Item 1. Business
ITEM 1.
BUSINESS
Introduction
We are a blank check company
incorporated as a Cayman Islands exempted company and formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to
throughout this Report as our initial business combination.
Vector Capital
Vector Capital is a San Francisco-based private equity firm focused on special situations investments in technology and technology enabled
businesses in the middle-market. Founded in 1997, Vector currently oversees $3.5 billion in capital across its private equity and credit strategies and has invested $3.5 billion in more than 50 technology companies since its
inception. Throughout its 24 year history, Vector has exclusively focused on investments within the technology sector and has built a successful track record of executing public buyouts, acquisitions of private and venture-backed companies,
corporate spin-outs and divestitures, credit recapitalizations and restructurings, minority investments in bootstrapped companies, and private investments in public equity. Within technology, Vector invests across a variety of sectors,
including Vertical Applications, Horizontal Applications, Data Analytics, Cloud & IT Infrastructure Solutions, IT Security, Mobile Technologies, IP Licensing, Data & Information Services, Data Communications Solutions, Digital
Media & Internet, and Industrial Tech & Internet of Things, among others. Vectors disciplined approach to valuation and flexible approach to investment structure is intended to deliver superior risk adjusted returns.
Vector Capitals principals include Mr. Alex Slusky, Vectors Founder, Managing Director, and Chief Investment Officer;
Mr. David Fishman, Managing Director and Head of Vectors Investment Team; and Mr. David Baylor, Managing Director and Chief Operating Officer. Mr. Slusky, Mr. Fishman, and Mr. Baylor are supported by more than 30
investing and operating professionals including a dedicated sourcing team, a highly experienced investment team, and a value creation team with over 300 years of collective experience within the technology sector. We believe that Vector
Capitals technology expertise serves as a significant competitive advantage over generalist private equity funds when sourcing investment opportunities, conducting due diligence, adding value post-acquisition, and exiting investments.
Vector Acquisition Corporation will leverage the full capabilities of the Vector platform and have comprehensive access to its team, deal
prospects, and network, along with any necessary resources to aid in the identification, diligence, and operational support of a target for the initial business combination.
Our Management Team
Our management team
is led by Mr. Alex Slusky, Vectors Founder, Managing Director, and Chief Investment Officer, Mr. David Fishman, Managing Director and Head of Vectors Investment Team, and Mr. David Baylor, Managing Director and Chief
Operating Officer. Collectively, they have more than 90 years of operational, financial, investment, and transactional experience, primarily within the technology sector. Our management team is supported by Mr. John Herr and Mr. David
Kennedy, who serves as our directors along with Mr. Slusky.
Mr. Slusky founded Vector Capital in 1997 and has more than
25 years of investing and operating experience in technology companies. He is our Chief Executive Officer and Chairman and holds the same positions with Vector Acquisition Corporation II (Nasdaq: VAQC) (Vector II), Vector
Acquisition Corporation III (Vector III) and Vector Acquisition Corporation IV (Vector IV and, collectively with Vector II, Vector III and any future special purpose acquisition company sponsored by an affiliate of Vector,
the Vector SPACs).
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Mr. Slusky has deep technical experience in both private and public technology companies and has successfully invested across multiple market cycles including the 1998 2000
Internet bubble and the 2008 2009 financial crisis. Prior to founding Vector Capital, Mr. Slusky led the technology equity practice at Ziff Brothers Investments, managing a portfolio of public and private technology investments
which later became Vector Capital I. Prior to Ziff, Mr. Slusky spent three years at New Enterprise Associates (NEA), where he focused on venture investments in software, communications, and digital media. Mr. Slusky began his career
at Microsoft and McKinsey & Company.
Mr. Fishman joined Vector Capital in 2006 and has more than 20 years of investing
and transactional experience in technology companies. He is our President and holds the same position with Vector II, Vector III and Vector IV. Prior to joining Vector, Mr. Fishman spent ten years at Goldman, Sachs & Co. where he
was a Managing Director in the Mergers and Acquisitions division and focused on technology and media transactions. Mr. Fishman has extensive transaction expertise, having consummated approximately 30 mergers and acquisitions during his tenure
at Goldman, worth an aggregate value of $110 billion, including transactions involving Microsoft, eBay, Adobe, IBM, Oracle, and PeopleSoft.
Mr. Baylor joined Vector Capital in 2008 and has more than 30 years of operating experience, including as a senior executive at a
publicly traded company. He is our Chief Financial Officer and holds the same position with Vector II, Vector III and Vector IV. Prior to joining Vector, Mr. Baylor was the Chief Operating Officer and Chief Financial Officer at Thomas Weisel
Partners where he was a member of the Executive Committee. Prior to Thomas Weisel Partners, Mr. Baylor was a Managing Director with Montgomery Securities, a securities attorney with Howard, Rice, Nemerovski, Canady, Falk & Rabkin, and
a certified public accountant with Deloitte & Touche.
Mr. Slusky and Mr. Fishman, who have worked together for
14 years and constitute Vector Capitals Investment Committee, have spent their entire careers evaluating and investing in technology businesses and have a deep understanding of trends, market cycles, vertical expertise, and the proven
ability to identify, diligence, structure, and transform technology investments.
Mr. Herr is a seasoned technology executive with
more than 25 years of experience in the cloud, consumer internet, e-commerce, new media, and financial services sectors, and has an exceptional track record of scaling technology businesses into large
enterprises. Mr. Herr previously served as Chief Executive Officer of Avetta for four years and under his leadership, the company experienced significant revenue growth and transformed from break-even to highly profitable. Prior to Avetta,
Mr. Herr served as CEO of Adaptive Insights, where he was responsible for meaningful revenue growth during his four-year tenure. Adaptive was ultimately sold to Workday for over $1.5 billion. Mr. Herr has also held executive roles at
EZ Shield, eBay, PayPal, and Buy.com. He currently serves on the Board of Directors of Planful, a Vector Capital portfolio company, and WineAccess.com, as well as Vector II.
Mr. Kennedy is the co-founder and a Partner at Serent Capital, a San Francisco-based lower-middle
market private equity firm focused on service and technology businesses. During his 12-year tenure at Serent Capital, Mr. Kennedy has built a successful track record investing in high growth technology
companies. Prior to co-founding Serent Capital in 2008, Mr. Kennedy was President and Chairman of ServiceSource (NASDAQ: SREV), a Business Process Outsourcing software company that served many of the
worlds leading technology companies. Under Mr. Kennedys leadership, ServiceSource grew revenues, profits, and employees and oversaw strong shareholder returns. Previously, David was a consultant at McKinsey & Company in
London, Dublin, and San Francisco, and an Operations Manager at HJ Heinz in Central & Eastern Europe. Mr. Kennedy also serves on the Board of Directors of Vector II.
Our management team is supported by Vector Capitals entire team of sourcing, investment, and operating professionals, all of whom had
meaningful experience investing in, advising, or working at technology companies before joining Vector. Vector Capitals core team has been investing together in the technology sector
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for over a decade and has collectively built a network of relationships that we believe will be invaluable for providing us with a substantial number of attractive business targets.
With respect to the above, past experience or performance of our management team and their respective affiliates is not a guarantee of either
(i) our ability to successfully identify and execute a transaction or (ii) success with respect to any business combination that we may consummate. You should not rely on the historical record of our management team or their respective
affiliates as indicative of future performance. Our management team and their respective affiliates have been involved with a large number of public and private companies in addition to those identified above, not all of which have achieved similar
performance levels. For a complete list of our executive officers and entities for which a conflict of interest may or does exist between such officers and the company, please see Item 10 Directors, Executive Officers and
Corporate Governance Conflicts of Interest.
Proposed Business Combination
Merger Agreement
On March 1, 2021,
we entered into an Agreement and Plan of Merger (as the same may be amended, supplemented or otherwise modified from time to time, the Merger Agreement), with Rocket Lab USA, Inc., a Delaware corporation (Rocket Lab), and
Prestige USA Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Rocket Lab (Merger Sub). The Merger Agreement and the transactions contemplated thereby were unanimously approved by our board of directors and by the
boards of directors of Rocket Lab.
The Merger Agreement contemplates that our business combination with Rocket Lab and Merger Sub will be
completed through the following series of transactions:
we will domesticate as a Delaware corporation (the Domestication and the company following the
Domestication, Delaware Vector) and, in connection therewith, (a) our Class A ordinary shares and our Class B ordinary shares issued and outstanding immediately prior to the Domestication will convert into an equal number
of shares of common stock, par value $0.0001 per share, of Vector Delaware (the Delaware Vector Common Stock); (b) our warrants to purchase Class A ordinary shares issued and outstanding immediately prior to the Domestication will
convert into an equal number of warrants to purchase Delaware Vector Common Stock (the Delaware Vector Warrants) and (c) our units that have not been separated into Class A ordinary shares and warrants issued and outstanding
immediately prior to the Domestication will convert into an equal number of units of Delaware Vector (the Delaware Vector Units);
concurrently with the Domestication, Rocket Lab will amend and restate its certificate of incorporation (the
Charter Amendment), and in connection therewith, (a) each issued and outstanding share of preferred stock, par value $0.0001 per share, of Rocket Lab will convert into shares of common stock, par value $0.0001 per share, of Rocket
Lab (the Rocket Lab Common Stock), in accordance with the terms thereof; (b) each issued and outstanding share of Rocket Lab Common Stock (after giving effect to the conversion contemplated by clause (a)) will convert automatically
into a number of shares of Rocket Lab Common Stock equal to the Exchange Ratio (as defined below); (c) each then issued and outstanding warrant of Rocket Lab will convert into a new warrant of Rocket Lab (a New Rocket Lab Warrant) for a
number of shares of Rocket Lab Common Stock and with the applicable exercise price per share determined in accordance with the Merger Agreement; (d) each then issued and outstanding option to purchase Rocket Lab Common Stock will convert into a
new option for a number of shares of Rocket Lab Common Stock (a New Rocket Lab Option) and with the applicable exercise price per share determined in accordance with the Merger Agreement; and (e) each award of Rocket Labs
restricted stock units will convert into an award of restricted stock units with respect to a number of shares of Rocket Lab Common Stock (the New Rocket Lab Restricted Stock Units) determined in accordance with the Merger Agreement;
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immediately following the Domestication, Merger Sub will merge with and into Delaware Vector, with Delaware
Vector surviving the merger as a wholly owned subsidiary of Rocket Lab (the First Merger), and in connection therewith, (a) the shares of Delaware Vector Common Stock (other than any treasury shares, shares held by Delaware Vector
or any dissenting shares) issued and outstanding immediately prior to the effective time of the First Merger (the First Effective Time) will convert into an equal number of shares of Rocket Lab Common Stock; (b) the Delaware Vector
Warrants that are outstanding and unexercised immediately prior to the First Effective Time will convert into an equal number of warrants to purchase Rocket Lab Common Stock (the Assumed Warrants) and (c) the Delaware Vector Units
that are outstanding immediately prior to the First Effective Time will convert into an equal number of units of Rocket Lab (the Assumed Units); and
immediately following the First Effective Time, Rocket Lab will merge with and into Delaware Vector, with
Delaware Vector surviving the merger (Delaware Vector as the surviving corporation, PublicCo and such merger, the Second Merger and, together with the First Merger, the Mergers).
In connection with the Second Merger:
the shares of Rocket Lab Common Stock (other than any treasury shares, shares held by Rocket Lab or dissenting
shares) issued and outstanding immediately prior to the effective time of the Second Merger (the Second Effective Time) will convert into an equal number of shares of common stock, par value $0.0001 per share, of PublicCo (the
PublicCo Common Stock);
the New Rocket Lab Warrants and the Assumed Warrants outstanding and unexercised immediately prior to the Second
Effective Time will convert into an equal number of warrants to purchase PublicCo Common Stock;
each New Rocket Lab Option that is outstanding and unexercised immediately prior to the Second Effective Time
(whether vested or unvested) will automatically be assumed by PublicCo and will generally be subject to the same terms and conditions as were applicable to such New Rocket Lab Option immediately prior to the Second Effective Time;
each New Rocket Lab Restricted Stock Unit that is outstanding and unvested immediately prior to the Second
Effective Time will automatically be assumed by PublicCo and converted into an award of time-vesting restricted stock units with respect to a number of shares of PublicCo Common Stock equal to the number of New Rocket Lab Restricted Stock Units
subject to such award and will generally be subject to the same terms and conditions as were applicable to such New Rocket Lab Restricted Stock Unit immediately prior to the Second Effective Time; and
each Assumed Unit that is outstanding immediately prior to the Second Effective Time will automatically be
converted into a unit of PublicCo.
In addition to the above, if the closing price of PublicCo Common Stock is equal to
or greater than $20.00 for a period of at least 20 days out of 30 consecutive trading days during the period commencing on the 90th day following the closing of the Business Combination (the Closing) and ending on the 180th day following
the Closing, the Rocket Lab stockholders will be entitled to receive additional shares of PublicCo Common Stock equal to 8% of the Aggregate Share Consideration (as defined below).
For purposes of the Merger Agreement, the Exchange Ratio equals the quotient obtained by dividing (i) the Aggregate Share
Consideration by (ii) the aggregate number of shares of Rocket Lab Common Stock outstanding immediately prior to the Charter Amendment on a fully diluted basis (other than the Management Redemption Shares). The Aggregate Share
Consideration means the quotient obtained by dividing (i) an amount equal to $4,000,000,000 minus the Management Redemption Amount (as defined below) by (ii) (x) an amount equal to $10.00 plus (y) an amount equal to (a) the
interest earned on funds held in Vectors trust account divided by (b) the number of Class A ordinary shares outstanding immediately prior to the Closing.
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The Domestication, the Mergers and the other transactions contemplated by the Merger
Agreement are hereinafter referred to as the Business Combination. The Business Combination is expected to close in the second quarter of 2021, subject to the satisfaction of certain customary closing conditions.
The Merger Agreement also provides that:
Immediately prior to the Closing, Rocket Lab will enter into redemption agreements with certain members of Rocket
Lab management pursuant to which Rocket Lab will redeem from such individuals shares of Rocket Lab Common Stock (the Management Redemption Shares) for an aggregate purchase price not to exceed $40,000,000 (the purchase price for any
redemptions, the Management Redemption Amount).
The parties have agreed to take all action within their power as may be necessary or appropriate such that,
effective immediately after the Closing, the board of directors of Delaware Vector will consist of six directors, including five current directors of Rocket Lab and one designee of the company, who will be Alex Slusky.
We will be providing the holders of Class A ordinary shares the right to redeem all or a portion of their
Class A ordinary shares in connection with the Business Combination, as set forth in our governing documents.
The
obligation of the company, Rocket Lab and Merger Sub to consummate the Business Combination is subject to certain closing conditions, including, but not limited to, (i) the expiration or termination of the applicable waiting period under the
HSR Act, (ii) the approval of the companys shareholders, (iii) the approval of Rocket Labs stockholders, and (iii) the Registration Statement on Form S-4 relating to the Mergers
becoming effective. In addition, our obligation to consummate the Business Combination is subject to the fulfillment of other closing conditions, including, but not limited to, (i) the representations and warranties of Rocket Lab and Merger Sub
being true and correct to the standards applicable to such representations and warranties and each of the covenants of Rocket Lab and Merger Sub having been performed or complied with in all material respects and (ii) no Company Material
Adverse Effect (as defined in the Agreement) having occurred. The obligation of Rocket Lab to consummate the Business Combination is also subject to the fulfillment of other closing conditions, including, but not limited to, (i) the
representations and warranties of the company being true and correct to the standards applicable to such representations and warranties and each of the covenants of the company having been performed or complied with in all material respects and
(iii) the aggregate cash proceeds from our trust account, together with the proceeds from the PIPE Financing (as defined below), equaling no less than $500,000,000 (after deducting any amounts paid to our shareholders that exercise their
redemption rights in connection with the Business Combination but before the payment of any transaction costs of the company and Rocket Labs).
The Merger Agreement may be terminated under certain customary and limited circumstances prior to the Closing (i) by mutual written
consent of the company and Rocket Lab; (ii) by the company if the representations and warranties of Rocket Lab and Merger Sub are not true and correct or if Rocket Lab or Merger Sub fails to perform any covenant or agreement set forth in the
Merger Agreement such that certain conditions to Closing cannot be satisfied and the breach or breaches of such representations or warranties or the failure to perform such covenant or agreement, as applicable, are not cured or cannot be cured
within certain specified time periods; (iii) by Rocket Lab if the representations and warranties of the company are not true and correct or if the company fails to perform any covenant or agreement set forth in the Merger Agreement such that
certain conditions to Closing cannot be satisfied and the breach or breaches of such representations or warranties or the failure to perform such covenant or agreement, as applicable, are not cured or cannot be cured within certain specified time
periods; (iv) subject to certain limited exceptions, by either the company or Rocket Lab if the Business Combination is not consummated by November 30, 2021; (v) by either the company or Rocket Lab if the approval by our shareholders of
the Business Combination shall not have been obtained and (vi) by either the company or Rocket Lab if the approval by Rocket Labs stockholders of the Business Combination shall not have been obtained.
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Lock-up Arrangements
In connection with the Closing, certain Rocket Lab stockholders who enter into a Support Agreement (as defined below), will enter into a
lockup agreement with PublicCo pursuant to which they will agree not to transfer, sell or assign their shares of PublicCo Common Stock for six months following the Closing. In addition, Vector Acquisition Partners, L.P., our sponsor, has agreed not
to transfer, sell or assign its shares of PublicCo Common Stock received in connection with the Business Combination until the earliest of (a) one year after the Closing and (b) subsequent to Closing, (i) if the closing price of the
PublicCo Common Stock equals or exceeds $12.00 per share (as adjusted for share subdivisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any
30-trading day period commencing at least 150 days after Closing, or (y) the date on which PublicCo completes a liquidation, merger, share exchange or other similar transaction that results in all of
its public stockholders having the right to exchange their common stock for cash, securities or other property.
PIPE Financing
Concurrently with the execution of the Merger Agreement, we entered into subscription agreements (the Subscription Agreements)
with certain investors (the PIPE Investors), pursuant to which the PIPE Investors agreed to subscribe for and purchase, and we agreed to issue and sell to such PIPE Investors, immediately prior to Closing, an aggregate of 46,700,000
shares of PublicCo Common Stock for a purchase price of $10.00 per share, for aggregate gross proceeds of $467,000,000 (the PIPE Financing).
The closing of the PIPE Financing is contingent upon, among other things, the substantially concurrent consummation of the Business
Combination. The Subscription Agreements provide that we will grant the investors in the PIPE Financing certain customary registration rights.
Sponsor
Letter Agreement
Concurrently with the execution of the Merger Agreement, we entered into a letter agreement (the Sponsor
Letter Agreement) with our sponsor, pursuant to which our sponsor agreed to, among other things, (i) vote at any meeting of our shareholders, and in any action by written resolution of our shareholders, all of its Class B ordinary
shares or Delaware Vector Common Stock, as applicable, in favor of the Business Combination and the other proposals to be voted upon at our shareholder meeting; (ii) be bound by certain other covenants and agreements related to the Business
Combination and (iii) waive the anti-dilution protection with respect to the Class B ordinary shares, in each case, on the terms and subject to the conditions set forth in Sponsor Letter Agreement.
Support Agreements
Concurrently with the
execution of the Merger Agreement, certain stockholders of Rocket Lab representing the requisite votes necessary to approve the Business Combination entered into support agreements (the S upport Agreements) with the company,
pursuant to which each such stockholder agreed to, among other things, (i) vote at any meeting of Rocket Labs stockholders, and in any action by written consent of Rocket Labs stockholders, all of its Rocket Lab equity securities in
favor of the adoption and approval of the Merger Agreement and the transactions contemplated thereby, including the Mergers; (ii) be bound by certain other covenants and agreements related to the Business Combination and (iii) be bound by
certain transfer restrictions with respect to such securities, in each case, on the terms and subject to the conditions set forth in the Support Agreements.
Business Strategy
We have an extensive
track record of successfully sourcing and executing special situations technology investments, including public buyouts, acquisitions of private and venture-backed companies, corporate spin-outs
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and divestitures, credit recapitalizations and restructurings, minority investments in bootstrapped companies, and private investments in public equity. Vector Capitals
sourcing, investment, and value creation professionals have spent years developing relationships with technology company founders, CEOs and other executives, venture capitalists, private equity investors, board members, intermediaries and other
industry leaders. We believe that Vector Capitals reputation and expertise as a technology specialist gives us greater credibility with sellers and management teams and provides us with an advantage during a transaction process.
We believe our sourcing capabilities, which are supported by our expansive network and deep and constantly growing relationships with
technology company founders, CEOs and other executives, venture capitalists, private equity investors, board members, intermediaries and other industry leaders are a competitive advantage. Our dedicated sourcing professionals are well qualified and
focused on developing proprietary investment opportunities. We evaluate the public markets using our proprietary screens, communicate with larger technology companies to uncover spin-out candidates, engage the
venture and private equity community to identify quality companies in older vintage funds, and most importantly, maintain substantive dialogues with entrepreneurs, board members, and executives of companies who may benefit from our capital and
expertise to navigate a transition or a difficult time in their business. In 2018 and 2019, we considered approximately 900 opportunities each year, of which more than 200 were of sufficient interest to review in closer detail each year.
Additionally, our established reputation for insightful analysis, ability to create value in complex situations, active involvement in value
creation initiatives, and being a knowledgeable partner, results in frequent inbound communication from founders, shareholders, management teams, and investment bankers seeking our advice and soliciting our interest in special situations investment
opportunities.
Vector has established a successful track record spanning 23 years and we have demonstrated our ability to identify,
evaluate, and execute special situations technology investments through volatile markets.
Acquisition Strategy
Consistent with our strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating
prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target business that does not meet these criteria and
guidelines. We intend to seek to acquire companies that we believe:
operate in an attractive industry;
have a defensible core business, sustainable revenues and established customer relationships;
have strong product capabilities that offer an attractive value proposition to customers;
have capable, talented management teams who are experts in their industries
can benefit from our expertise and value creation initiatives; and
have reached a point in their lifecycle where a change in the capital structure can facilitate additional
constructive growth through investments or acquisitions.
These criteria are not intended to be exhaustive. Any
evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management and our board may deem
relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our
shareholder communications related to our initial business combination, which, as discussed in the final prospectus relating to our initial public offering, would be in the form of tender offer documents or proxy solicitation materials that we would
file with the U.S. Securities and Exchange Commission (the SEC).
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Market Opportunity
We intend to identify and acquire a business within the technology and technology-enabled services sectors with an overall transaction value
between $900 million and $3.0 billion. We believe that these sectors represent attractive target markets given the size, breadth and prospects for growth, with global information technology spending expected to be $3.9 trillion in 2020 and
expected to continue to grow in the future. We believe that this large, ecosystem creates a compelling opportunity for us to identify, build relationships with, and create opportunities to complete an initial business combination with very
attractive companies. Additionally, we believe that technology has become, and will continue to be, a core component of every economic sector. As technology continues to propagate across different functional departments within an organization, the
need for additional technology solutions will increase, expanding the addressable market for technology companies.
Initial Business Combination
So long as our securities are then listed on the Nasdaq, our initial business combination must occur with one or more target
businesses that together have an aggregate fair market value of at least 80% of the net assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of
signing a definitive agreement in connection with our initial business combination. If our board is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent
investment banking firm or an independent valuation or appraisal firm with respect to the satisfaction of such criteria. While we consider it unlikely that our board will not be able to make an independent determination of the fair market value of a
target business or businesses, it may be unable to do so if the board is less familiar or experienced with the target companys business, there is a significant amount of uncertainty as to the value of the companys assets or prospects,
including if such company is at an early stage of development, operations or growth, or if the anticipated transaction involves a complex financial analysis or other specialized skills and the board determines that outside expertise would be helpful
or necessary in conducting such analysis. Since any opinion, if obtained, would merely state that the fair market value of the target business meets the 80% of net assets threshold, unless such opinion includes material information regarding the
valuation of a target business or the consideration to be provided, it is not anticipated that copies of such opinion would be distributed to our shareholders. However, if required under applicable law, any proxy statement that we deliver to
shareholders and file with the SEC in connection with a proposed transaction will include such opinion.
We anticipate structuring our
initial business combination so that the post-business combination company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our
initial business combination such that the post-business combination company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for
other reasons, but we will only complete such 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 of 1940, as amended, or the Investment Company Act. Even if the post- business combination company owns or acquires 50% or more of the voting
securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post- business combination company, depending on valuations ascribed to the target and us in the business combination. For
example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a
result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less
than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post- business combination company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes
of the 80% of net assets test. If the business combination involves more than one target
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business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as the initial business combination for
purposes of a tender offer or for seeking stockholder approval, as applicable.
To the extent we effect our initial business combination
with a company or business that may be financially unstable or in its early stages of development or growth, we may be affected by numerous risks inherent in such company or business. Although our management will endeavor to evaluate the risks
inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant risk factors.
The time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs
associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target business with which our initial business combination is not
ultimately completed will result in our incurring losses and will reduce the funds we can use to complete another business combination.
Our
Acquisition Process
In evaluating a prospective target business, we conduct a thorough due diligence review that encompasses, among
other things, meetings with incumbent management and employees, document reviews, inspection of facilities, as well as a review of financial, operational, legal and other information that will be made available to us. We also utilize our operational
and capital planning experience.
We are not prohibited from pursuing an initial business combination with a company that is affiliated
with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion
from an independent investment banking firm or another independent entity that commonly renders valuation opinions that such initial business combination is fair to our company from a financial point of view. We are not required to obtain such an
opinion in any other context.
Members of our management team and our independent directors directly or indirectly own founder shares
and/or private placement warrants and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our
officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement
with respect to our initial business combination.
All of the members of our management team are employed by certain affiliates of Vector
Capital. Vector Capital is continuously made aware of potential business opportunities, one or more of which we may desire to pursue for a business combination. We will not consider a business combination with any company that has already been
identified to Vector Capital as an acquisition candidate for it.
Each of our officers and directors presently has, and any of them in the
future may have additional, fiduciary or contractual obligations to other entities, including without limitation the Vector SPACs and any future special purpose acquisition companies we expect they may be involved in, pursuant to which such officer
or director is or will be required to present a business combination opportunity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity that is suitable for an entity to which he or she has then-current
fiduciary or contractual obligations (including, without limitation, any of the Vector SPACs), then, subject to their fiduciary duties under Cayman Islands law, he or she will need to honor his or her fiduciary or contractual obligations to present
such opportunity to such entity before we can pursue such opportunity. If these other entities decide to pursue any such opportunity, we may be precluded from pursuing the same. We do not believe, however, that the fiduciary duties or contractual
obligations of our officers or directors will materially affect our ability to complete our business combination. Our amended and restated memorandum and articles of
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association provide that we renounce our interest in any business combination opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in
his or her capacity as a director or officer of the company and it is an opportunity that we are able to complete on a reasonable basis.
In addition, our sponsor, officers and directors have formed, or become an officer or director, of other blank check companies, and may
continue to do so in the future prior to the completion of our initial business combination. As a result, our sponsor, officers or directors could have conflicts of interest in determining whether to present business combination opportunities to us
or to any other blank check company with which they may become involved. We do not currently expect that any such other blank check company would materially affect our ability to complete our initial business combination. In addition, our sponsor,
officers and directors, are not required to commit any specified amount of time to our affairs, and, accordingly, will have conflicts of interest in allocating management time among various business activities, including identifying potential
business combinations and monitoring the related due diligence.
Status as a Public Company
We believe our structure makes us an attractive business combination partner to target businesses. As an existing public company, we offer a
target business an alternative to the traditional initial public offering through a merger or other business combination with us. In a business combination transaction with us, the owners of the target business may, for example, exchange their
shares of stock in the target business for our Class A ordinary shares (or shares of a new holding company) or for a combination of our Class A ordinary shares and cash, allowing us to tailor the consideration to the specific needs of the
sellers. We believe target businesses will find this method a more expeditious and cost effective method to becoming a public company than the typical initial public offering. The typical initial public offering process takes a significantly longer
period of time than the typical business combination transaction process, and there are significant expenses in the initial public offering process, including underwriting discounts and commissions, that may not be present to the same extent in
connection with a business combination with us.
Furthermore, once a proposed business combination is completed, the target business will
have effectively become public, whereas an initial public offering is always subject to the underwriters ability to complete the offering, as well as general market conditions, which could delay or prevent the offering from occurring or have
negative valuation consequences. Once public, we believe the target business would then have greater access to capital, an additional means of providing management incentives consistent with shareholders interests and the ability to use its
shares as currency for acquisitions. Being a public company can offer further benefits by augmenting a companys profile among potential new customers and vendors and aid in attracting talented employees.
While we believe that our structure and our management teams backgrounds make us an attractive business partner, some potential target
businesses may view our status as a blank check company, such as our lack of an operating history and our ability to seek shareholder approval of any proposed initial business combination, negatively.
We are an emerging growth company, as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act. As such, we
are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply
with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved, If some investors find our securities less attractive as a result, there may be
a less active trading market for our securities and the prices of our securities may be more volatile.
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In addition, Section 107 of the JOBS Act also provides that an emerging growth
company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the
adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period.
We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth
anniversary of the completion of our initial public offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of
our Class A ordinary shares that are held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.
Additionally, we are a smaller reporting
company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only
two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates
equals or exceeds $250 million as of the prior June 30, and (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year or the market value of our ordinary shares held by non-affiliates equals or exceeds $700 million as of the prior June 30.
Financial Position
As of December 31, 2020, we had approximately $320,000,000 available to consummate an initial business combination after payment of the
estimated expenses of our initial public offering and $11,200,000 of deferred underwriting fees. With these funds available for a business combination, we offer a target business a variety of options such as creating a liquidity event for its
owners, providing capital for the potential growth and expansion of its operations or strengthening its balance sheet by reducing its debt ratio. Because we are able to complete our initial business combination using our cash, debt or equity
securities, or a combination of the foregoing, we have the flexibility to use the most efficient combination that will allow us to tailor the consideration to be paid to the target business to fit its needs and desires. However, we have not taken
any steps to secure third-party financing and there can be no assurance it will be available to us.
Effectuating Our Initial Business Combination
General
We are not
presently engaged in, and we will not engage in, any operations for an indefinite period of time following our initial public offering. We intend to effectuate our initial business combination using cash from the proceeds of our initial public
offering and the private placement of the private placement warrants, the proceeds of the sale of our shares in connection with our initial business combination (pursuant to forward purchase agreements or backstop agreements we may enter into
following the consummation of our initial public offering or otherwise), shares issued to the owners of the target, debt issued to bank or other lenders or the owners of the target, or a combination of the foregoing or other sources. We may seek to
complete our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, which would subject us to the numerous risks inherent in such companies and businesses.
If our initial business combination is paid for using equity or debt, or not all of the funds released from the trust account are used for
payment of the consideration in connection with our initial business combination or used for redemptions of our Class A ordinary shares, we may apply the balance of the cash released to us from the trust account for general corporate purposes,
including for maintenance or expansion of operations of the
post-business combination company, the payment of principal or interest due on indebtedness
incurred in completing our initial business combination, to fund the purchase of other companies or for working capital.
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We may need to obtain additional financing to complete our initial business combination,
either because the transaction requires more cash than is available from the proceeds held in our trust account, or because we become obligated to redeem a significant number of our public shares upon completion of the business combination, in which
case we may issue additional securities or incur debt in connection with such business combination. There are no prohibitions on our ability to issue securities or incur debt in connection with our initial business combination. Other than the
potential availability of the backstop arrangement with our sponsor, we are not currently a party to any arrangement or understanding with any third party with respect to raising any additional funds through the sale of securities, the incurrence of
debt or otherwise.
Although our management will assess the risks inherent in a particular target business with which we may combine, we
cannot assure you that this assessment will result in our identifying all risks that a target business may encounter. Furthermore, some of those risks may be outside of our control, meaning that we can do nothing to control or reduce the chances
that those risks will adversely affect a target business.
Sources of Target Businesses
We anticipate that target business candidates will be brought to our attention from various unaffiliated sources, including investment market
participants, private equity groups, investment banking firms, consultants, accounting firms and large business enterprises. Target businesses may be brought to our attention by such unaffiliated sources as a result of being solicited by us through
calls or mailings. These sources may also introduce us to target businesses in which they think we may be interested on an unsolicited basis, since some of these sources will have read this Report and know what types of businesses we are targeting.
Our officers and directors, as well as their affiliates, may also bring to our attention target business candidates that they become aware of through their business contacts as a result of formal or informal inquiries or discussions they may have,
as well as attending trade shows or conventions. In addition, we expect to receive a number of proprietary deal flow opportunities that would not otherwise necessarily be available to us as a result of the business relationships of our officers and
directors. While we do not presently anticipate engaging the services of professional firms or other individuals that specialize in business acquisitions on any formal basis, we may engage these firms or other individuals in the future, in which
event we may pay a finders fee, consulting fee or other compensation to be determined in an arms length negotiation based on the terms of the transaction. We will engage a finder only to the extent our management determines that the use
of a finder may bring opportunities to us that may not otherwise be available to us or if finders approach us on an unsolicited basis with a potential transaction that our management determines is in our best interest to pursue. Payment of
finders fees is customarily tied to completion of a transaction, in which case any such fee will be paid out of the funds held in the trust account. In no event, however, will our sponsor or any of our existing officers or directors, or their
respective affiliates paid by us any finders fee, consulting fee or other compensation prior to, or for any services they render in order to effectuate, the completion of our initial business combination (regardless of the type of transaction
that it is). We pay an affiliate of our sponsor a total of $10,000 per month for office space, secretarial and administrative support and to reimburse our sponsor for any
out-of-pocket expenses related to identifying, investigating and completing an initial business combination. Some of our officers and directors may enter into employment
or consulting agreements with the post-business combination company following our initial business combination. The presence or absence of any such fees or arrangements will not be used as a criterion in our selection process of an acquisition
candidate.
We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor,
officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor or any of our officers or directors, we, or a committee of independent directors, will obtain an opinion from
an independent investment banking firm or another independent entity that commonly renders valuation opinions that such initial business combination is fair to our company from a financial point of view. We are not required to obtain such an opinion
in any other context.
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Each of our officers and directors presently has, and any of them in the future may have,
additional, fiduciary or contractual obligations to other entities, including the Vector SPACs and other entities that are affiliates of our sponsor, pursuant to which such officer or director is or will be required to present a business combination
opportunity to such entity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will
honor his or her fiduciary or contractual obligations to present such business combination opportunity to such entity, subject to their fiduciary duties under Cayman Islands law.
Evaluation of a Target Business and Structuring of Our Initial Business Combination
In evaluating a prospective target business, we expect to conduct an extensive due diligence review which may encompass, as applicable and
among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities and a review of financial and other information about the target and its industry. We will also
utilize our management teams operational and capital planning experience. If we determine to move forward with a particular target, we will proceed to structure and negotiate the terms of the business combination transaction.
The time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs
associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of, and negotiation with, a prospective target business with which our initial business
combination is not ultimately completed will result in our incurring losses and will reduce the funds we can use to complete another business combination. The company will not pay any consulting fees to members of our management team, or their
respective affiliates, for services rendered to or in connection with our initial business combination. In addition, we have agreed not to enter into a definitive agreement regarding an initial business combination without the prior consent of our
sponsor.
Lack of Business Diversification
For an indefinite period of time after the completion of our initial business combination, the prospects for our success may depend entirely on
the future performance of a single business. Unlike other entities that have the resources to complete business combinations with multiple entities in one or several industries, it is probable that we will not have the resources to diversify our
operations and mitigate the risks of being in a single line of business. By completing our initial business combination with only a single entity, our lack of diversification may:
subject us to negative economic, competitive and regulatory developments, any or all of which may have a
substantial adverse impact on the particular industry in which we operate after our initial business combination; and
cause us to depend on the marketing and sale of a single product or limited number of products or services.
Limited Ability to Evaluate the Targets Management Team
Although we intend to closely scrutinize the management of a prospective target business when evaluating the desirability of effecting our
initial business combination with that business, our assessment of the target businesss management may not prove to be correct. In addition, the future management may not have the necessary skills, qualifications or abilities to manage a
public company. Furthermore, the future role of members of our management team, if any, in the target business cannot presently be stated with any certainty. The determination as to whether any of the members of our management team will remain with
the combined company will be made at the time of our initial business combination. While it is possible that one or more of our directors will remain associated in some capacity with us following our initial business combination, it is
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unlikely that any of them will devote their full efforts to our affairs subsequent to our initial business combination. Moreover, we cannot assure you that members of our management team will
have significant experience or knowledge relating to the operations of the particular target business.
We cannot assure you that any of
our key personnel will remain in senior management or advisory positions with the combined company. The determination as to whether any of our key personnel will remain with the combined company will be made at the time of our initial business
combination.
Following a business combination, we may seek to recruit additional managers to supplement the incumbent management of the
target business. We cannot assure you that we will have the ability to recruit additional managers, or that additional managers will have the requisite skills, knowledge or experience necessary to enhance the incumbent management.
Shareholders May Not Have the Ability to Approve Our Initial Business Combination
We may conduct redemptions without a shareholder vote pursuant to the tender offer rules of the SEC subject to the provisions of our amended
and restated memorandum and articles of association. However, we will seek shareholder approval if it is required by applicable law or stock exchange listing requirement, or we may decide to seek shareholder approval for business or other reasons.
Under the Nasdaqs listing rules, shareholder approval would typically be required for our initial business combination if, for
example:
We issue ordinary shares that will be equal to or in excess of 20% of the number of our ordinary shares then-outstanding (other
than in a public offering);
Any of our directors, officers or substantial shareholder (as defined by the Nasdaq rules) has a 5% or
greater interest (or such persons collectively have a 10% or greater interest), directly or indirectly, in the target business or assets to be acquired or in the consideration to be paid in the transaction and the present or potential issuance of
ordinary shares could result in an increase in issued and outstanding ordinary shares or voting power of 5% or more ; or
The issuance or
potential issuance of ordinary shares will result in our undergoing a change of control.
The decision as to whether we will seek
shareholder approval of a proposed business combination in those instances in which shareholder approval is not required by law will be made by us, solely in our discretion, and will be based on business and reasons, which include a variety of
factors, including, but not limited to:
the timing of the transaction, including in the event we determine shareholder approval would require additional
time and there is either not enough time to seek shareholder approval or doing so would place the company at a disadvantage in the transaction or result in other additional burdens on the company;
the expected cost of holding a shareholder vote;
the risk that the shareholders would fail to approve the proposed business combination;
other time and budget constraints of the company; and
additional legal complexities of a proposed business combination that would be time-consuming and burdensome to
present to shareholders.
Permitted Purchases and Other Transactions with Respect to Our Securities
If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
combination pursuant to the tender offer rules, our sponsor, directors,
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executive officers, advisors or their affiliates may purchase public shares or warrants in privately negotiated transactions or in the open market either prior to or following the completion of
our initial business combination. Additionally, at any time at or prior to our initial business combination, subject to applicable securities laws (including with respect to material nonpublic information), our sponsor, directors, executive
officers, advisors or their affiliates may enter into transactions with investors and others to provide them with incentives to acquire public shares, vote their public shares in favor of our initial business combination or not redeem their public
shares. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds in the trust account will be used to purchase public
shares or warrants in such transactions. If they engage in such transactions, they will be restricted from making any such purchases when they are in possession of any material non-public information not
disclosed to the seller or if such purchases are prohibited by Regulation M under the Securities Exchange Act. of 1934, as amended (the Exchange Act).
In the event that our sponsor, directors, officers, advisors or their affiliates purchase shares in privately negotiated transactions from
public shareholders who have already elected to exercise their redemption rights or submitted a proxy to vote against our initial business combination, such selling shareholders would be required to revoke their prior elections to redeem their
shares and any proxy to vote against our initial business combination. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private
transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will be required to comply with such rules.
The purpose of any such transaction could be to (i) vote in favor of the business combination and thereby increase the likelihood of
obtaining shareholder approval of the business combination, (ii) reduce the number of public warrants outstanding or vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business
combination or (iii) satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement
would otherwise not be met. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible.
In addition, if such purchases are made, the public float of our Class A ordinary shares or public warrants may be reduced
and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange.
Our sponsor, officers, directors and/or their affiliates may identify the shareholders with whom our sponsor, officers, directors or their
affiliates may pursue privately negotiated transactions by either the shareholders contacting us directly or by our receipt of redemption requests submitted by shareholders (in the case of Class A ordinary shares) following our mailing of
tender offer or proxy materials in connection with our initial business combination. To the extent that our sponsor, officers, directors, advisors or their affiliates enter into a private transaction, they would identify and contact only potential
selling or redeeming shareholders who have expressed their election to redeem their shares for a pro rata share of the trust account or vote against our initial business combination, whether or not such shareholder has already submitted a proxy
with respect to our initial business combination but only if such shares have not already been voted at the shareholder meeting related to our initial business combination. Our sponsor, executive officers, directors, advisors or their affiliates
will select which shareholders to purchase shares from based on the negotiated price and number of shares and any other factors that they may deem relevant, and will be restricted from purchasing shares if such purchases do not comply with
Regulation M under the Exchange Act and the other federal securities laws.
Our sponsor, officers, directors and/or their affiliates
will be restricted from making purchases of shares if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act. We expect any such purchases would be reported by such person
pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements.
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Redemption Rights for Public Shareholders upon Completion of Our Initial Business Combination
We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon
the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account calculated as of two business days prior to the
consummation of the initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our income taxes, if any, divided by the number of then-outstanding public shares, subject to
the limitations described herein. The amount in the trust account is initially anticipated to be $10.00 per public share. The per-share amount we will distribute to investors who properly redeem their shares
will not be reduced by the deferred underwriting commissions we will pay to Deutsche Bank Securities Inc. and BofA Securities, Inc., the underwriters of our initial public offering. The redemption rights will include the requirement that a
beneficial holder must identify itself in order to validly redeem its shares. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Further, we will not proceed with redeeming our
public shares, even if a public shareholder has properly elected to redeem its shares, if a business combination does not close. Our sponsor and each member of our management team have entered into an agreement with us, pursuant to which they have
agreed to waive their redemption rights with respect to any founder shares and public shares held by them in connection with (i) the completion of our initial business combination and (ii) a shareholder vote to approve an amendment to our
amended and restated memorandum and articles of association (A) that would modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our
initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of our initial public offering or (B) with respect to any other provision relating
to the rights of holders of our Class A ordinary shares.
Limitations on Redemptions
Our amended and restated memorandum and articles of association provide that in no event will we redeem our public shares in an amount that
would cause our net tangible assets to be less than $5,000,001 (so that we do not then become subject to the SECs penny stock rules). However, the proposed business combination may require: (i) cash consideration to be paid to
the target or its owners, (ii) cash to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed business
combination. In the event the aggregate cash consideration we would be required to pay for all Class A ordinary shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the
proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, and all Class A ordinary shares submitted for redemption will be returned to the holders
thereof.
Manner of Conducting Redemptions
We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the
completion of our initial business combination either (i) in connection with a shareholder meeting called to approve the business combination or (ii) by means of a tender offer. The decision as to whether we will seek shareholder approval
of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to
seek shareholder approval under applicable law or stock exchange listing requirement or whether we were deemed to be a foreign private issuer (which would require a tender offer rather than seeking shareholder approval under SEC rules). Asset
acquisitions and share purchases would not typically require shareholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our issued and outstanding ordinary shares or seek
to amend our amended and restated memorandum and articles of association would typically require shareholder approval. We currently intend to conduct redemptions in connection with a shareholder vote unless shareholder approval is not required by
applicable law or stock exchange listing
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requirement or we choose to conduct redemptions pursuant to the tender offer rules of the SEC for business or other reasons. So long as we obtain and maintain a listing for our securities on the
Nasdaq, we will be required to comply with the Nasdaq rules.
If we held a shareholder vote to approve our initial business combination,
we will, pursuant to our amended and restated memorandum and articles of association:
conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange
Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and
file proxy materials with the SEC.
In the event that we seek shareholder approval of our initial business combination, we will distribute proxy materials and, in connection
therewith, provide our public shareholders with the redemption rights described above upon completion of the initial business combination.
If we seek shareholder approval, we will complete our initial 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. In such case, our sponsor and each member of our management team have agreed to vote their founder shares and public
shares in favor of our initial business combination. As a result, in addition to our initial purchasers founder shares, we would need 12,000,001, or 37.5% (assuming all issued and outstanding shares are voted), or 2,000,001, or 6.25% (assuming
only the minimum number of shares representing a quorum are voted), of the 32,000,000 public shares sold in our initial public offering to be voted in favor of an initial business combination in order to have our initial business combination
approved. Each public shareholder may elect to redeem their public shares irrespective of whether they vote for or against the proposed transaction or vote at all. In addition, our sponsor and each member of our management team have entered into an
agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and public shares held by them in connection with (i) the completion of a business combination and (ii) a shareholder
vote to approve an amendment to our amended and restated memorandum and articles of association (A) that would modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their
shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of our initial public offering or (B) with
respect to any other provision relating to the rights of holders of our Class A ordinary shares.
If we conduct redemptions pursuant
to the tender offer rules of the SEC, we will, pursuant to our amended and restated memorandum and articles of association:
conduct the redemptions pursuant to Rule 13e-4 and
Regulation 14E of the Exchange Act, which regulate issuer tender offers; and
file tender offer documents with the SEC prior to completing our initial business combination which contain
substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies.
Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we
and our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase Class A ordinary shares in the open market, in order to comply with
Rule 14e-5 under the Exchange Act.
In the event we conduct redemptions pursuant to the
tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be
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permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public shareholders not tendering more
than the number of public shares we are permitted to redeem. If public shareholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete such initial business combination.
Limitation on Redemption upon Completion of Our Initial Business Combination If We Seek Shareholder Approval
If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association provide that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is
acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in our initial public offering, which
we refer to as Excess Shares, without our prior consent. We believe this restriction will discourage shareholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to exercise their
redemption rights against a proposed business combination as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public
shareholder holding more than an aggregate of 15% of the shares sold in our initial public offering could threaten to exercise its redemption rights if such holders shares are not purchased by us, our sponsor or our management at a premium to
the then-current market price or on other undesirable terms. By limiting our shareholders ability to redeem no more than 15% of the shares sold in our initial public offering without our prior consent, we believe we will limit the ability of a
small group of shareholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum
net worth or a certain amount of cash.
However, we would not be restricting our shareholders ability to vote all of their shares
(including Excess Shares) for or against our initial business combination.
Tendering Share Certificates in Connection with a Tender Offer or
Redemption Rights
Public shareholders seeking to exercise their redemption rights, whether they are record holders or hold their
shares in street name, will be required to either tender their certificates (if any) to our transfer agent prior to the date set forth in the proxy solicitation or tender offer materials, as applicable, mailed to such holders, or to
deliver their shares to the transfer agent electronically using The Depository Trust Companys DWAC (Deposit/ Withdrawal At Custodian) System, at the holders option, in each case up to two business days prior to the initially scheduled
vote to approve the business combination. The proxy solicitation or tender offer materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate the applicable delivery
requirements, which will include the requirement that a beneficial holder must identify itself in order to validly redeem its shares. Accordingly, a public shareholder would have from the time we send out our tender offer materials until the close
of the tender offer period, or up to two business days prior to the initially scheduled vote on the proposal to approve the business combination if we distribute proxy materials, as applicable, to tender its shares if it wishes to seek to exercise
its redemption rights. Given the relatively short period in which to exercise redemption rights, it is advisable for shareholders to use electronic delivery of their public shares.
There is a nominal cost associated with the above-referenced tendering process and the act of certificating the shares or delivering them
through the DWAC System. The transfer agent will typically charge the tendering broker a fee of approximately $80.00 and it would be up to the broker whether or not to pass this cost on to the redeeming holder. However, this fee would be incurred
regardless of whether or not we require holders seeking to exercise redemption rights to tender their shares. The need to deliver shares is a requirement of exercising redemption rights regardless of the timing of when such delivery must be
effectuated.
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The foregoing is different from the procedures used by many blank check companies. In order
to perfect redemption rights in connection with their business combinations, many blank check companies would distribute proxy materials for the shareholders vote on an initial business combination, and a holder could simply vote against a
proposed business combination and check a box on the proxy card indicating such holder was seeking to exercise his or her redemption rights. After the business combination was approved, the company would contact such shareholder to arrange for him
or her to deliver his or her certificate to verify ownership. As a result, the shareholder then had an option window after the completion of the business combination during which he or she could monitor the price of the companys
shares in the market. If the price rose above the redemption price, he or she could sell his or her shares in the open market before actually delivering his or her shares to the company for cancellation. As a result, the redemption rights, to which
shareholders were aware they needed to commit before the shareholder meeting, would become option rights surviving past the completion of the business combination until the redeeming holder delivered its certificate. The requirement for
physical or electronic delivery prior to the meeting ensures that a redeeming shareholders election to redeem is irrevocable once the business combination is approved.
Any request to redeem such shares, once made, may be withdrawn at any time up to two business days prior to the initially scheduled vote on
the proposal to approve the business combination, unless otherwise agreed to by us. Furthermore, if a holder of a public share delivered its certificate in connection with an election of redemption rights and subsequently decides prior to the
applicable date not to elect to exercise such rights, such holder may simply request that the transfer agent return the certificate (physically or electronically). It is anticipated that the funds to be distributed to holders of our public shares
electing to redeem their shares will be distributed promptly after the completion of our initial business combination.
If our initial
business combination is not approved or completed for any reason, then our public shareholders who elected to exercise their redemption rights would not be entitled to redeem their shares for the applicable pro rata share of the trust account.
In such case, we will promptly return any certificates delivered by public holders who elected to redeem their shares.
If our initial
proposed business combination is not completed, we may continue to try to complete a business combination with a different target until 24 months from the closing of our initial public offering.
Redemption of Public Shares and Liquidation If No Initial Business Combination
Our amended and restated memorandum and articles of association provide that we have 24 months from the closing of our initial public
offering to consummate an initial business combination. If we have not consummated an initial business combination within 24 months from the closing of our initial public offering, we 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 us to pay our income taxes, if any (less up to $100,000 of interest to pay dissolution expenses) divided by the number
of the then-outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidation distributions, if any); and (iii) as promptly as reasonably
possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject in the case of clauses (ii) and (iii) to our obligations under Cayman Islands law to
provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to consummate an initial business
combination within 24 months from the closing of our initial public offering. Our amended and restated memorandum and articles of association provide that, if we wind up for any other reason prior to the consummation of our initial business
combination, we will follow the foregoing procedures with respect to the liquidation of the trust account as promptly as reasonably possible but not more than ten business days thereafter, subject to applicable Cayman Islands law.
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Our sponsor and each member of our management team have entered into an agreement with us,
pursuant to which they have agreed to waive their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to consummate an initial business combination within 24 months from the closing
of our initial public offering (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame).
Our sponsor, executive officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any
amendment to our amended and restated memorandum and articles of association (A) that would modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in
connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of our initial public offering or (B) with respect to any
other provision relating to the rights of holders of our Class A ordinary shares, unless we provide our public shareholders with the opportunity to redeem their public shares upon approval of any such amendment 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 us to pay our
income taxes, if any, divided by the number of the then-outstanding public shares. However, we may not redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 (so that we do not then become subject
to the SECs penny stock rules). If this optional redemption right is exercised with respect to an excessive number of public shares such that we cannot satisfy the net tangible asset requirement, we would not proceed with the
amendment or the related redemption of our public shares at such time. This redemption right shall apply in the event of the approval of any such amendment, whether proposed by our sponsor, any executive officer or director, or any other person.
We expect that all costs and expenses associated with implementing our plan of dissolution, as well as payments to any creditors, will be
funded from amounts remaining out of the $865,903 held outside the trust account (as of December 31, 2020) plus up to $100,000 of funds from the trust account available to us to pay dissolution expenses, although we cannot assure you that there
will be sufficient funds for such purpose.
If we were to expend all of the net proceeds of our initial public offering and the sale of
the private placement warrants, other than the proceeds deposited in the trust account, and without taking into account interest, if any, earned on the trust account, the per-share redemption amount received
by shareholders upon our dissolution would be $10.00. The proceeds deposited in the trust account could, however, become subject to the claims of our creditors which would have higher priority than the claims of our public shareholders. We cannot
assure you that the actual per-share redemption amount received by shareholders will not be less than $10.00. While we intend to pay such amounts, if any, we cannot assure you that we will have funds
sufficient to pay or provide for all creditors claims.
Although we will seek to have all vendors, service providers (other than our
independent registered public accounting firm), prospective target businesses and other entities with which we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust
account for the benefit of our public shareholders, there is no guarantee that they will execute such agreements or even if they execute such agreements that they would be prevented from bringing claims against the trust account including, but not
limited, to fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain an advantage with respect to a claim against our assets,
including the funds held in the trust account. If any third-party refuses to execute an agreement waiving such claims to the monies held in the trust account, our management will perform an analysis of the alternatives available to it and will only
enter into an agreement with a third-party that has not executed a waiver if management believes that such third-partys engagement would be significantly more beneficial to us than any alternative. Examples of possible instances where we may
engage a third-party that refuses to execute a
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waiver include the engagement of a third-party consultant whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would
agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a waiver. In addition, there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of,
or arising out of, any negotiations, contracts or agreements with us and will not seek recourse against the trust account for any reason. In order to protect the amounts held in the trust account, our sponsor has agreed that it will be liable to us
if and to the extent any claims by a third-party for services rendered or products sold to us (other than our independent registered public accounting firm), or a prospective target business with which we have discussed entering into a transaction
agreement, reduce the amounts 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 public share due to reductions in the value of the trust assets, in each case net of the interest that may be withdrawn to pay our tax obligations, provided that such liability will not apply to any claims by a third-party or prospective
target business that executed a waiver of any and all rights to seek access to the trust account nor will it apply to any claims under our indemnity of the underwriters of our initial public offering against certain liabilities, including
liabilities under the Securities Act. In the event that an executed waiver is deemed to be unenforceable against a third-party, our sponsor will not be responsible to the extent of any liability for such third-party claims. However, we have not
asked our sponsor to reserve for such indemnification obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and we believe that our sponsors only assets are securities of
our company. Therefore, we cannot assure you that our sponsor would be able to satisfy those obligations. None of our officers or directors will indemnify us for claims by third parties including, without limitation, claims by vendors and
prospective target businesses.
In the event that the proceeds in the trust account are reduced 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 public share due to reductions in the value of the trust assets, in each case net
of the amount of interest which may be withdrawn to pay our income tax obligations, and our sponsor asserts that it is unable to satisfy its indemnification obligations or that it has no indemnification obligations related to a particular claim, our
independent directors would determine whether to take legal action against our sponsor to enforce its indemnification obligations. While we currently expect that our independent directors would take legal action on our behalf against our sponsor to
enforce its indemnification obligations to us, it is possible that our independent directors in exercising their business judgment may choose not to do so in any particular instance. Accordingly, we cannot assure you that due to claims of creditors
the actual value of the per-share redemption price will not be less than $10.00 per public share.
We will seek to reduce the possibility that our sponsor will have to indemnify the trust account due to claims of creditors by endeavoring to
have all vendors, service providers (other than our independent registered public accounting firm), prospective target businesses or other entities with which we do business execute agreements with us waiving any right, title, interest or claim of
any kind in or to monies held in the trust account. Our sponsor will also not be liable as to any claims under our indemnity of the underwriters of our initial public offering against certain liabilities, including liabilities under the Securities
Act. We will have access to up to $865,903 of proceeds held outside the trust account (as of December 31, 2020) with which to pay any such potential claims (including costs and expenses incurred in connection with our liquidation, currently
estimated to be no more than approximately $100,000). In the event that we liquidate and it is subsequently determined that the reserve for claims and liabilities is insufficient, shareholders who received funds from our trust account could be
liable for claims made by creditors, however such liability will not be greater than the amount of funds from our trust account received by any such shareholder.
If we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the proceeds held in the
trust account could be subject to applicable bankruptcy law, and may be included in our
bankruptcy estate and subject to the claims of third parties with
priority over the claims of our shareholders. To the extent any bankruptcy claims deplete the trust account, we cannot assure you we will be able to return $10.00
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per public share to our public shareholders. Additionally, if we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, any distributions
received by shareholders could be viewed under applicable debtor/creditor and/or bankruptcy laws as either a preferential transfer or a fraudulent conveyance. As a result, a bankruptcy court could seek to recover some or all
amounts received by our shareholders. Furthermore, our board of directors may be viewed as having breached its fiduciary duty to our creditors and/or may have acted in bad faith, and thereby exposing itself and our company to claims of punitive
damages, by paying public shareholders from the trust account prior to addressing the claims of creditors. We cannot assure you that claims will not be brought against us for these reasons.
Our public shareholders ware entitled to receive funds from the trust account only (i) in the event of the redemption of our public
shares if we do not complete our initial business combination within 24 months from the closing of our initial public offering, (ii) in connection with a shareholder vote to amend our amended and restated memorandum and articles of
association (A) to modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our
public shares if we do not complete our initial business combination within 24 months from the closing of our initial public offering or (B) with respect to any other provision relating to the rights of holders of our Class A ordinary
shares, or (iii) if they redeem their respective shares for cash upon the completion of the initial business combination. Public shareholders who redeem their Class A ordinary shares in connection with a shareholder vote described in
clause (ii) in the preceding sentence shall not be entitled to funds from the trust account upon the subsequent completion of an initial business combination or liquidation if we have not consummated an initial business combination within
24 months from the closing of our initial public offering, with respect to such Class A ordinary shares so redeemed. In no other circumstances will a shareholder have any right or interest of any kind to or in the trust account. In the
event we seek shareholder approval in connection with our initial business combination, a shareholders voting in connection with the business combination alone will not result in a shareholders redeeming its shares to us for an
applicable pro rata share of the trust account. Such shareholder must have also exercised its redemption rights described above. These provisions of our amended and restated memorandum and articles of association, like all provisions of our
amended and restated memorandum and articles of association, may be amended with a shareholder vote.
Competition
In identifying, evaluating and selecting a target business for our initial business combination, we may encounter intense competition from
other entities having a business objective similar to ours, including other blank check companies, private equity groups and leveraged buyout funds, public companies and operating businesses seeking strategic acquisitions. Many of these entities are
well established and have extensive experience identifying and effecting business combinations directly or through affiliates. Moreover, many of these competitors possess greater financial, technical, human and other resources than us. Our ability
to acquire larger target businesses will be limited by our available financial resources. This inherent limitation gives others an advantage in pursuing the acquisition of a target business. Furthermore, our obligation to pay cash in connection with
our public shareholders who exercise their redemption rights may reduce the resources available to us for our initial business combination and our outstanding warrants, and the future dilution they potentially represent, may not be viewed favorably
by certain target businesses. Either of these factors may place us at a competitive disadvantage in successfully negotiating an initial business combination.
Facilities
We currently maintain our
executive offices at One Market Street, Steuart Tower, 23rd Floor, San Francisco, CA 94105. The cost for our use of this space is included in the $10,000 per month fee we pay to an affiliate of our sponsor for office space, administrative and
support services. We consider our current office space adequate for our current operations.
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Employees
We currently have three executive officers. These individuals are not obligated to devote any specific number of hours to our matters but they
intend to devote as much of their time as they deem necessary to our affairs until we have completed our initial business combination. The amount of time they will devote in any time period will vary based on whether a target business has been
selected for our initial business combination and the stage of the business combination process we are in. We do not intend to have any full time employees prior to the completion of our initial business combination.
Periodic Reporting and Financial Information
We registered our units, Class A ordinary shares and warrants under the Exchange Act and have reporting obligations, including the
requirement that we file annual, quarterly and current reports with the SEC. In accordance with the requirements of the Exchange Act, our annual reports contain financial statements audited and reported on by our independent registered public
accountants.
We will provide shareholders with audited financial statements of the prospective target business as part of the proxy
solicitation or tender offer materials, as applicable, sent to shareholders. These financial statements may be required to be prepared in accordance with, or reconciled to, GAAP, or IFRS, depending on the circumstances, and the historical financial
statements may be required to be audited in accordance with the standards of the PCAOB. These financial statement requirements may limit the pool of potential target businesses we may acquire because some targets may be unable to provide such
statements in time for us to disclose such statements in accordance with federal proxy rules and complete our initial business combination within the prescribed time frame. We cannot assure you that any particular target business identified by us as
a potential acquisition candidate will have financial statements prepared in accordance with the requirements outlined above, or that the potential target business will be able to prepare its financial statements in accordance with the requirements
outlined above. To the extent that these requirements cannot be met, we may not be able to acquire the proposed target business. While this may limit the pool of potential acquisition candidates, we do not believe that this limitation will be
material.
We will be required to evaluate our internal control procedures for the fiscal year ending December 31, 2021 as required
by the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act. Only in the event we are deemed to be a large accelerated filer or an accelerated filer and no longer qualify as an emerging growth company, will we be required to comply with the
independent registered public accounting firm attestation requirement on our internal control over financial reporting. A target business may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of their internal
controls. The development of the internal controls of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to complete any such acquisition.
On September 24, 2020, we filed a Registration Statement on Form 8-A with the SEC to voluntarily
register our securities under Section 12 of the Exchange Act. As a result, we are subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other
obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination.
We are a Cayman Islands
exempted company. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied
for and expect to receive, after the effectiveness of the registration statement of which the final prospectus relating to our initial public offering forms a part, a tax exemption undertaking from the Cayman Islands government that, in accordance
with Section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands, for a period of 30 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits,
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income, gains or appreciations will apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or
inheritance tax will be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our
shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us.
We are an
emerging growth company, as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to
other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure
obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder
approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile.
In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the
extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting
standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period.
We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth
anniversary of the completion of our initial public offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of
our Class A ordinary shares that are held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.
Additionally, we are a smaller reporting
company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only
two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates
equals or exceeds $250 million as of the prior June 30, and (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year or the market value of our ordinary shares held by non-affiliates equals or exceeds $700 million as of the prior June 30.
Legal Proceedings
There is no material litigation, arbitration or governmental proceeding currently pending against us or any members of our management team in
their capacity as such.
Availability of Reports and Other Information
SEC filings, including our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and all amendments and exhibits to those reports are available through the SECs website, http://www.sec.gov. We will provide paper
copies of such filings free of charge upon request. At this time, we do not maintain a website and there is no estimate for when such a website will be maintained by us.
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Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.