the following table.
As of March 31, 2021 | ||||||||||||
Condensed Balance Sheet | As Previously Reported | Restatement Adjustment | As Restated | |||||||||
Class A ordinary shares subject to possible redemption | $ | 326,642,880 | $ | 37,302,120 | $ | 363,945,000 | ||||||
Shareholders’ Equity | ||||||||||||
Class A ordinary shares, $0.0001 par value | $ | 373 | $ | (373 | ) | $ | — | |||||
Class B ordinary shares, $0.0001 par value | $ | 910 | $ | — | $ | 910 | ||||||
Additional paid-in capital | $ | 11,186,032 | $ | (11,186,032 | ) | $ | — | |||||
Accumulated deficit | $ | (6,187,307 | ) | $ | (26,115,715 | ) | $ | (32,303,022 | ) |
Three Months Ended March 31, 2021 | ||||||||||||
Condensed Statement of Operations | As Previously Reported | Restatement Adjustment | As Restated | |||||||||
Weighted average shares outstanding of Class A ordinary shares | 36,394,500 | — | 36,394,500 | |||||||||
Basic and diluted net income per ordinary share, Class A | $ | — | $ | 0.08 | $ | 0.08 | ||||||
Weighted average shares outstanding of Class B ordinary shares | 9,098,625 | — | 9,098,625 | |||||||||
Basic and diluted net loss per ordinary share, Class B | $ | 0.38 | $ | (0.30 | ) | $ | 0.08 |
As of June 30, 2021 | ||||||||||||
Condensed Balance Sheet | As Previously Reported | Restatement Adjustment | As Restated | |||||||||
Class A ordinary shares subject to possible redemption | $ | 324,423,570 | $ | 39,521,430 | $ | 363,945,000 | ||||||
Shareholders’ equity (deficit) | ||||||||||||
Class A ordinary shares, $0.0001 par value | $ | 395 | $ | (395 | ) | $ | — | |||||
Class B ordinary shares, $0.0001 par value | $ | 910 | $ | — | $ | 910 | ||||||
Additional paid-in capital | $ | 13,405,320 | $ | (13,405,320 | ) | $ | — | |||||
Accumulated deficit | $ | (8,406,622 | ) | $ | (26,115,715 | ) | $ | (34,522,337 | ) |
Three Months Ended June 30, 2021 | ||||||||||||
Condensed Statement of Operations | As Previously Reported | Restatement Adjustment | As Restated | |||||||||
Weighted average shares outstanding of Class A ordinary shares | 36,394,500 | — | 36,394,500 | |||||||||
Basic and diluted net loss per ordinary share, Class A | $ | — | $ | (0.05 | ) | $ | (0.05 | ) | ||||
Weighted average shares outstanding of Class B ordinary shares | 9,098,625 | — | 9,098,625 | |||||||||
Basic and diluted net loss per ordinary share, Class B | $ | (0.24 | ) | $ | 0.19 | $ | (0.05 | ) |
Six Months Ended June 30, 2021 | ||||||||||||
Condensed Statement of Operations | As Previously Reported | Restatement Adjustment | As Restated | |||||||||
Weighted average shares outstanding of Class A ordinary shares | 36,394,500 | — | 36,394,500 | |||||||||
Basic and diluted net income per ordinary share, Class A | $ | — | $ | 0.03 | $ | 0.03 | ||||||
Weighted average shares outstanding of Class B ordinary shares | 9,098,625 | — | 9,098,625 | |||||||||
Basic and diluted net loss per ordinary share, Class B | $ | 0.13 | $ | (0.10 | ) | $ | 0.03 |
Based on the foregoing, management believes that the Company will have sufficient working capital and borrowing capacity 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 held outside of the Trust Account for paying existing 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.
Note 2—3 — Summary of Significant Accounting Policies
H.I.G. ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Deferred sheets, except for derivate warrant liabilities (see Note 8).
Deferred offering
the listed market price of such warrants.
Recent Accounting Pronouncements
impact, if any,
H.I.G. ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
As of September 30, 2021, the related party note is no longer available to the Company.
H.I.G. ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. 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. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $4.5 million of such Working Capital Loans may be convertible into warrants of the post Business Combination entity at a price of $1.50 per warrant. The warrants would be identical to the Private Placement Warrants. As of October 23,September 30, 2021 and December 31, 2020, the Company had no$0 borrowings under the Working Capital Loans.
The
For the three and nine months ended September 30, 2021, the Company incurred approximately $30,000 and $90,000, respectively, for these services which is included in Administrative expenses — related party on the accompanying condensed statements of operations. There was approximately $114,000 and $24,000 outstanding balance in accounts payable under the agreement as of September 30, 2021 and December 31, 2020, respectively.
Units, generating gross proceeds of approximately $38.9 million, and incurring additional offering costs of approximately $2.1 million in underwriting fees (inclusive of approximately $1.4 million in deferred underwriting fees).
In connection with the consummation of the Over-Allotment on December 1, 2020, the underwriters were entitled to an additional fee of approximately $779,000 paid upon closing, and approximately $1.4 million in deferred underwriting commissions.
If the option to purchase additional Units is exercised in full, the underwriters will be entitled to an aggregate of $975,000 in fees payable upon closing and additional deferred underwriting commissions of approximately $1.7 million.
Class A Ordinary Shares7 — Derivative Warrant Liabilities
H.I.G. ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Class B Ordinary Shares— As of September 30, 2020, the Company was authorized to issue 40,000,000 Class B ordinary shares with a par value of $0.0001 per share. Upon adopting its amended and restated memorandum and articles of understanding, the Company became authorized to issue 95,000,000 Class B ordinary shares with a par value of $0.0001 per share. On September 3, 2020, the Company issued 19,406,250 Class B ordinary shares to the Sponsor. On September 28, 2020, the Sponsor effected a surrender of 6,468,750 Class B ordinary shares to the Company for no consideration. On October 15, 2020, the Sponsor effected a surrender of 3,593,750 Class B ordinary shares to the Company for no consideration, resulting in a decrease in the total number of Class B ordinary shares outstanding to 9,343,750 shares. All shares and associated per share amounts have been retroactively restated to reflect the share surrenders. Of the 9,343,750 shares outstanding, up to 1,218,750 shares are subject to forfeiture to the extent that the underwriters’ over-allotment option is not exercised in full or in part, so that the holders of our Founder Shares prior to the Initial Public Offering will collectively own approximately 20.0% of the Company’s issued and outstanding ordinary shares. On December 1, 2020, the underwriters purchased an additional 3,894,500 Over-Allotment Units upon partially exercising the over-allotment option; thus, an aggregate of 245,125 Class B ordinary shares remain subject to forfeiture.
Ordinary shareholders of record are entitled to one vote for each share held on all matters to be voted on by shareholders. Except as described below, holders of Class A ordinary shares and holders of Class B ordinary shares will vote together as a single class on all matters submitted to a vote of our shareholders except as required by law. The Class B ordinary shares will automatically convert into Class A ordinary shares, provided, however, that such Class A ordinary shares delivered upon conversion will not have any redemption rights or be entitled to liquidating distributions if the Company does not consummate an initial Business Combination, at the time of the initial Business Combination or earlier at the option of the holders thereof at a ratio such that the number of Class A ordinary shares issuable upon conversion of all Founder Shares will equal, in the aggregate, on an as-converted basis, 20% of the sum of (i) the total number of ordinary shares issued and outstanding upon completion of the Initial Public Offering, plus (ii) the total number of Class A ordinary shares issued or deemed issued or issuable upon conversion or exercise of any equity-linked securities or rights issued or deemed issued, by the Company in connection with or in relation to the consummation of the initial Business Combination, excluding any Class A ordinary shares or equity-linked securities exercisable for or convertible into Class A ordinary shares issued, deemed issued, or to be issued, to any seller in the initial Business Combination and any private placement warrants issued to the Sponsor, its affiliates or any member of the management team upon conversion of Working Capital Loans. In no event will the Class B ordinary shares convert into Class A ordinary shares at a rate of less than one-to-one.
Preference Shares—The Company is authorized to issue 1,000,000 preference shares 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, there were no preference shares issued or outstanding.
Warrants—Public Warrants may only be exercised for a whole number of shares. The Public Warrants will become exercisable on 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 covering the Class A ordinary shares 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
H.I.G. ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
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H.I.G. ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Description | Quoted Prices in Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Other Unobservable Inputs (Level 3) | |||||||||
Assets: | ||||||||||||
Investments held in Trust Account | $ | 363,978,513 | $ | — | $ | — | ||||||
Liabilities: | ||||||||||||
Derivative warrant liabilities - Public | $ | 8,658,014 | $ | — | $ | — | ||||||
Derivative warrant liabilities - Private | $ | — | $ | 3,915,073 | $ | — |
Description | Quoted Prices in Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Other Unobservable Inputs (Level 3) | |||||||||
Assets: | ||||||||||||
Investments held in Trust Account | $ | 363,951,287 | $ | — | $ | — | ||||||
Liabilities: | ||||||||||||
Derivative warrant liabilities - Public | $ | 15,892,270 | $ | — | $ | — | ||||||
Derivative warrant liabilities - Private | $ | — | $ | 8,103,570 | $ | — |
Contents
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations. |
The registration statement for our initial public offering (the “Initialthe Initial Public Offering”) becameOffering was declared effective on October 20, 2020. On October 23, 2020, weWe consummated the Initial Public Offering of 32,500,000 units (the “Units” and, with respect to the) on October 23, 2020. Each Unit consisted of one Class A ordinary shares included inshare and
Liquidityexpenses, $30,000 in administrative expenses – related party, approximately $8.3 million change in the fair value of derivative warrant liabilities, and Capital Resources
As ofapproximately $9,000 in net gain from investments held in Trust Account.
Our liquidity needs to date have been satisfied through a contribution$9.2 million, which consisted of $25,000approximately $2.2 million in general and administrative expenses, $90,000 in administrative expenses – related party, offset by approximately $11.4 million in change in fair value of derivative warrant liabilities, and approximately $27,000 in net gain from our Sponsor to cover certain of our expensesinvestments held in exchange for the issuance of the issuanceTrust Account.
Based on the foregoing, management believes that the Company will have sufficient working capital and borrowing capacity 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 heldpresented at redemption value as temporary equity, outside of the Trust Account for paying existing accounts payable, identifyingshareholders’ equity section of our condensed balance sheets. The Company recognizes changes in redemption value immediately as they occur and evaluating prospective initial Business Combination candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selectingadjusts the target businesscarrying value of redemption ordinary shares to mergeequal the redemption value at the end of each reporting period.
Contractual Obligations
We do not have any long-term debt obligations, capital lease obligations, operating lease obligations, purchase obligations or long-term liabilities, other thancalculation of diluted loss per share, since the note payable to our sponsorexercise of the warrants are contingent upon the occurrence of future events and the agreementinclusion of such warrants would be anti-dilutive.
Critical Accounting Policies
This management’s discussion and analysis of ourimpact, if any,
financial statements. On an ongoing basis, we evaluate our estimates and judgments, including those related to fair value of financial instruments and accrued expenses. We base our estimates on historical experience, known trends and events and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. There have been no significant changes in our critical accounting policies as discussed in the Form 8-K and the final prospectus filed by us with the SEC on October 29, 2020 and October 22, 2020, respectively.
Recent Accounting Pronouncements
cash flows.
Item 3. | Quantitative and Qualitative Disclosures About Market Risk |
Item 4. Controls As of September 30, 2021, we were not subject to any market or interest rate risk. The net proceeds of the Initial Public Offering, including amounts in the Trust Account, will be invested in investments in mutual funds invested in government securities with a maturity of 185 days or less or in that meet certain conditions under Rule
we do not expect to engage in any hedging activities with respect to the market risk to which we are exposed.
Item 4. | Controls and Procedures |
Under the supervision and with the participation of our management, including our principal executive officer and principal financial and accounting officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures as of the end of the fiscal quarter ended September 30, 2020, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on this evaluation, our chief executive officer and chief financial officer have concluded that during the period covered by this report, our disclosure controls and procedures were effective.
Changes
There was no changeRules
Item 1. | Legal Proceedings |
Item 1A. | Risk Factors |
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds from Registered Securities
Unregistered Sales
On September 3, 2020, our Sponsor paid $25,000 to cover certain of our expenses in exchange for issuance of 19,406,250 Class B ordinary shares, par value $0.0001, (the “Founder Shares”). On September 28, 2020, our Sponsor effected a surrender of 6,468,750 Founder Shares to the Company for no consideration. On October 15, 2020, our Sponsor effected a surrender of 3,593,750 Founder Shares to the Company for no consideration, resulting in a decrease in the total number of Class B ordinary shares outstanding to 9,343,750 shares. Our Sponsor agreed to forfeit up to 1,218,750 Founder Shares to the extent that the underwriters’ 45-day over-allotment option is not exercised in full by the underwriters, so that the Founder Shares will represent 20.0% of the Company’s issued and outstanding shares after the Initial Public Offering. Our Sponsor transferred to four independent directors of the Company an aggregate of 35,000 Founder Shares each, for a total of 140,000 shares, in September 2020. These 140,000 Founder Shares shall not be subject to forfeiture in the event the underwriters’ overallotment option is not exercised. On December 1, 2020, the underwriters purchased an additional 3,894,500 Over-Allotment Units upon partially exercising the over-allotment option; thus, an aggregate of 245,125 Class B ordinary shares remain subject to forfeiture. Such securities were issued in connectionMarch 30, 2021, Form
On October 23, 2020, our Sponsor purchased 5,666,667 Private Placement Warrants, each exercisable to purchase one Class Form
No underwriting discounts or commissions were paid with respect to such sales.
Use of Proceeds
On October 23, 2020, we consummated the Initial Public Offering of 32,500,000 units (the “Units” and, with respect to the Class A ordinary shares included in the Units, the “Public Shares”), at $10.00 per Unit, generating gross proceeds of $325.0 million. The underwriter was granted a 45-day option from the date of the final prospectus relating to the Initial Public Offering to purchase up to 4,875,000 additional Units to cover over-allotments, if any, at $10.00 per Unit. On November 25, 2020, the underwriters partially exercised the over-allotment option and on December 1, 2020, purchased an additional 3,894,500 Over-Allotment Units, generating gross proceeds of approximately $38.9 million.
In connection with the Initial Public Offering and the Over-Allotment, we incurred offering costs of approximately $20.7 million, inclusive of approximately $12.7 million in deferred underwriting commissions. Other incurred offering costs consisted principally of preparation fees related to 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, $363.9 million of the net proceeds from our Initial Public Offering, the Over-Allotment and certain of the proceeds from the private placement of the Private Placement Warrants (or $10.00 per Unit sold in the Initial Public Offering) was 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 on Form 10-Q. See Note 3 to the unaudited condensed financial statements.
There 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 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. |
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Dated: December 29, 2021 | H.I.G. ACQUISITION CORP. | |||||||
By: | /s/ | |||||||
Name: | ||||||||
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Timur Akazhanov | ||||||||
Title: | Chief Financial Officer
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