| | • | | limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate; |
| | • | | increased vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation; |
| | • | | limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, and execution of our strategy; and |
| | • | | other purposes and other disadvantages compared to our competitors who have less debt. |
We expect to incur significant costs in the pursuit of our business combination plans. We cannot assure you that our plans to raise capital or to complete our Initial Business Combination will be successful.
Recent Developments
On August 8, 2018, we, and Altus Midstream LP, a Delaware limited partnership and our wholly owned subsidiary (“Altus Midstream”), entered into a Contribution Agreement (the “Contribution Agreement” and the business combination contemplated thereby, the “Altus Business Combination”) with Apache Midstream LLC, a Delaware limited liability company (the “Apache Contributor”) and wholly owned subsidiary of Apache Corporation, a Delaware corporation (“Apache”), Alpine High Gathering LP, a Delaware limited partnership (“Alpine High Gathering”), Alpine High Pipeline LP, a Delaware limited partnership (“Alpine High Pipeline”), Alpine High Processing LP, a Delaware limited partnership (“Alpine High Processing”), Alpine High NGL Pipeline LP, a Delaware limited partnership (“Alpine High NGL”), and Alpine High Subsidiary GP LLC, a Delaware limited liability company (“Alpine High GP” and, together with Alpine High Gathering, Alpine High Pipeline, Alpine High Processing and Alpine High NGL, the “Alpine High Entities”), pursuant to which Altus Midstream and/or its subsidiaries will acquire from the Apache Contributor: (i) 100% of the equity interests in each of the Alpine High Entities and (ii) options, currently held by the Apache Contributor, to acquire equity interests in certain third-party pipelines that are expected to be placed into service in 2019 and 2020, which include (A) an option to acquire up to a 15% equity interest (as well as pursuant to a supplemental option, an additional 1% equity interest) in the Gulf Coast Express pipeline, (B) an option to acquire up to a 15% equity interest in the EPIC Crude pipeline, (C) an option to acquire a 50% equity interest in the Salt Creek NGL pipeline, and (D) an option to acquire up to a 33% equity interest in the Shin Oak pipeline (collectively, the “Options”).
On November 6, 2018, the Company held a special meeting in lieu of its 2018 annual meeting of stockholders to consider, among other things, a proposal to approve and adopt the Contribution Agreement and the Altus Business Combination. At the special meeting, holders of a majority of the outstanding shares of Class A Common Stock and Class B Common Stock entitled to vote and cast on such proposal approved and adopted the Contribution Agreement and the Altus Business Combination. The number of shares of the Company’s Class A Common Stock presented for redemption in connection with the special meeting and the Altus Business Combination was 29,469,858.
Please refer to Note 7 and Note 8 to the Financial Statements above or to the Company’s Definitive Proxy Statement on Schedule 14A filed with the SEC on October 22, 2018 and the Company’s Current Reports on Form8-K filed on August 8, 2018 and November 6, 2018 for additional information.
Results of Operations and Known Trends or Future Events
We have neither engaged in any operations nor generated any operating revenue to date. Our only activities since inception relate to our formation, the Public Offering which was consummated on April 4, 2017 and efforts directed toward locating a suitable Initial Business Combination. We will not generate any operating revenue until after completion of an Initial Business Combination, at the earliest. Prior to such time, we will generatenon-operating income in form of interest income on cash and cash equivalents. We incur increased expenses as a result of being a public company (for legal, financial reporting and auditing compliance), as well as expenses as we conduct due diligence on prospective business combination candidates.
For the three and nine months ended September 30, 2018, we had a net income (loss) of ($953,653) and $343,900, respectively, which consisted primarily of investment income from the Trust Account of $1,712,170 and $4,362,433, respectively. This income was partially offset by general and administrative expenses of $2,266,757 and $2,981,085, respectively, franchise tax expense of $50,013 and $150,038, respectively and income tax expense of $349,053 and $887,410, respectively.
For the three and nine months ended September 30, 2017, we had a net income (loss) of $220,657 and ($512,613), respectively, which consisted primarily of investment income from the Trust Account of $809,858 and $1,353,883, respectively. This income was partially offset by general and administrative expenses of $276,956 and $1,340,902, respectively, franchise tax expense of $55,900 and $98,900, respectively and income tax expense of $256,345 and $426,694, respectively.
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