The accompanying notes are an integral part of
these condensed financial statements.
The accompanying notes are an integral part of
these unaudited condensed financial statements.
The accompanying notes are an integral part of
these unaudited condensed financial statements.
The accompanying notes are an integral part of
these unaudited condensed financial statements.
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 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 March 31, 2021, the Company had not commenced operations. All
activity through March 31, 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, 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
MARCH 31, 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 of 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
MARCH 31, 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.
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
months ended March 31, 2021 are not necessarily indicative of the results to be expected for the year ending December 31, 2021 or for
any future interim periods.
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 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 financial statements, which management considered in formulating its estimate, could change in the near
term due to one or more future events. Accordingly, the actual results could differ significantly from those estimates. One of the more
significant accounting estimates included in these financial statements is the determination of the fair value of the warrant liabilities.
FINTECH ACQUISITION CORP. V
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 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 March 31, 2021 and
December 31, 2020.
Marketable Securities Held in Trust Account
At March 31, 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 accounts for the Warrants in accordance
with the guidance contained in Accounting Standards Codification (“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 adjust 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 our 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 Shares Subject to Possible Redemption
The Company accounts for its Class A common stock
subject to possible redemption in accordance with the guidance in ASC Topic 480 “Distinguishing Liabilities from Equity.”
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 March 31, 2021 and December 31, 2020, 21,358,908 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 balance sheet.
Offering Costs
Offering costs consist of underwriting, legal, accounting and other
expenses incurred through the Initial Public Offering that are 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 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,” 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 March 31, 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
MARCH 31, 2021
(Unaudited)
Net Income (Loss) Per Common Share
The Company complies with 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 shares 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 are exercisable to purchase 8,456,667 shares of Class A common stock
in the aggregate.
The Company’s statement of operations includes a presentation
of loss per share for common shares 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 shares is calculated by dividing the interest income earned
on the Trust Account, by the weighted average number of Class A redeemable common shares outstanding since original issuance. Net loss
per common share, basic and diluted, for Class A and Class B non-redeemable common shares is calculated by dividing the net loss, adjusted
for income attributable to Class A redeemable common shares, by the weighted average number of Class A and Class B non-redeemable common
shares 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):
|
|
For the Three Months Ended
March
31, 2021
|
|
Redeemable Class A Common Shares
|
|
|
|
|
Numerator: Earnings allocable to Redeemable Class A Common Shares
|
|
|
|
|
Interest Income
|
|
$
|
6,165
|
|
Net Earnings
|
|
$
|
6,165
|
|
Denominator: Weighted Average Redeemable Class A Common Shares
|
|
|
|
|
Redeemable Class A Common Shares, Basic and Diluted
|
|
|
25,000,000
|
|
Earnings/Basic and Diluted Redeemable Class A Common Shares
|
|
$
|
-
|
|
|
|
|
|
|
Non-Redeemable Class A and B Common Shares
|
|
|
|
|
Numerator: Net Loss minus Redeemable Net Earnings
|
|
|
|
|
Net Loss
|
|
$
|
(4,963,910
|
)
|
Redeemable Net Earnings
|
|
$
|
6,165
|
|
Non-Redeemable Net Loss
|
|
$
|
(4,957,745
|
)
|
Denominator: Weighted Average Non-Redeemable Class A and B Common Shares
|
|
|
|
|
Non-Redeemable Class B Common Stock, Basic and Diluted (1)
|
|
|
9,186,667
|
|
Loss/Basic and Diluted Non-Redeemable Class A and B Common Shares
|
|
$
|
(0.54
|
)
|
(1)
|
The weighted average non-redeemable common stock at March 31, 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
MARCH 31, 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,” approximates the carrying
amounts represented in the Company’s condensed balance sheet, primarily due to their short-term nature. As of March 31, 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 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.
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.
FINTECH ACQUISITION CORP. V
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2021
(Unaudited)
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 months ended March 31, 2021, the Company
incurred and paid $60,000 for administrative services.
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 March 31, 2021 and December 31, 2020, the Company had no outstanding borrowings under the Working Capital
Loans.
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 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, we 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 shares, no par value, of eToro (“eToro Common Shares”), 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
MARCH 31, 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 March 31, 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 March 31, 2021, there were 4,281,092 shares of Class A common stock issued and outstanding, excluding 21,358,908 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 common share. At March 31, 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
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 March
31, 2021 and December 31, 2020, there were 8,546,666 warrants outstanding (8,333,333 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
MARCH 31, 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 shares
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
MARCH 31, 2021
(Unaudited)
Note 9 — Fair Value Measurements
At March 31, 2021 and December 31, 2020, assets
held in the Trust Account were comprised of $250,007,741 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 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 our 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 March 31, 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
|
|
|
March 31,
2021
|
|
|
December 31,
2020
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
Marketable securities held in Trust Account – U.S. Treasury Securities Money Market Fund
|
|
|
1
|
|
|
$
|
250,007,741
|
|
|
|
250,001,576
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Warrant liabilities – Public Warrants
|
|
|
1
|
|
|
$
|
20,000,002
|
|
|
|
|
|
Warrant liabilities – Public Warrants
|
|
|
3
|
|
|
|
|
|
|
|
16,833,335
|
|
Warrant liabilities – Private Placement Warrants
|
|
|
3
|
|
|
$
|
727,466
|
|
|
|
471,466
|
|
The Warrants were accounted for as liabilities in
accordance with ASC 815-40 and are presented within warrant liabilities on our condensed balance sheet. 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 initially valued
using a Modified Black Scholes Option Pricing Model. The Private Placement Warrants are considered to be a Level 3 fair value measurements
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 shares 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 March 31, 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 March 31, 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
MARCH 31, 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 March 31, 2021:
Input
|
|
December 31,
2020
|
|
|
March 31,
2021
|
|
Stock price
|
|
$
|
10.00
|
|
|
$
|
11.21
|
|
Strike price
|
|
$
|
11.50
|
|
|
$
|
11.50
|
|
Term (in years)
|
|
|
5.4
|
|
|
|
5.4
|
|
Volatility
|
|
|
35.0
|
%
|
|
|
36.6
|
%
|
Risk-free rate
|
|
|
0.4
|
%
|
|
|
1.0
|
%
|
Dividend yield
|
|
|
0.0
|
%
|
|
|
0.0
|
%
|
The following table presents the changes
in the fair value of warrant liabilities:
|
|
Placement
|
|
|
Public
|
|
|
Warrant Liabilities
|
|
Fair value of derivative warrant liabilities as of December 31, 2020
|
|
$
|
471,466
|
|
|
$
|
16,833,335
|
|
|
$
|
17,304,801
|
|
Change in fair value of derivative warrant liabilities
|
|
|
256,000
|
|
|
|
3,166,667
|
|
|
|
3,422,667
|
|
Fair value of derivative warrant liabilities as of March 31, 2021
|
|
$
|
727,466
|
|
|
$
|
20,000,002
|
|
|
$
|
20,727,468
|
|
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 months ended March 31, 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 balance sheet date up to the date that the unaudited 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 unaudited condensed
financial statements.