NOTES
TO CONDENSED FINANCIAL STATEMENTS
JUNE
30, 2021
(Unaudited)
Note
1 — Description of Organization and Business Operations
FinTech
Acquisition Corp. V (the “Company”) is a blank check company incorporated in Delaware on April 22, 2019. The Company was
formed for the purpose of acquiring, through a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or other
similar business transaction, one or more operating businesses or assets (a “Business Combination”). The Company has neither
engaged in any operations nor generated significant revenue to date.
As
of June 30, 2021, the Company had not commenced operations. All activity through June 30, 2021 relates to the Company’s formation,
the Initial Public Offering (as defined below), and, subsequent to the Initial Public Offering, identifying a target company for a Business
Combination and the potential acquisition, with eToro Group Ltd as more fully described in Note 6.
The
registration statement for the Company’s Initial Public Offering was declared effective on December 3, 2020. On December 8, 2020,
the Company consummated the Initial Public Offering of 25,000,000 units (the “Units” and, with respect to the Class A common
stock included in the Units sold, the “Public Shares”), which includes the partial exercise by the underwriters of their
over-allotment option in the amount of 3,200,000 Units, at $10.00 per Unit, generating gross proceeds of $250,000,000 which is described
in Note 3.
Simultaneously
with the closing of the Initial Public Offering, the Company consummated the sale of 640,000 units (the “Private Placement Units”)
at a price of $10.00 per Private Placement Unit in a private placement to FinTech Investor Holdings V, LLC, that closed simultaneously
with the Initial Public Offering, generating gross proceeds of $6,400,000, which is described in Note 4. The manager of FinTech Investor
Holdings V, LLC is Cohen Sponsor Interests V, LLC.
Transaction
costs amounted to $15,461,590, consisting of $4,360,000 in cash underwriting fees, $10,640,000 of deferred underwriting fees and $461,590
of other offering costs.
Following the closing of the Initial Public Offering on December 8,
2020, an amount of $250,000,000 ($10.00 per Unit) from the net proceeds of the sale of the Units in the Initial Public Offering and the
sale of the Private Placement Units was placed in a trust account (the “Trust Account”) and invested in U.S. government securities,
within the meaning of Section 2(a)(16) of the Investment Company Act of 1940, as amended, or the Investment Company Act, with a maturity
of 185 days or less, or in money market funds meeting certain conditions under Rule 2a-7 of the Investment Company Act, which
invest only in direct U.S. government treasury obligations, until the earlier of: (i) the consummation of a Business Combination;
(ii) the redemption of any Public Shares in connection with a stockholder vote to amend the Company’s amended and restated
certificate of incorporation (a) to modify the substance or timing of the Company’s obligation to redeem 100% of its Public
Shares if it does not complete an initial Business Combination by December 8, 2022 (the “Combination Period”) or (b) with
respect to any other provisions relating to stockholders’ rights or pre-initial Business Combination activity; or (iii) the
distribution of the Trust Account, as described below, except that interest earned on the Trust Account can be released to pay the Company’s
tax obligations, if the Company is unable to complete an initial Business Combination within the Combination Period or upon any earlier
liquidation of the Company.
The
Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering
and Private Placement Units, although substantially all of the net proceeds are intended to be applied generally toward consummating
a Business Combination. Nasdaq Capital Market (“NASDAQ”) rules provide that the Company’s initial Business Combination
must be with one or more target businesses that together have a fair market value equal to at least 80% of the balance in the Trust Account
(less any deferred underwriting commissions and taxes payable on interest earned) at the time of the signing a definitive agreement in
connection with a Business Combination. However, the Company will only complete a Business Combination if the post-Business Combination
company owns or acquires a majority of the outstanding voting securities of the target or otherwise acquires a controlling interest in
the target sufficient for it not to be required to register as an investment company under the Investment Company Act. There is no assurance
that the Company will be able to successfully effect a Business Combination.
The
Company will provide its stockholders with the opportunity to redeem all or a portion of the Public Shares upon the completion of a Business
Combination either (i) in connection with a stockholder meeting called to approve the Business Combination or (ii) by means
of a tender offer. The decision as to whether the Company will seek stockholder approval of a Business Combination or conduct a tender
offer will be made by the Company, solely in its discretion. The stockholders will be entitled to redeem their shares for a pro rata
portion of the amount then on deposit in the Trust Account (initially approximately $10.00 per share, plus any pro rata interest earned
on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations). The per-share amount to
be distributed to stockholders who redeem their shares will not be reduced by the deferred underwriting commissions the Company will
pay to the representative (as discussed in Note 6). There will be no redemption rights upon the completion of a Business Combination
with respect to the Company’s warrants.
FINTECH
ACQUISITION CORP. V
NOTES
TO CONDENSED FINANCIAL STATEMENTS
JUNE
30, 2021
(Unaudited)
The Company will proceed with a Business Combination only if the Company
has net tangible assets of at least $5,000,001 upon consummation of a Business Combination and, if the Company seeks stockholder approval,
a majority of the outstanding shares are voted in favor of the Business Combination. If a stockholder vote is not required by law and
the Company does not decide to hold a stockholder vote for business or other legal reasons, the Company will, pursuant to its amended
and restated certificate of incorporation, conduct the redemptions pursuant to the tender offer rules of the Securities and Exchange Commission
(“SEC”), and file tender offer documents with the SEC prior to completing a Business Combination. If, however, stockholder
approval of the transaction is required by law, or the Company decides to obtain stockholder approval for business or other legal reasons,
the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender
offer rules. If the Company seeks stockholder approval in connection with a Business Combination, FinTech Investor Holdings V, LLC and
FinTech Masala Advisors V, LLC (collectively, the “Sponsor”) and the Company’s officers and directors (together with
the Sponsor, the “Insiders”) have agreed to vote their Founder Shares (as defined in Note 5), the shares of Class A common
stock included in the Private Placement Units (the “Private Placement Shares”) and any Public Shares held by them in favor
of approving a Business Combination.
The
Company will have until the expiration of the Combination Period to consummate its initial Business Combination. If the Company is unable
to consummate a Business Combination within the Combination Period, the Company will (i) cease all operations except for the purposes
of winding up its affairs; (ii) distribute the aggregate amount then on deposit in the Trust Account, including any amounts representing
interest earned on the Trust Account not previously released to the Company to pay its franchise and income taxes and up to $100,000
to pay dissolution expenses, pro rata to the public stockholders by way of redemption of the Public Shares (which redemption would completely
extinguish such holders’ rights as stockholders, including the right to receive further liquidation distributions, if any); and
(iii) as promptly as possible following such redemption, dissolve and liquidate the balance of the Company’s net assets to
its remaining stockholders, as part of its plan of dissolution and liquidation.
The
Company will also provide its stockholders with the opportunity to redeem all or a portion of their Public Shares in connection with
any stockholder vote to approve an amendment to the Company’s amended and restated certificate of incorporation (i) that would
modify the substance or timing of the Company’s obligation to redeem 100% of Public Shares if it does not complete an initial Business
Combination within the Combination Period or (ii) with respect to any other provisions relating to stockholders’ rights or
pre-initial Business Combination activity. The stockholders will be entitled to redeem their shares for a pro rata portion of the amount
then on deposit in the Trust Account (initially approximately $10.00 per share, plus any pro rata interest earned on the funds held in
the Trust Account, net of taxes payable). The per-share amount to be distributed to stockholders who redeem their shares will not be
reduced by the deferred underwriting commissions the Company will pay to the representative (as discussed in Note 6). There will be no
redemption rights with respect to the Company’s warrants in connection with any stockholder vote to approve an amendment to the
Company’s amended and restated certificate of incorporation. Notwithstanding the foregoing, the Company may not redeem shares in
an amount that would cause its net tangible assets to be less than $5,000,001. The Insiders have agreed to vote any Founder Shares, Private
Placement Shares and any Public Shares held by them in favor of any such amendment.
The
Insiders have agreed to waive their redemption rights with respect to any Founder Shares and Private Placement Shares, as applicable,
(i) in connection with the consummation of a Business Combination, (ii) in connection with a stockholder vote to amend the
Company’s amended and restated certificate of incorporation (a) to modify the substance or timing of the Company’s obligation
to redeem 100% of its Public Shares if it does not complete its initial Business Combination within the Combination Period or (b) with
respect to any other provisions relating to stockholders’ rights or pre-initial Business Combination activity, and (iii) if
the Company fails to consummate a Business Combination within the Combination Period. The Insiders have also agreed to waive their redemption
rights with respect to any Public Shares held by them in connection with the consummation of a Business Combination and in connection
with a stockholder vote to amend the Company’s amended and restated certificate of incorporation (i) to modify the substance
or timing of the Company’s obligation to redeem 100% of its Public Shares if it does not complete its initial Business Combination
within the Combination Period or (ii) with respect to any other provisions relating to stockholders’ rights or pre-initial
Business Combination activity. However, the Insiders will be entitled to redemption rights with respect to Public Shares if the Company
fails to consummate a Business Combination or liquidates within the Combination Period. The representative of the underwriters has agreed
to waive its rights to deferred underwriting commissions held in the Trust Account in the event the Company does not consummate a Business
Combination within the Combination Period and, in such event, such amounts will be included with the funds held in the Trust Account
that will be available to fund the redemption of the Public Shares. In the event of such distribution, it is possible that the per share
value of the residual assets remaining available for distribution (including Trust Account assets) will be less than the initial public
offering price per Unit in the Initial Public Offering. Placing funds in the Trust Account may not protect those funds from third party
claims against the Company. Although the Company will seek to have all vendors, service providers, prospective target businesses or other
entities it engages (except for the Company’s independent registered public accounting firm), execute agreements with the Company
waiving any claim of any kind in or to any monies held in the Trust Account, there is no guarantee that such persons will execute such
agreements. FinTech Investor Holdings V, LLC has agreed that it will be liable under certain circumstances to ensure that the proceeds
in the Trust Account are not reduced by the claims of target businesses or vendors or other entities that are owed money by the Company
for service rendered, contracted for or products sold to the Company to below (i) $10.00 per Public Share or (ii) such lesser amount
per Public Share held in the Trust Account as of the date of the liquidation of the Trust Account due to reductions in the value of the
trust assets. However, it may not be able to satisfy those obligations should they arise.
FINTECH
ACQUISITION CORP. V
NOTES
TO CONDENSED FINANCIAL STATEMENTS
JUNE
30, 2021
(Unaudited)
Notwithstanding the foregoing redemption rights, if the Company seeks
stockholder approval of its Business Combination and it does not conduct redemptions in connection with its Business Combination pursuant
to the tender offer rules, the amended and restated certificate of incorporation provides that a public stockholder, together with any
affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined
under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to an aggregate of 15% or more of
the shares sold in the Initial Public Offering. However, there is no restriction on the Company’s stockholders’ ability to
vote all of their shares for or against a Business Combination.
Going Concern and Liquidity
As of June 30, 2020, the Company had $310,552
in its operating bank accounts, $250,013,974 in securities held in the Trust Account to be used for a Business Combination or to repurchase
or redeem its common stock in connection therewith and working capital deficit of $929,272. As of June 30, 2020, approximately $13,974
of the amount on deposit in the Trust Account represented interest income, which is available to pay the Company’s tax obligations.
If the Company is unable to raise additional capital,
it may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, suspending
the pursuit of a Business Combination. The Company cannot provide any assurance that new financing will be available to it on commercially
acceptable terms, if at all.
As a result of the above, in connection with the Company’s assessment
of going concern considerations in accordance with Financial Accounting Standard Board’s Accounting Standards Update (“ASU”)
2014-15, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” management has determined
that the liquidity condition raise substantial doubt about the Company’s ability to continue as a going concern. These consolidated
financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities
that might be necessary should the Company be unable to continue as a going concern.
Note
2 — Summary of Significant Accounting Policies
Basis
of Presentation
The
accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted
in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form
10-Q and Article 8 of Regulation S-X of the SEC. Certain information or footnote disclosures normally included in financial statements
prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial
reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position,
results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed interim financial statements
include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position,
operating results and cash flows for the periods presented.
The
accompanying unaudited condensed financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K/A
for the year ended December 31, 2020 as filed with the SEC on May 14, 2021, which contains the audited financial statements and notes
thereto. The interim results for the three and six months ended June 30, 2021 are not necessarily indicative of the results to be expected
for the year ending December 31, 2021 or for any future interim periods.
FINTECH
ACQUISITION CORP. V
NOTES
TO CONDENSED FINANCIAL STATEMENTS
JUNE
30, 2021
(Unaudited)
Emerging
Growth Company
The
Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart
Our Business Startups Act of 2012 (the “JOBS Act”), and it may 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 independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley
Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from
the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments
not previously approved.
Further,
Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial
accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective
or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting
standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements
that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of
such extended transition period, which means that when a standard is issued or revised and it has different application dates for public
or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies
adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which
is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult
or impossible because of the potential differences in accounting standards used.
Use
of Estimates
The
preparation of condensed financial statements in conformity with GAAP requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the
condensed financial statements and the reported amounts of revenues and expenses during the reporting period.
Making estimates requires management to exercise
significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances
that existed at the date of the condensed financial statements, which management considered in formulating its estimate, could change
in the near term due to one or more future events. One of the more significant accounting estimates included in these condensed financial
statements is the determination of the fair value of the warrant liabilities. Such estimates may be subject to change as more current
information becomes available and, accordingly, the actual results could differ significantly from those estimates.
FINTECH
ACQUISITION CORP. V
NOTES
TO CONDENSED FINANCIAL STATEMENTS
JUNE
30, 2021
(Unaudited)
Cash
and Cash Equivalents
The
Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents.
The Company did not have any cash equivalents as of June 30, 2021 and December 31, 2020.
Marketable
Securities Held in Trust Account
The
Company’s portfolio of investments held in the Trust Account is comprised of U.S. government securities, within the meaning set forth
in Section 2(a)(16) of the Investment Company Act, with a maturity of 185 days or less, or investments in money market funds that invest
in U.S. government securities, or a combination thereof. At June 30, 2021 and December 31, 2020, the assets held in the Trust Account
were held in money market funds which are invested primarily in U.S. Treasury Securities.
Warrant
Liabilities
The Company does not use derivative instruments
to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its financial instruments, including
issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives,
pursuant to Accounting Standards Codification (“ASC”) Topic 480, “Distinguishing Liabilities from Equity” (“ASC
480”) and FASB ASC Topic 815, “Derivatives and Hedging” (“ASC 815”). The Company accounts for the Public
Warrants and Private Placement Warrants (together with the Public Warrants, the “Warrants”) in accordance with the guidance
contained in ASC 815-40 under which the Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly,
the Company classifies the Warrants as liabilities at their fair value and adjusts them to fair value at each reporting period. This liability
is subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in the statement of
operations. The Warrants for periods where no observable trading price was available are valued using a Modified Black-Scholes Option
Pricing model. For periods subsequent to the detachment of the Public Warrants from the Units, the Public Warrant quoted market price
was used as the fair value as of each relevant date.
Common Stock Subject to Possible Redemption
The Company accounts for its Class A common stock
subject to possible redemption in accordance with the guidance in ASC 480. Class A common stock subject to mandatory redemption is classified
as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption
rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within
the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’
equity. The Company’s Class A common stock features certain redemption rights that are considered to be outside of the Company’s
control and subject to occurrence of uncertain future events. Accordingly, at June 30, 2021 and December 31, 2020, 20,604,656 and 21,855,299,
respectively, Class A common stock subject to possible redemption is presented as temporary equity, outside of the stockholders’
equity section of the Company’s condensed balance sheets.
Offering
Costs
Offering costs consisted of underwriting, legal,
accounting and other expenses incurred through the Initial Public Offering that were directly related to the Initial Public Offering.
Offering costs are allocated to the separable financial instruments issued in the Initial Public Offering based on a relative fair value
basis, compared to total proceeds received. Offering costs associated with derivative warrant liabilities are expenses as incurred, presented
as non-operating expenses in the statement of operations. Offering costs associated with the Public Shares were charged to stockholders’
equity upon the completion of the Initial Public Offering. Offering costs amounted to $15,461,590, of which $15,038,973 were charged to
stockholders’ equity upon the completion of the Initial Public Offering and $422,617 were charged to the statement of operations.
Income
Taxes
The Company accounts for income taxes under ASC
Topic 740 “Income Taxes” (“ASC 740”), which requires an asset and liability approach to financial accounting and
reporting for income taxes. Deferred income tax assets and liabilities are computed for differences between the financial statement and
tax bases of assets and liabilities that will result in future taxable or deductible amounts, based on enacted tax laws and rates applicable
to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to
reduce deferred tax assets to the amount expected to be realized.
ASC
740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions
taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be
sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits
as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of June 30, 2021
and December 31, 2020. The Company is currently not aware of any issues under review that could result in significant payments,
accruals or material deviation from its position.
The
Company may be subject to potential examination by federal, state and city taxing authorities in the areas of income taxes. These potential
examinations may include questioning the timing and amount of deductions, the nexus of income among various tax jurisdictions and compliance
with federal, state and city tax laws. The Company’s management does not expect that the total amount of unrecognized tax benefits
will materially change over the next twelve months. The Company is subject to income tax examinations by major taxing authorities since
inception.
FINTECH
ACQUISITION CORP. V
NOTES
TO CONDENSED FINANCIAL STATEMENTS
JUNE
30, 2021
(Unaudited)
Net
Income (Loss) Per Common Share
The Company complies with the accounting and disclosure
requirements of ASC Topic 260, “Earnings Per Share.” Net income (loss) per share is computed by dividing net income (loss)
by the weighted average number of common stock outstanding for the period. The calculation of diluted income (loss) per share does not
consider the effect of the warrants issued in connection with the (i) Initial Public Offering, (ii) the partial exercise of the over-allotment
option and (iii) the Private Placement Units since the exercise of the warrants are contingent upon the occurrence of future events and
the inclusion of such warrants would be anti-dilutive. The warrants oustanding to purchase 8,456,667 shares of Class A common stock in
the aggregate.
The Company’s unaudited condensed statements
of operations includes a presentation of loss per share for common stock subject to possible redemption in a manner similar to the two-class
method of loss per share. Net income per common share, basic and diluted, for Class A redeemable common stock is calculated by dividing
the interest income earned on the Trust Account, by the weighted average number of Class A redeemable common stock outstanding since original
issuance. Net loss per common share, basic and diluted, for Class A and Class B non-redeemable common stock is calculated by dividing
the net loss, adjusted for income attributable to Class A redeemable common stock, by the weighted average number of Class A and Class
B non-redeemable common stock outstanding for the period. Class A and B non-redeemable common stock includes the Founder Shares as these
shares do not have any redemption features and do not participate in the income earned on the Trust Account.
The
following table reflects the calculation of basic and diluted net income (loss) per common share (in dollars, except per share amounts):
|
|
Three Months Ended
June 30,
2021
|
|
|
Six Months Ended
June 30,
2021
|
|
Redeemable Class A Common Stock
|
|
|
|
|
|
|
Numerator: Earnings allocable to Redeemable Class A Common Stock
|
|
|
|
|
|
|
Interest Income
|
|
|
6,233
|
|
|
|
12,398
|
|
Less: Income and Franchise Tax
|
|
|
(6,233
|
)
|
|
|
(12,398
|
)
|
Redeemable Net Earnings
|
|
$
|
—
|
|
|
$
|
—
|
|
Denominator: Weighted Average Redeemable Class A Common Stock
|
|
|
|
|
|
|
|
|
Redeemable Class A Common Stock, Basic and Diluted
|
|
|
25,000,000
|
|
|
|
25,000,000
|
|
Earnings/Basic and Diluted per share, Redeemable Class A Common Stock
|
|
$
|
0.00
|
|
|
$
|
0.00
|
|
|
|
|
|
|
|
|
|
|
Non-Redeemable Class A and B Common Stock
|
|
|
|
|
|
|
|
|
Numerator: Net Loss minus Redeemable Net Earnings
|
|
|
|
|
|
|
|
|
Net Loss
|
|
$
|
(7,542,522
|
)
|
|
$
|
(12,506,432
|
)
|
Less: Redeemable Net Earnings
|
|
|
—
|
|
|
|
—
|
|
Non-Redeemable Net Loss
|
|
$
|
(7,542,522
|
)
|
|
$
|
(12,506,432
|
)
|
Denominator: Weighted Average Non-Redeemable Class A and B Common Stock
|
|
|
|
|
|
|
|
|
Non-Redeemable Class B Common Stock, Basic and Diluted (1)
|
|
|
9,186,667
|
|
|
|
9,186,667
|
|
Loss/Basic and Diluted per share, Non-Redeemable Class A and B Common Stock
|
|
$
|
(0.82
|
)
|
|
$
|
(1.36
|
)
|
(1)
|
The weighted average non-redeemable common stock at June 30, 2021 includes the effect of 640,000 Private Placement Units, which were issued in conjunction with the Initial Public Offering on December 8, 2020.
|
Concentration
of Credit Risk
Financial
instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution,
which, at times, may exceed the Federal Depository Insurance Corporation limit of $250,000. The Company has not experienced losses on
this account and management believes the Company is not exposed to significant risks on such account.
FINTECH
ACQUISITION CORP. V
NOTES
TO CONDENSED FINANCIAL STATEMENTS
JUNE
30, 2021
(Unaudited)
Fair
Value of Financial Instruments
The
fair value of the Company’s assets and liabilities which qualify as financial instruments under ASC Topic 820, “Fair Value
Measurement,” approximate the carrying amounts represented in the Company’s condensed balance sheet, primarily due to their
short-term nature other than warrant liabilities (see Note 8). As of June 30, 2021 and December 31, 2020, the carrying values of cash,
accounts payable and accrued expenses approximate their fair values due to the short-term nature of the instruments. The Company’s
portfolio of marketable securities held in the Trust Account is comprised of investments in U.S. Treasury securities with an original
maturity of 185 days or less. The fair value for trading securities is determined using quoted market prices in active markets.
Recent
Accounting Standards
In
August 2020, the Financial Accounting Standards Board issued Accounting Standard Update (“ASU”) No. 2020-06, Debt—Debt
with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic
815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”), which simplifies
accounting for convertible instruments by removing major separation models required under current GAAP. The ASU also removes certain
settlement conditions that are required for equity-linked contracts to qualify for the derivative scope exception, and it simplifies
the diluted earnings per share calculation in certain areas. The Company adopted ASU 2020-06 on January 1, 2021. Adoption of the ASU
did not impact the Company’s financial position, results of operations or cash flows.
Management
does not believe that any other recently issued, but not yet effective, accounting standards if currently adopted would have a material
effect on the Company’s condensed financial statements.
Note
3 — Initial Public Offering
Pursuant to the Initial Public Offering, the Company
sold 25,000,000 Units, which includes a partial exercise by the underwriters of their over-allotment option in the amount of 3,200,000
Units, at a purchase price of $10.00 per Unit. Each Unit consists of one share of Class A common stock and one-third of one warrant
(“Public Warrant”). Each whole Public Warrant entitles the holder to purchase one share of Class A common stock at an
exercise price of $11.50, subject to adjustment (see Note 8).
Note
4 — Private Placement
Simultaneously with the closing of the Initial
Public Offering, FinTech Investor Holdings V, LLC purchased 640,000 Private Placement Units at a price of $10.00 per Private Placement
Unit, or $6,400,000 in the aggregate in a private placement. Each Private Placement Unit consists of one share of Class A common
stock and one-third of one warrant (the “Private Placement Warrant”). Each whole Private Placement Warrant is exercisable
for one whole share of Class A common stock at a price of $11.50 per share, subject to adjustment. The proceeds from the sale of
the Private Placement Units were added to the proceeds from the Initial Public Offering held in the Trust Account. If the Company does
not complete a Business Combination within the Combination Period, the proceeds from the sale of the Private Placement Units will be used
to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Placement Warrants will expire
worthless. There will be no redemption rights or liquidating distributions from the Trust Account with respect to the Private Placement
Warrants.
FINTECH
ACQUISITION CORP. V
NOTES
TO CONDENSED FINANCIAL STATEMENTS
JUNE
30, 2021
(Unaudited)
Note
5 — Related Party Transactions
Founder
Shares
In
June 2019, the Company issued an aggregate of 1,000 shares of common stock to FinTech Investor Holdings V, LLC (the “Founder
Shares”) for an aggregate purchase price of $25,000. FinTech Investor Holdings V, LLC paid for certain offering costs
on behalf of the Company in October 2020 in lieu of remitting payment for the purchase of the Founder Shares to the Company.
In October 2020, the Company filed an amendment
to its certificate of incorporation to, among other things, create two classes of common stock, Class A and Class B, and to
convert the outstanding Founder Shares into shares of Class B common stock. The Founder Shares will automatically convert into shares
of Class A common stock upon consummation of a Business Combination on a one-for-one basis, subject to certain adjustments, as described
in Note 7. Additionally, the Company completed an approximate 8,455-for-1 forward stock split of its common stock and a share dividend
of 1.01360142. As a result of these transactions, the Sponsor held 8,570,000 Founder Shares, of which 1,090,000 shares were subject to
forfeiture to the extent that the underwriters’ over-allotment option was not exercised in full or in part, so that the Founder
Shares would represent 25% of the Company’s aggregate Founder Shares, Private Placement Shares and issued and outstanding Public
Shares after the Initial Public Offering. As a result of the underwriters’ election to partially exercise their over-allotment option
and the forfeiture of their remaining over-allotment option, 23,333 Founder Shares were forfeited and 1,066,667 Founder Shares are no
longer subject to forfeiture, resulting in an aggregate of 8,546,667 Founder Shares issued and outstanding.
The
Insiders have agreed not to transfer, assign or sell any of their Founder Shares (except to permitted transferees) (i) with respect
to 25% of such shares, until consummation of the Company’s initial Business Combination, (ii) with respect to 25% of such
shares, until the closing price of the Class A common stock exceeds $12.00 for any 20 trading days within a 30-trading day period
following the consummation of a Business Combination, (iii) with respect to 25% of such shares, until the closing price of the Class A
common stock exceeds $13.50 for any 20 trading days within a 30-trading day period following the consummation of a Business Combination,
and (iv) with respect to 25% of such shares, until the closing price of the Class A common stock exceeds $17.00 for any 20
trading days within a 30-trading day period following the consummation of a Business Combination or earlier, in any case, if, following
a Business Combination, the Company completes a liquidation, merger, capital stock exchange, reorganization or other similar transaction
that results in all of the public stockholders having the right to exchange their shares of common stock for cash, securities or other
property.
Administrative
Services Agreement
The
Company agreed, commencing on December 4, 2020 through the earlier of the Company’s consummation of a Business Combination and
its liquidation, to pay the Sponsor or an affiliate of the Sponsor $20,000 per month for office space, administrative and shared personnel
support services. For the three and six months ended June 30, 2021, the Company incurred and paid $60,000 and $120,000 for administrative
services, respectively.
Related
Party Loans
In
order to finance transaction costs in connection with a Business Combination, the Sponsor, members of the Company’s management
team or any of their respective affiliates or other third parties may, but are not obligated to, loan the Company funds as may be required
(“Working Capital Loans”), which will be repaid only upon the consummation of a Business Combination. If the Company does
not consummate a Business Combination, the Company may use a portion of any funds held outside the Trust Account to repay the Working
Capital Loans; however, no proceeds from the Trust Account may be used for such repayment. If such funds are insufficient to repay the
Working Capital Loans, the unpaid amounts would be forgiven. The Working Capital Loans may be converted into units at a price of $10.00
per unit at the option of the holder. The units would be identical to the Private Placement Units. As of June 30, 2021 and December 31,
2020, the Company had no outstanding borrowings under the Working Capital Loans.
FINTECH
ACQUISITION CORP. V
NOTES
TO CONDENSED FINANCIAL STATEMENTS
JUNE
30, 2021
(Unaudited)
Note
6 — Commitments and Contingencies
Risks
and Uncertainties
Management
continues to evaluate the impact of the COVID-19 pandemic and has concluded that while it is reasonably possible that the virus could
have a negative effect on the Company’s financial position, results of its operations and/or the close of an initial business combination,
the specific impact is not readily determinable as of the date of these condensed financial statements. The condensed financial statements
do not include any adjustments that might result from the outcome of this uncertainty.
Registration
Rights
Pursuant
to a registration rights agreement entered into on December 3, 2020, the holders of the Founder Shares, Private Placement Units (including
securities contained therein) and the units that may be issued upon conversion of the Working Capital Loans (and any shares of Class A
common stock issuable upon the exercise of the Private Placement Warrants or the warrants included in the units issued upon conversion
of the Working Capital Loans) will be entitled to registration rights, requiring the Company to register such securities for resale (in
the case of the Founder Shares, only after conversion to our Class A common stock). The holders of the majority of these securities
are entitled to make up to three demands, excluding short form demands, that the Company register such securities. In addition, the holders
have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion
of a Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the
Securities Act. The registration rights agreement does not contain liquidated damages or other cash settlement provisions resulting from
delays in registering our securities. The Company will bear the expenses incurred in connection with the filing of any such registration
statements.
Underwriting
Agreement
Cantor
Fitzgerald & Co., as representative of the several underwriters, is entitled to a deferred fee of (i) 4.0% of the gross proceeds
of the initial 21,800,000 Units sold in the Initial Public Offering, or $8,720,000, and (ii) 6% of the gross proceeds from the Units
sold pursuant to the over-allotment option, or $1,920,000. The deferred fee will become payable to the representative from the amounts
held in the Trust Account solely in the event that the Company completes a Business Combination, subject to the terms of the underwriting
agreement.
Merger
Agreement
On March 16, 2021, the Company entered into an
Agreement and Plan of Merger (the “Merger Agreement”) with eToro Group Ltd., a company organized under the laws of the British
Virgin Islands (“eToro”), Buttonwood Merger Sub Corp., a Delaware corporation and a direct, wholly-owned subsidiary of eToro
(“Merger Sub”), and the Company, which provides for, among other things, the merger of Merger Sub with and into the Company
(the “Merger”), with the Company surviving as a wholly-owned subsidiary of eToro (the “Business Combination”).
At the closing of the Business Combination and the effective time of the Merger (the “Effective Time”), the stockholders of
the Company will receive certain of the common stock, no par value, of eToro (“eToro Common Stock”), and eToro will list as
a publicly traded company on Nasdaq and will continue to conduct the social trading platform business conducted by eToro prior to the
Business Combination.
The
Merger Agreement contains customary representations, warranties and covenants by the parties thereto and the closing is subject to certain
conditions as further described in the Merger Agreement.
FINTECH
ACQUISITION CORP. V
NOTES
TO CONDENSED FINANCIAL STATEMENTS
JUNE
30, 2021
(Unaudited)
Note
7 — Stockholders’ Equity
Preferred Stock — On
October 13, 2020, the Company filed an amendment to its certificate of incorporation, pursuant to which it is authorized to issue 1,000,000
shares of preferred stock with a par value of $0.0001 per share with such designation, rights and preferences as may be determined from
time to time by the Company’s Board of Directors. At June 30, 2021 and December 31, 2020, there were no shares of preferred stock
issued or outstanding.
Class A Common Stock —
On October 13, 2020, the Company filed an amendment to its certificate of incorporation, pursuant to which it is authorized to issue 100,000,000
shares of Class A common stock with a par value of $0.0001 per share. Holders of Class A common stock are entitled to one vote
for each share. At June 30, 2021, there were 5,035,344 shares of Class A common stock issued and outstanding, excluding 20,604,656
shares of Class A common stock subject to possible redemption. At December 31, 2020, there were 3,784,701 shares of Class A common
stock issued and outstanding, excluding 21,855,299 shares of Class A common stock subject to possible redemption.
Class B Common Stock —
On October 13, 2020, the Company filed an amendment to its Certificate of Incorporation, pursuant to which it is authorized to issue 10,000,000
shares of Class B common stock with a par value of $0.0001 per share. Holders of the Company’s Class B common stock are
entitled to one vote for each share. At June 30, 2021 and December 31, 2020, there were 8,546,667 shares of Class B common stock issued
and outstanding.
Holders
of Class B common stock will vote on the election of directors prior to the consummation of a Business Combination. Holders of Class A
common stock and Class B common stock will vote together as a single class on all other matters submitted to a vote of stockholders
except as required by law.
The
shares of Class B common stock will automatically convert into shares of Class A common stock at the time of a Business Combination
on a one-for-one basis, subject to adjustment. In the case that additional shares of Class A common stock or equity-linked securities
are issued or deemed issued in excess of the amounts offered in the Initial Public Offering and related to the closing of a Business
Combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted
(unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such adjustment with respect
to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares
of Class B common stock will equal, in the aggregate, on an as-converted basis, 25% of the sum of the total number of all shares
of common stock issued and outstanding upon completion of the Initial Public Offering, including Private Placement Shares, plus all shares
of Class A common stock and equity-linked securities issued or deemed issued in connection with a Business Combination (excluding
any shares or equity-linked securities issued, or to be issued, to any seller in a Business Combination). Holders of Founder Shares may
also elect to convert their shares of Class B common stock into an equal number of shares of Class A common stock, subject
to adjustment as provided above, at any time.
Note
8 – Warrants Liabilities
Warrants —
Public Warrants may only be exercised for a whole number of shares. No fractional shares will be issued upon exercise of the Public Warrants.
The Public Warrants will become exercisable on the later of (a) 30 days after the completion of a Business Combination or (b) 12
months from the closing of the Initial Public Offering; provided in each case that the Company has an effective registration statement
under the Securities Act covering the shares of common stock issuable upon exercise of the Public Warrants and a current prospectus relating
to them is available. At June 30, 2021 and December 31, 2020, there were 8,546,667 warrants outstanding (8,333,334 Public Warrants and
213,333 Private Placement Warrants).
The
Company will not be obligated to deliver any Class A common stock pursuant to the exercise of a Public Warrant and will have no
obligation to settle such Public Warrant exercise unless a registration statement under the Securities Act with respect to the shares
of Class A common stock underlying the Public Warrants is then effective and a current prospectus relating thereto is available,
subject to the Company satisfying its obligations with respect to registration. No Public Warrant will be exercisable for cash or on
a cashless basis, and the Company will not be obligated to issue any shares to holders seeking to exercise their Public Warrants, unless
the issuance of the shares upon such exercise is registered, qualified or deemed exempt under the securities laws of the state of the
exercising holder.
The
Company has agreed that as soon as practicable, but in no event later than 20 business days, after the closing of a Business Combination,
it will use its best efforts to file with the SEC a registration statement covering the issuance, under the Securities Act, of the Class A
common stock issuable upon exercise of the Public Warrants. The Company will use its best efforts to cause the same to become effective
within 60 business days after the closing of the Business Combination and to maintain the effectiveness of such registration statement,
and a current prospectus relating thereto, until the expiration of the Public Warrants in accordance with the provisions of the warrant
agreement. Notwithstanding the above, if the Class A common stock are, at the time of any exercise of a Public Warrant, not listed
on a national securities exchange such that they satisfy the definition of a “covered security” under Section 18(b)(1)
of the Securities Act, the Company may, at its option, require holders of Public Warrants who exercise their Public Warrants to do so
on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event the Company so elects,
the Company will not be required to file or maintain in effect a registration statement, but will use its best efforts to qualify the
shares under applicable blue sky laws to the extent an exemption is not available.
FINTECH
ACQUISITION CORP. V
NOTES
TO CONDENSED FINANCIAL STATEMENTS
JUNE
30, 2021
(Unaudited)
Redemption
of warrants for Cash. Once the Public Warrants become exercisable, the Company may redeem the Public Warrants:
|
●
|
in whole and not in part;
|
|
|
|
|
●
|
at a price of $0.01 per warrant;
|
|
|
|
|
●
|
upon not less than 30 days’ prior written notice of redemption to each warrant holder; and
|
|
|
|
|
●
|
if, and only if, the reported last sale price of the Company’s Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending three business days prior to the date on which the Company sends the notice of redemption to the warrant holders.
|
If
and when the warrants become redeemable by the Company, the Company may exercise its redemption right even if it is unable to register
or qualify the underlying securities for sale under all applicable state securities laws.
If
the Company calls the Public Warrants for redemption for cash, management will have the option to require all holders that wish to exercise
the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number
of shares of Class A common stock issuable upon exercise of the warrants may be adjusted in certain circumstances including in the
event of a stock dividend, or recapitalization, reorganization, merger or consolidation. Additionally, in no event will the Company be
required to net cash settle the warrants.
In
addition, if (x) the Company issues additional Class A common stock or equity-linked securities for capital raising purposes
in connection with the closing of a Business Combination at an issue price or effective issue price of less than $9.20 per Class A
common stock (with such issue price or effective issue price to be determined in good faith by the Company and, in the case of any such
issuance to the Sponsor or its affiliates, without taking into account any Founder Shares held by the initial stockholders or such affiliates,
as applicable, prior to such issuance) (the “Newly Issued Price”), (y) the aggregate gross proceeds from such issuances
represent more than 50% of the total equity proceeds, and interest thereon, available for the funding of a Business Combination on the
date of the consummation of a Business Combination (net of redemptions), and (z) the volume weighted average trading price of its
Class A common stock during the 20 trading day period starting on the trading day prior to the day on which the Company consummates
its Business Combination (such price, the “Market Value”) is below $9.20 per share, the exercise price of the warrants will
be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per
share redemption trigger price will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly
Issued Price.
The Private Placement Warrants are identical to
the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Placement Warrants and the Class A
common stock issuable upon the exercise of the Private Placement Warrants will not be transferable, assignable or salable until 30 days
after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will
be non-redeemable so long as they are held by the Sponsor or its permitted transferees. If the Private Placement Warrants are held by
someone other than the Sponsor or its permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable
by such holders on the same basis as the Public Warrants.
FINTECH
ACQUISITION CORP. V
NOTES
TO CONDENSED FINANCIAL STATEMENTS
JUNE
30, 2021
(Unaudited)
Note
9 — Fair Value Measurements
At
June 30, 2021 and December 31, 2020, assets held in the Trust Account were comprised of $250,013,974 and $250,001,576, respectively,
in money market funds which are invested primarily in U.S. Treasury Securities.
The
Company classifies its U.S. Treasury and equivalent securities as held-to-maturity in accordance with ASC Topic 320
“Investments - Debt and Equity Securities.” Held-to-maturity securities are those securities which the Company has the
ability and intent to hold until maturity. Held-to-maturity treasury securities are recorded at amortized cost on the accompanying
condensed balance sheets and adjusted for the amortization or accretion of premiums or discounts.
The
fair value of the Company’s assets and liabilities that are re-measured and reported at fair value at each reporting period, and
non-financial assets and liabilities that are re-measured and reported at fair value at least annually are reported under ASC Topic 820,
“Fair Value Measurement.”
The
fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would
have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction
between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company
seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable
inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is
used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and
liabilities:
Level
1:
|
Quoted
prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions
for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.
|
Level
2:
|
Observable
inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities
and quoted prices for identical assets or liabilities in markets that are not active.
|
Level
3:
|
Unobservable
inputs based on the Company’s assessment of the assumptions that market participants would use in pricing the asset or liability.
|
The
following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring
basis at June 30, 2021 and December 31, 2020 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine
such fair value:
Description
|
|
Level
|
|
|
June 30,
2021
|
|
|
December 31,
2020
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
Marketable securities held in Trust Account – U.S. Treasury Securities Money Market Fund
|
|
|
1
|
|
|
$
|
250,013,974
|
|
|
$
|
250,001,576
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Warrant liabilities – Public Warrants
|
|
|
1
|
|
|
$
|
26,500,002
|
|
|
$
|
-
|
|
Warrant liabilities – Public Warrants
|
|
|
3
|
|
|
$
|
-
|
|
|
$
|
16,833,335
|
|
Warrant liabilities – Private Placement Warrants
|
|
|
3
|
|
|
$
|
898,132
|
|
|
$
|
471,466
|
|
The
Warrants were accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities on the Company’s
condensed balance sheets. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair
value presented within change in fair value of warrant liabilities in the condensed statement of operations.
The Private Placement Warrants were valued using
a Modified Black Scholes Option Pricing Model. The Private Placement Warrants are considered to be a Level 3 fair value measurement due
to the use of unobservable inputs. The Modified Black Scholes Option Pricing Model’s primary unobservable input utilized in determining
the fair value of the Private Placement Warrants is the expected volatility of the common stock as well as the probability of consummation
of a Business Combination. The probability assigned to the consummation of the Business Combination was 80% as of December 31, 2020 and
90% as of June 30, 2021, which was determined based on the observed success rates of business combinations for special purpose acquisition
companies. The expected volatility as of the Initial Public Offering date was derived from observable public warrant pricing on comparable
‘blank-check’ companies without an identified target. The expected volatility as of subsequent valuation dates will be implied
from the Company’s own public warrant pricing. A Monte Carlo simulation methodology was used in estimating the fair value of the
Public Warrants for periods where no observable traded price was available, using the same expected volatility as was used in measuring
the fair value of the Private Placement Warrants. For periods subsequent to the detachment of the warrants from the Units, including June
30, 2021, the closing price of the Public Warrants was used as the fair value as of each relevant date.
FINTECH
ACQUISITION CORP. V
NOTES
TO CONDENSED FINANCIAL STATEMENTS
JUNE
30, 2021
(Unaudited)
The
key inputs into the model for the Private Placement Warrants and the Public Warrants were as follows at December 31, 2020 and for the
Private Placement Warrants at June 30, 2021:
Input
|
|
December 31,
2020
|
|
|
June 30,
2021
|
|
Stock price
|
|
$
|
10.00
|
|
|
$
|
11.19
|
|
Strike price
|
|
$
|
11.50
|
|
|
$
|
11.50
|
|
Term (in years)
|
|
|
5.4
|
|
|
|
5.1
|
|
Volatility
|
|
|
35.0
|
%
|
|
|
40.0
|
%
|
Risk-free rate
|
|
|
0.4
|
%
|
|
|
0.9
|
%
|
Dividend yield
|
|
|
0.0
|
%
|
|
|
0.0
|
%
|
The following table presents the changes in the
fair value of Level 3 warrant liabilities:
|
|
|
|
Fair value of derivative warrant liabilities as of December 31, 2020
|
|
$
|
17,304,801
|
|
Change in fair value of derivative warrant liabilities
|
|
|
3,422,667
|
|
Transfer to Level 1
|
|
|
(20,000,002
|
)
|
Fair value of derivative warrant liabilities as of March 31, 2021
|
|
$
|
727,468
|
|
Change in fair value of derivative warrant liabilities
|
|
|
170,666
|
|
Fair value of derivative warrant liabilities as of June 30, 2021
|
|
$
|
898,134
|
|
Transfers
to/from Levels 1, 2 and 3 are recognized at the end of the reporting period. There were no transfers between levels for the three and
six months ended June 30, 2021 other than the transfer of the Public Warrants from Level 3 to Level 1 following the detachment of the
Public Warrants from the Units on January 25, 2021.
Note
10 — Subsequent Events
The
Company evaluated subsequent events and transactions that occurred after the condensed balance sheet date up to the date that the
condensed financial statements were issued. Based upon this review, the Company did not identify any subsequent events that would
have required adjustment or disclosure in the condensed financial statements.