Item
1. Business
Introduction
We are an early-stage blank check company
recently formed as a Delaware corporation for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock
purchase, reorganization or similar business combination with one or more businesses. Throughout this Report we will refer to this
as our initial business combination. While our efforts to identify a target business may span many industries and regions worldwide,
we intend to focus our search for prospects within the software and internet technology industries. Our ability to locate a potential
target is subject to the uncertainties discussed elsewhere in this Report.
Our Mission
Our purpose is to complete a business combination
with a leading software or internet company that is valued between $650 million and $2 billion. We seek to effectively employ our
management team’s industry skills and experience as well as their extensive personal network to add substantial value to
any acquired company. These benefits include the following:
Expertise in growing successful software
and internet companies: Our management team has demonstrated consistent prowess in building, investing,
nurturing and leading software and internet companies. We believe they can spot unique ideas or disruptive business models and
grow them from local sensation to global ubiquity. We believe we can also recruit top talent and use that intellectual capital
to great competitive advantage;
Ability to mentor and support exceptional
executives: Our Co-Chief Executive Officers, directors and advisors have served on more than 30 public
and 100 private boards of directors in North America, Europe and Asia, both within and outside the software and internet sectors.
They have overseen more than 200 acquisitions, taken companies public, thrived amid complex governance dilemmas and enhanced their
companies’ global growth;
Maximizing the value of becoming a publicly
traded entity: As a public entity, we believe we offer a wide range of advantages to stakeholders. These
include but are not limited to: working with management and shareholders who aspire to have their company become a public entity
and generate substantial wealth creation; transitioning from a private to a public entity may include broader access to debt and
equity providers; provision of liquidity for employees and potential acquisitions; and expansion of branding in the marketplace.
Acquisition Criteria
Our intent is to seek potential target companies
globally. We intend to accomplish this using a broad and global network of professional contacts that has been developed by our
management team and advisors over many years. This network encompasses private equity firms, venture capitalists and entrepreneurs.
The maturity and judgment skills accumulated
by our management team and advisors will guide our acquisition process. When candidate companies are being evaluated, we use the
following, non-exclusive criteria listed below for determining opportunities.
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Size: We intend to target entities whose enterprise value is between $650 million and $2
billion. These companies have an international following, and we believe offer long-term risk-adjusted return potential;
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Focus: The software industry and internet sector are domains in which we have an
accomplished track record and “pattern recognition” knowledge. Our management team and advisors’
multifaceted expertise in assessing a target’s technology and their potential for disruption are key in evaluating
business transaction candidates swiftly and adequately;
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Management’s maturity: We intend to seek companies with proven and accomplished
management teams which are eager to march forward together with and benefit from our management team’s expertise. We
intend to devote significant resources to analyzing and reaching alignment among a target’s management and its
stakeholders, a paramount element to successful execution of any business plan;
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Operational maturity: We intend to select companies which have the requisite compliance,
financial controls and reporting processes in place and are ready for the regulatory constraints of a public entity;
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Growth: We intend to invest in software or internet companies that are on what we believe
to be a promising growth path, driven by a sustainable competitive advantage, resulting in strong unit economics;
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Strategic Initiatives: We intend to seek management teams with the interest and ability
to execute on strategic opportunities, including acquisitions of companies that enhances shareholder value;
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Benefit from being public: We are committed to working with management and shareholders
who aspire to have their company become a public entity and generate substantial wealth creation. The benefits of
transitioning from a private to a public entity may include a broader access to debt and equity providers, liquidity for
employees and potential acquisitions, and expanded branding in the marketplace;
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Reputation and market acceptance: We intend to seek companies with a sizable market share
in their segment and the opportunity to achieve market leadership. They should also have defensible proprietary technology
and intellectual property rights;
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Appropriate valuations: We are rigorous, disciplined, and valuation-centric investors,
with a keen understanding of market value. We expect to enter into a business combination only if it pairs significant upside
potential with limited downside risks.
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These criteria are not intended to be exhaustive.
Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these
general guidelines as well as other considerations, factors and criteria that our management team may deem relevant. In the event
that we decide to enter into our initial business combination with a target business that does not meet the above criteria and
guidelines, we will disclose that the target business does not meet the above criteria in our stockholder communications related
to our initial business combination, which, as discussed in this Report, would be in the form of proxy solicitation materials or
tender offer documents that we would file with the U.S. Securities and Exchange Commission.
We may need to obtain additional financing
either to complete our initial business combination or because we become obligated to redeem a significant number of our public
shares upon completion of our initial business combination. We intend to acquire a company with an enterprise value significantly
above the net proceeds of our initial public offering and the sale of the placement units. Depending on the size of the transaction
or the number of public shares we become obligated to redeem, we may potentially utilize several additional financing sources,
including but not limited to the issuance of additional securities to the sellers of a target business, debt issued by banks or
other lenders or the owners of the target, a private placement to raise additional funds, or a combination of the foregoing. If
we are unable to complete our initial business combination because we do not have sufficient funds available to us, we will be
forced to cease operations and liquidate the trust account. In addition, following our initial business combination, if cash on
hand is insufficient to meet our obligations or our working capital needs, we may need to obtain additional financing.
Initial Business Combination
NASDAQ rules require that we must complete
one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the
trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at
the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will
make the determination as to the fair market value of our initial business combination. If our board of directors is not able to
independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent
investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction
of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination
of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with
the business of a particular target or if there is a significant amount of uncertainty as to the value of a target’s assets
or prospects.
We anticipate structuring our initial business
combination either (i) in such a way so that the post-transaction company in which our public stockholders own shares will own
or acquire 100% of the equity interests or assets of the target business or businesses, or (ii) in such a way so that the post-transaction
company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives
of the target management team or stockholders, or for other reasons. However, we will only complete an initial business combination
if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires
a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment
Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders
prior to the initial business combination may collectively own a minority interest in the post-transaction company, depending on
valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which
we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we
would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares,
our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares
subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses
are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is
what will be taken into account for purposes of NASDAQ’s 80% fair market value test. If the initial business combination
involves more than one target business, the 80% fair market value test will be based on the aggregate value of all of the transactions
and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking
stockholder approval, as applicable.
Our Business Combination Process
In evaluating prospective business combinations,
we have conducted and will continue to conduct a thorough due diligence review process that will encompass, among other things,
a review of historical and projected financial and operating data, meetings with management and their advisors (if applicable),
on-site inspection of facilities and assets, discussion with customers and suppliers, legal reviews and other reviews as we deem
appropriate.
We are not prohibited from pursuing an initial
business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete
our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee
of independent directors, will obtain an opinion from an independent investment banking firm or another independent entity that
commonly renders valuation opinions that our initial business combination is fair to our company from a financial point of view.
Each of our officers and directors may have
a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such
officers and directors were to be included by a target business as a condition to any agreement with respect to our initial business
combination.
Certain of our
officers and directors presently have fiduciary or contractual obligations to other entities pursuant to which such officer
or director is or will be required to present a business combination opportunity. Accordingly, if any of our officers or
directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has
then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to
present such opportunity to such entity. We believe, however, that the fiduciary duties or contractual obligations of our
officers or directors will not materially affect our ability to complete our initial business combination. Our amended and
restated certificate of incorporation provides that we renounce our interest in any corporate opportunity offered to any
director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director
or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would
otherwise be reasonable for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to
us without violating another legal obligation.
Our officers have agreed not to become an
officer or director of any other special purpose acquisition company with a class of securities registered under the Securities
Exchange Act of 1934, as amended, or the Exchange Act, until we have entered into a definitive agreement regarding our initial
business combination or we have liquidated the trust account.
Our Management Team
Members of our management team are not obligated
to devote any specific number of hours to our matters but they devote as much of their time as they, in the exercise of their respective
business judgement, deem necessary to our affairs and intend to continue doing so until we have completed our initial business
combination. The amount of time that any member of our management team devotes in any time period may vary based on whether a target
business has been selected for our initial business combination and the current stage of the business combination process. We do
not have an employment agreement with any member of our management team.
We believe our management team’s operating
and transaction experience and relationships with companies provides us with a substantial number of potential business combination
targets. Over the course of their careers, the members of our management team have developed a broad network of contacts and corporate
relationships in the software and internet technology industry. This network has grown through the activities of our management
team sourcing, acquiring and financing businesses, our management team’s relationships with sellers, financing sources and
target management teams and the experience of our management team in executing transactions under varying economic and financial
market conditions.
Initial Business Combination
NASDAQ rules require that we must complete
one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the
trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at
the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will
make the determination as to the fair market value of our initial business combination. If our board of directors is not able to
independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent
investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction
of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination
of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with
the business of a particular target or if there is a significant amount of uncertainty as to the value of a target’s assets
or prospects.
Status as a Public Company
We believe our structure makes us an attractive business combination
partner to target businesses. As a public company, we offer a target business an alternative to the traditional initial public
offering through a merger or other business combination with us. Following an initial business combination, we believe the target
business would have greater access to capital and additional means of creating management incentives that are better aligned with
stockholders’ interests than it would as a private company. A target business can further benefit by augmenting its profile
among potential new customers and vendors and aid in attracting talented employees. In a business combination transaction with
us, the owners of the target business may, for example, exchange their shares of stock in the target business for our shares of
Class A common stock (or shares of a new holding company) or for a combination of our shares of Class A common stock and cash,
allowing us to tailor the consideration to the specific needs of the sellers.
Although there are various costs and obligations
associated with being a public company, we believe target businesses will find this method a more expeditious and cost effective
method to becoming a public company than the typical initial public offering. The typical initial public offering process takes
a significantly longer period of time than the typical business combination transaction process, and there are significant expenses
in the initial public offering process, including underwriting discounts and commissions, marketing and road show efforts that
may not be present to the same extent in connection with an initial business combination with us.
Furthermore, once a proposed initial business
combination is completed, the target business will have effectively become public, whereas an initial public offering is always
subject to the underwriters’ ability to complete the offering, as well as general market conditions, which could delay or
prevent the offering from occurring or could have negative valuation consequences. Following an initial business combination, we
believe the target business would then have greater access to capital and an additional means of providing management incentives
consistent with stockholders’ interests and the ability to use its shares as currency for acquisitions. Being a public company
can offer further benefits by augmenting a company’s profile among potential new customers and vendors and aid in attracting
talented employees.
While we believe that our structure and our
management team’s backgrounds make us an attractive business partner, some potential target businesses may view our status
as a blank check company, such as our lack of an operating history and our ability to seek stockholder approval of any proposed
initial business combination, negatively.
We are an “emerging growth company,”
as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act. As such, we are eligible to take advantage of certain
exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth
companies” including, but not limited to, not being required to comply with the independent registered public accounting
firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation
in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive
compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities
less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may
be more volatile.
In addition, Section 107 of the JOBS Act
also provides that an “emerging growth company” can take advantage of the extended transition period provided in Section
7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an “emerging growth
company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.
We intend to take advantage of the benefits of this extended transition period.
We will remain an emerging growth company
until the earlier of (1) the last day of the fiscal year (a) following September 19, 2024, (b) in which we have total annual gross
revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value
of our Class A common stock that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the
date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period.
Financial Position
With funds available in our trust account
for an initial business combination in the amount of $338,659,163 (as of December 31, 2019), after payment of $13,150,000 of deferred
underwriting fees, before fees and expenses associated with our initial business combination, we offer a target business a variety
of options such as creating a liquidity event for its owners, providing capital for the potential growth and expansion of its operations
or strengthening its balance sheet by reducing its debt or leverage ratio. Because we are able to complete our initial business
combination using our cash, debt or equity securities, or a combination of the foregoing, we have the flexibility to use the most
efficient combination that will allow us to tailor the consideration to be paid to the target business to fit its needs and desires.
However, we have not taken any steps to secure third party financing and there can be no assurance it will be available to us.
Effecting Our Initial Business Combination
We are not presently engaged in, and we will
not engage in, any operations for an indefinite period of time. We intend to effectuate our initial business combination using
cash from the proceeds of our initial public offering and the private placement of the placement units, the proceeds of the sale
of our shares in connection with our initial business combination (pursuant to backstop agreements we may enter into or otherwise),
shares issued to the owners of the target, debt issued to bank or other lenders or the owners of the target, or a combination of
the foregoing. We may seek to complete our initial business combination with a company or business that may be financially unstable
or in its early stages of development or growth, which would subject us to the numerous risks inherent in such companies and businesses.
If our initial business combination is paid
for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration
in connection with our initial business combination or used for redemptions of our Class A common stock, we may apply the balance
of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations
of the post-transaction company, the payment of principal or interest due on indebtedness incurred in completing our initial business
combination, to fund the purchase of other companies or for working capital.
We may seek to raise additional funds through
a private offering of debt or equity securities in connection with the completion of our initial business combination, and we may
effectuate our initial business combination using the proceeds of such offering rather than using the amounts held in the trust
account. In addition, we intend to target businesses larger than we could acquire with the net proceeds of our initial public offering
and the sale of the placement units, and may as a result be required to seek additional financing to complete such proposed initial
business combination. Subject to compliance with applicable securities laws, we would expect to complete such financing only simultaneously
with the completion of our initial business combination. In the case of an initial business combination funded with assets other
than the trust account assets, our proxy materials or tender offer documents disclosing the initial business combination would
disclose the terms of the financing and, only if required by law, we would seek stockholder approval of such financing. There are
no prohibitions on our ability to raise funds privately, or through loans in connection with our initial business combination.
Sources of Target Businesses
Target business candidates are brought to our attention from
various unaffiliated sources, including investment bankers and investment professionals. Target businesses are brought to our attention
by such unaffiliated sources as a result of being solicited by us by calls or mailings. These sources also introduce us to target
businesses in which they think we may be interested on an unsolicited basis, since many of these sources will have read our public
filings and know what types of businesses we are targeting. Our officers and directors, as well as our sponsor and their affiliates,
also bring to our attention target business candidates that they become aware of through their business contacts as a result of
formal or informal inquiries or discussions they may have, as well as attending trade shows or conventions. In addition, we receive
a number of proprietary deal flow opportunities that would not otherwise necessarily be available to us as a result of the business
relationships of our officers and directors and our sponsor and their affiliates. We may engage the services of professional firms
or other individuals that specialize in business acquisitions in the future, in which event we may pay a finder’s fee, consulting
fee, advisory fee or other compensation to be determined in an arm’s length negotiation based on the terms of the transaction.
We will engage a finder only to the extent our management determines that the use of a finder may bring opportunities to us that
may not otherwise be available to us or if finders approach us on an unsolicited basis with a potential transaction that our management
determines is in our best interest to pursue. Payment of finders’ fees is customarily tied to completion of a transaction,
in which case any such fee will be paid out of the funds held in the trust account. In no event, however, will our sponsor or any
of our existing officers, directors or advisors be paid any finder’s fee, reimbursement, consulting fee, monies in respect
of any payment of a loan or other compensation by the company prior to, or in connection with any services rendered for any services
they render in order to effectuate, the completion of our initial business combination (regardless of the type of transaction that
it is). None of our sponsor, executive officers, directors or advisors, or any of their respective affiliates, will be allowed
to receive any compensation, finder’s fees or consulting fees from a prospective business combination target in connection
with a contemplated initial business combination except as set forth herein.
We pay an affiliate of our sponsor a total
of $15,000 per month for office space, utilities and secretarial and administrative support and to reimburse our sponsor and our
officers, directors and advisors for any out-of-pocket expenses related to identifying, investigating and completing an initial
business combination. Some of our officers and directors may enter into employment or consulting agreements with the post-transaction
company following our initial business combination. The presence or absence of any such fees or arrangements will not be used as
a criterion in our selection process of an initial business combination candidate.
We are not prohibited from pursuing an initial
business combination with a target that is affiliated with our sponsor, officers or directors or making the initial business combination
through a joint venture or other form of shared ownership with our sponsor, officers or directors. In the event we seek to complete
our initial business combination with a target that is affiliated with our sponsor, officers or directors, we, or a committee of
independent directors, would obtain an opinion from an independent investment banking firm or another independent entity that commonly
renders valuation opinions that such an initial business combination is fair to our company from a financial point of view. We
are not required to obtain such an opinion in any other context.
If any of our officers or directors becomes
aware of an initial business combination opportunity that falls within the line of business of any entity to which he or she has
pre-existing fiduciary or contractual obligations, he or she may be required to present such business combination opportunity to
such entity prior to presenting such business combination opportunity to us. Our officers and directors currently have certain
relevant fiduciary duties or contractual obligations that may take priority over their duties to us.
Selection of a Target Business and Structuring of our Initial
Business Combination
NASDAQ rules require that we must complete
one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the
trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at
the time of our signing a definitive agreement in connection with our initial business combination. The fair market value of our
initial business combination will be determined by our board of directors based upon one or more standards generally accepted by
the financial community, such as discounted cash flow valuation, a valuation based on trading multiples of comparable public businesses
or a valuation based on the financial metrics of M&A transactions of comparable businesses. If our board of directors is not
able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent
investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction
of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination
of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with
the business of a particular target or if there is a significant amount of uncertainty as to the value of a target’s assets
or prospects. We do not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business
combination. Subject to this requirement, our management has virtually unrestricted flexibility in identifying and selecting one
or more prospective target businesses, although we are not permitted to effectuate our initial business combination with another
blank check company or a similar company with nominal operations.
In any case, we will only complete an initial
business combination in which we own or acquire 50% or more of the outstanding voting securities of the target or otherwise acquire
a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment
Company Act. If we own or acquire less than 100% of the equity interests or assets of a target business or businesses, the portion
of such business or businesses that are owned or acquired by the post-transaction company is what will be taken into account for
purposes of NASDAQ’s 80% fair market value test.
To the extent we effect our initial business
combination with a company or business that may be financially unstable or in its early stages of development or growth we may
be affected by numerous risks inherent in such company or business. Although our management will endeavor to evaluate the risks
inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant risk factors.
In evaluating a prospective business target,
we have conducted, and will continue to conduct a thorough due diligence review, which encompasses, among other things, meetings
with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities, as
well as a review of financial and other information that will be made available to us.
The time required to select and evaluate
a target business and to structure and complete our initial business combination, and the costs associated with this process, are
not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation
of a prospective target business with which our initial business combination is not ultimately completed will result in our incurring
losses and will reduce the funds we can use to complete another business combination.
Lack of Business Diversification
For an indefinite period of time after the
completion of our initial business combination, the prospects for our success may depend entirely on the future performance of
a single business. Unlike other entities that have the resources to complete business combinations with multiple entities in one
or several industries, it is probable that we will not have the resources to diversify our operations and mitigate the risks of
being in a single line of business. In addition, we intend to focus our search for an initial business combination in a single
industry. By completing our initial business combination with only a single entity, our lack of diversification may:
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subject us to negative economic, competitive and regulatory
developments, any or all of which may have a substantial adverse impact on the particular industry in which we operate after our
initial business combination, and
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cause us to depend on the marketing and sale of a single
product or limited number of products or services.
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Limited Ability to Evaluate the Target’s Management
Team
Although we closely scrutinize the management
of a prospective target business when evaluating the desirability of effecting our initial business combination with that business,
our assessment of the target business’ management may not prove to be correct. In addition, the future management may not
have the necessary skills, qualifications or abilities to manage a public company. Furthermore, the future role of members of our
management team, if any, in the target business cannot presently be stated with any certainty. The determination as to whether
any of the members of our management team will remain with the combined company will be made at the time of our initial business
combination. While it is possible that one or more of our directors will remain associated in some capacity with us following our
initial business combination, it is unlikely that any of them will devote their full efforts to our affairs subsequent to our initial
business combination. Moreover, we cannot assure you that members of our management team will have significant experience or knowledge
relating to the operations of the particular target business.
We cannot assure you that any of our key
personnel will remain in senior management or advisory positions with the combined company. The determination as to whether any
of our key personnel will remain with the combined company will be made at the time of our initial business combination.
Following an initial business combination,
we may seek to recruit additional managers to supplement the incumbent management of the target business. We cannot assure you
that we will have the ability to recruit additional managers, or that additional managers will have the requisite skills, knowledge
or experience necessary to enhance the incumbent management.
Stockholders May Not Have the Ability to Approve Our Initial
Business Combination
We may conduct redemptions without a stockholder
vote pursuant to the tender offer rules of the SEC. However, we will seek stockholder approval if it is required by law or applicable
stock exchange rule, or we may decide to seek stockholder approval for business or other legal reasons. Presented in the table
below is a graphic explanation of the types of initial business combinations we may consider and whether stockholder approval is
currently required under Delaware law for each such transaction.
Type of Transaction
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Whether Stockholder Approval is Required
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Purchase of assets
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No
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Purchase of stock of target not involving a merger with the company
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No
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Merger of target into a subsidiary of the company
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No
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Merger of the company with a target
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Yes
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Under NASDAQ’s listing rules, stockholder
approval would be required for our initial business combination if, for example:
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we issue shares of Class A common stock that will be equal
to or in excess of 20% of the number of shares of our Class A common stock then outstanding;
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any of our directors, officers or substantial stockholders
(as defined by NASDAQ rules) has a 5% or greater interest (or such persons collectively have a 10% or greater interest), directly
or indirectly, in the target business or assets to be acquired or otherwise and the present or potential issuance of common stock
could result in an increase in outstanding common shares or voting power of 5% or more; or
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the issuance or potential issuance of common stock will
result in our undergoing a change of control.
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Permitted Purchases of our Securities
If we seek stockholder approval of our initial
business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender
offer rules, our sponsor, initial stockholders, directors, officers, advisors or their affiliates may purchase shares or public
warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial
business combination. There is no limit on the number of shares our initial stockholders, directors, officers, advisors or their
affiliates may purchase in such transactions, subject to compliance with applicable law and NASDAQ rules. However, they have no
current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any
such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any
material nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange
Act. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules
under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the
purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply
with such rules. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such
purchasers are subject to such reporting requirements. None of the funds held in the trust account will be used to purchase shares
or public warrants in such transactions prior to completion of our initial business combination.
The purpose of any such purchases of shares could be to vote
such shares in favor of the initial business combination and thereby increase the likelihood of obtaining stockholder approval
of the initial business combination or to satisfy a closing condition in an agreement with a target that requires us to have a
minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement
would otherwise not be met. The purpose of any such purchases of public warrants could be to reduce the number of public warrants
outstanding or to vote such warrants on any matters submitted to the warrantholders for approval in connection with our initial
business combination. Any such purchases of our securities may result in the completion of our initial business combination that
may not otherwise have been possible. In addition, if such purchases are made, the public “float” of our shares of
Class A common stock or warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may
make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange.
Our sponsor, officers, directors and/or their
affiliates anticipate that they may identify the stockholders with whom our sponsor, officers, directors or their affiliates may
pursue privately negotiated purchases by either the stockholders contacting us directly or by our receipt of redemption requests
submitted by stockholders following our mailing of proxy materials in connection with our initial business combination. To the
extent that our sponsor, officers, directors, advisors or their affiliates enter into a private purchase, they would identify and
contact only potential selling stockholders who have expressed their election to redeem their shares for a pro rata share of the
trust account or vote against our initial business combination, whether or not such stockholder has already submitted a proxy with
respect to our initial business combination. Our sponsor, officers, directors, advisors or their affiliates will only purchase
shares if such purchases comply with Regulation M under the Exchange Act and the other federal securities laws.
Any purchases by our sponsor, officers, directors
and/or their affiliates who are affiliated purchasers under Rule 10b-18 under the Exchange Act will only be made to the extent
such purchases are able to be made in compliance with Rule 10b-18, which is a safe harbor from liability for manipulation under
Section 9(a)(2) and Rule 10b-5 of the Exchange Act. Rule 10b-18 has certain technical requirements that must be complied with in
order for the safe harbor to be available to the purchaser. Our sponsor, officers, directors and/or their affiliates will not make
purchases of common stock if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act. Any such purchases
will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchases are subject to such reporting
requirements.
Redemption Rights for Public Stockholders upon Completion
of our Initial Business Combination
We will provide our public stockholders with
the opportunity to redeem all or a portion of their shares of Class A common stock upon the completion of our initial business
combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two
business days prior to the consummation of the initial business combination including interest earned on the funds held in the
trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject
to the limitations described herein. The amount in the trust account as of December 31, 2019 is approximately $10.04 per public
share. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred
underwriting commissions we will pay to the underwriters. Our sponsor, officers and directors have entered into a letter agreement
with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and (along with
Cantor) placement shares and any public shares held by them in connection with the completion of our initial business combination.
Manner of Conducting Redemptions
We will provide our public stockholders with
the opportunity to redeem all or a portion of their shares of Class A common stock upon the completion of our initial business
combination either (i) in connection with a stockholder meeting called to approve the initial business combination or (ii) by means
of a tender offer. The decision as to whether we will seek stockholder approval of a proposed initial business combination or conduct
a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the
transaction and whether the terms of the transaction would require us to seek stockholder approval under the law or stock exchange
listing requirement. Under NASDAQ rules, asset acquisitions and stock purchases would not typically require stockholder approval
while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding
common stock or seek to amend our amended and restated certificate of incorporation would require stockholder approval. If we structure
an initial business combination with a target company in a manner that requires stockholder approval, we will not have discretion
as to whether to seek a stockholder vote to approve the proposed initial business combination. We may conduct redemptions without
a stockholder vote pursuant to the tender offer rules of the SEC unless stockholder approval is required by law or stock exchange
listing requirements or we choose to seek stockholder approval for business or other legal reasons. So long as we obtain and maintain
a listing for our securities on NASDAQ, we are required to comply with such rules.
If a stockholder vote is not required and
we do not decide to hold a stockholder vote for business or other legal reasons, we will, pursuant to our amended and restated
certificate of incorporation:
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conduct the redemptions pursuant to Rule 13e-4 and Regulation
14E of the Exchange Act, which regulate issuer tender offers, and
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file tender offer documents with the SEC prior to completing
our initial business combination which contain substantially the same financial and other information about the initial business
combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation
of proxies.
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Upon the public announcement of our initial
business combination, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase shares of
our Class A common stock in the open market if we elect to redeem our public shares through a tender offer, to comply with Rule
14e-5 under the Exchange Act.
In the event we conduct redemptions pursuant
to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a)
under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender
offer period. In addition, the tender offer will be conditioned on public stockholders not tendering more than a specified number
of public shares which are not purchased by our sponsor, which number will be based on the requirement that we will only redeem
our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior
to or upon consummation of our initial business combination and after payment of underwriters’ fees and commissions (so that
we are not subject to the SEC’s “penny stock” rules) or any greater net tangible asset or cash requirement which
may be contained in the agreement relating to our initial business combination. If public stockholders tender more shares than
we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination.
If, however, stockholder approval of the
transaction is required by law or stock exchange listing requirement, or we decide to obtain stockholder approval for business
or other legal reasons, we will, pursuant to our amended and restated certificate of incorporation:
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conduct the redemptions in conjunction with a proxy solicitation
pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer
rules, and
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file proxy materials with the SEC.
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In the event that we seek stockholder approval
of our initial business combination, we will distribute proxy materials and, in connection therewith, provide our public stockholders
with the redemption rights described above upon completion of the initial business combination.
If we seek stockholder approval, we will
complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor
of the initial business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares
of outstanding capital stock of the company representing a majority of the voting power of all outstanding shares of capital stock
of the company entitled to vote at such meeting. Our initial stockholders will count toward this quorum and pursuant to the letter
agreement, our sponsor, officers and directors have agreed to vote their founder shares and placement shares and any public shares
purchased (including in open market and privately negotiated transactions) in favor of our initial business combination. For purposes
of seeking approval of the majority of our outstanding shares of common stock voted, non-votes will have no effect on the approval
of our initial business combination once a quorum is obtained. As a result, in addition to our initial stockholders’ founder
shares and placement shares, we would need only 12,720,001, or 36.3%, of the 35,000,000 public shares sold in our initial public
offering to be voted in favor of an initial business combination (assuming all outstanding shares are voted) in order to have our
initial business combination approved. We intend to give approximately 30 days (but not less than 10 days nor more than 60
days) prior written notice of any such meeting, if required, at which a vote shall be taken to approve our initial business combination.
These quorum and voting thresholds, and the voting agreements of our initial stockholders, may make it more likely that we will
consummate our initial business combination. Each public stockholder may elect to redeem its public shares irrespective of whether
they vote for or against the proposed transaction.
Our amended and restated certificate of incorporation
provides that we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least
$5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters’
fees and commissions (so that we are not subject to the SEC’s “penny stock” rules) or any greater net tangible
asset or cash requirement which may be contained in the agreement relating to our initial business combination. For example, the
proposed initial business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to
be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy
other conditions in accordance with the terms of the proposed initial business combination. In the event the aggregate cash consideration
we would be required to pay for all shares of Class A common stock that are validly submitted for redemption plus any amount required
to satisfy cash conditions pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash
available to us, we will not complete the initial business combination or redeem any shares, and all shares of Class A common stock
submitted for redemption will be returned to the holders thereof.
Limitation on Redemption upon Completion of our Initial
Business Combination if we Seek Stockholder Approval
Notwithstanding the foregoing, if we seek
stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
combination pursuant to the tender offer rules, our amended and restated 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 seeking redemption rights with respect to more than
an aggregate of 15% of the shares sold in our initial public offering, which we refer to as the “Excess Shares.” Such
restriction shall also be applicable to our affiliates. We believe this restriction will discourage stockholders from accumulating
large blocks of shares, and subsequent attempts by such holders to use their ability to exercise their redemption rights against
a proposed initial business combination as a means to force us or our management to purchase their shares at a significant premium
to the then-current market price or on other undesirable terms. Absent this provision, a public stockholder holding an aggregate
of 15% of the shares sold in our initial public offering could threaten to exercise its redemption rights if such holder’s
shares are not purchased by us or our management at a premium to the then-current market price or on other undesirable terms. By
limiting our stockholders’ ability to redeem no more than 15% of the shares sold in our initial public offering without our
prior consent, we believe we will limit the ability of a small group of stockholders to unreasonably attempt to block our ability
to complete our initial business combination, particularly in connection with an initial business combination with a target that
requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting
our stockholders’ ability to vote all of their shares (including Excess Shares) for or against our initial business combination.
Tendering Stock Certificates in Connection with Redemption
Rights
We may require our public stockholders seeking
to exercise their redemption rights, whether they are record holders or hold their shares in “street name,” to either
tender their certificates to our transfer agent up to two business days prior to the vote on the proposal to approve the initial
business combination, or to deliver their shares to the transfer agent electronically using the Depository Trust Company’s
DWAC (Deposit/Withdrawal At Custodian) System, at the holder’s option. The proxy materials that we will furnish to holders
of our public shares in connection with our initial business combination will indicate whether we are requiring public stockholders
to satisfy such delivery requirements. Accordingly, a public stockholder would have up to two days prior to the vote on the initial
business combination to tender its shares if it wishes to seek to exercise its redemption rights. Given the relatively short exercise
period, it is advisable for stockholders to use electronic delivery of their public shares.
There is a nominal cost associated with the
above-referenced tendering process and the act of certificating the shares or delivering them through the DWAC System. The transfer
agent will typically charge the tendering broker $80.00 and it would be up to the broker whether or not to pass this cost on to
the redeeming holder. However, this fee would be incurred regardless of whether or not we require holders seeking to exercise redemption
rights to tender their shares. The need to deliver shares is a requirement of exercising redemption rights regardless of the timing
of when such delivery must be effectuated.
Any request to redeem such shares, once made,
may be withdrawn at any time up to the date of the stockholder meeting. Furthermore, if a holder of a public share delivered its
certificate in connection with an election of redemption rights and subsequently decides prior to the applicable date not to elect
to exercise such rights, such holder may simply request that the transfer agent return the certificate (physically or electronically).
It is anticipated that the funds to be distributed to holders of our public shares electing to redeem their shares will be distributed
promptly after the completion of our initial business combination.
If our initial business combination is not
approved or completed for any reason, then our public stockholders who elected to exercise their redemption rights would not be
entitled to redeem their shares for the applicable pro rata share of the trust account. In such case, we will promptly return any
certificates delivered by public holders who elected to redeem their shares.
If our initial proposed initial business
combination is not completed, we may continue to try to complete an initial business combination with a different target until
September 19, 2021.
Redemption of Public Shares and Liquidation if no Initial
Business Combination
Our amended and restated certificate of incorporation
provides that we have until September 19, 2021 to complete our initial business combination. If we are unable to complete our initial
business combination by September 19, 2021, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly
as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable
in cash, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the
trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses),
divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders’
rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and
(iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our
board of directors, dissolve and liquidate, subject in the case of clauses (ii) and (iii) above to our obligations under Delaware
law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating
distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination
by September 19, 2021.
Our sponsor, officers and directors have
entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the
trust account with respect to any founder shares and) along with Cantor) placement shares held by them if we fail to complete our
initial business combination by September 19, 2021. However, if our sponsor, officers or directors acquire public shares, they
will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete
our initial business combination by September 19, 2021.
Our sponsor, officers and directors have
agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate
of incorporation (i) to modify the substance or timing of our obligation to allow redemption in connection with our initial business
combination or to redeem 100% of our public shares if we do not complete our initial business combination by September 19, 2021
or (ii) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity,
unless we provide our public stockholders with the opportunity to redeem their shares of Class A common stock upon approval of
any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including
interest earned on the funds held in the trust account and not previously released to us to pay our taxes divided by the number
of then outstanding public shares. However, we will only redeem our public shares so long as (after such redemption) our net tangible
assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after
payment of underwriters’ fees and commissions (so that we are not subject to the SEC’s “penny stock” rules).
If this optional redemption right is exercised with respect to an excessive number of public shares such that we cannot satisfy
the net tangible asset requirement (described above), we would not proceed with the amendment or the related redemption of our
public shares at such time.
We expect that all costs and expenses associated
with implementing our plan of dissolution, as well as payments to any creditors, will be funded from amounts remaining out of the
approximately $994,800 of proceeds held outside the trust account (as of December 31, 2019), although we cannot assure you that
there will be sufficient funds for such purpose. We will depend on sufficient interest being earned on the proceeds held in the
trust account to pay any tax obligations we may owe. However, if those funds are not sufficient to cover the costs and expenses
associated with implementing our plan of dissolution, to the extent that there is any interest accrued in the trust account not
required to pay taxes on interest income earned on the trust account balance, we may request the trustee to release to us an additional
amount of up to $100,000 of such accrued interest to pay those costs and expenses.
If we were to expend all of the net proceeds
of our initial public offering and the sale of the placement units, other than the proceeds deposited in the trust account, and
without taking into account interest, if any, earned on the trust account, the per-share redemption amount received by stockholders
upon our dissolution would be approximately $10.00. The proceeds deposited in the trust account could, however, become subject
to the claims of our creditors which would have higher priority than the claims of our public stockholders. We cannot assure you
that the actual per-share redemption amount received by stockholders will not be substantially less than $10.00. Under Section
281(b) of the DGCL, our plan of dissolution must provide for all claims against us to be paid in full or make provision for payments
to be made in full, as applicable, if there are sufficient assets. These claims must be paid or provided for before we make any
distribution of our remaining assets to our stockholders. While we intend to pay such amounts, if any, we cannot assure you that
we will have funds sufficient to pay or provide for all creditors’ claims.
Although we have sought and will continue
to seek to have all vendors, service providers (other than our independent auditor), prospective target businesses or other entities
with which we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to any monies
held in the trust account for the benefit of our public stockholders, there is no guarantee that they will execute such agreements
or even if they execute such agreements that they would be prevented from bringing claims against the trust account including but
not limited to fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging
the enforceability of the waiver, in each case in order to gain an advantage with respect to a claim against our assets, including
the funds held in the trust account. If any third party refuses to execute an agreement waiving such claims to the monies held
in the trust account, our management will perform an analysis of the alternatives available to it and will only enter into an agreement
with a third party that has not executed a waiver if management believes that such third party’s engagement would be significantly
more beneficial to us than any alternative. Examples of possible instances where we may engage a third party that refuses to execute
a waiver include the engagement of a third party consultant whose particular expertise or skills are believed by management to
be significantly superior to those of other consultants that would agree to execute a waiver or in cases where management is unable
to find a service provider willing to execute a waiver. WithumSmith+Brown, PC, our independent registered public accounting firm,
and Cantor, the underwriters of the offering, will not execute agreements with us waiving such claims to the monies held in the
trust account.
In addition, there is no guarantee that such
entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts
or agreements with us and will not seek recourse against the trust account for any reason. Our sponsor has agreed that it will
be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective
target business with which we have entered into a written letter of intent, confidentiality or similar agreement or business combination
agreement, reduce the amount of funds in the trust account to below the lesser of (i) $10.00 per public share and (ii) the actual
amount per public share held in the trust account as of the date of the liquidation of the trust account, if less than $10.00 per
share due to reductions in the value of the trust assets, less taxes payable, provided that such liability will not apply to any
claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the trust
account (whether or not such waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters of
our initial public offering against certain liabilities, including liabilities under the Securities Act. However, we have not asked
our sponsor to reserve for such indemnification obligations, nor have we independently verified whether our sponsor has sufficient
funds to satisfy its indemnity obligations and believe that our sponsor’s only assets are securities of our company. Therefore,
we cannot assure you that our sponsor would be able to satisfy those obligations. None of our officers or directors will indemnify
us for claims by third parties including, without limitation, claims by vendors and prospective target businesses.
In the event that the proceeds in the trust
account are reduced below (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 value of the trust assets, in each case net of the amount
of interest which may be withdrawn to pay taxes, and our sponsor asserts that it is unable to satisfy its indemnification obligations
or that it has no indemnification obligations related to a particular claim, our independent directors would determine whether
to take legal action against our sponsor to enforce its indemnification obligations. While we currently expect that our independent
directors would take legal action on our behalf against our sponsor to enforce its indemnification obligations to us, it is possible
that our independent directors in exercising their business judgment may choose not to do so if, for example, the cost of such
legal action is deemed by the independent directors to be too high relative to the amount recoverable or if the independent directors
determine that a favorable outcome is not likely. We have not asked our sponsor to reserve for such indemnification obligations
and we cannot assure you that our sponsor would be able to satisfy those obligations. Accordingly, we cannot assure you that due
to claims of creditors the actual value of the per-share redemption price will not be less than $10.00 per public share.
We seek to reduce the possibility that our
sponsor has to indemnify the trust account due to claims of creditors by endeavoring to have all vendors, service providers (other
than our independent auditor), prospective target businesses or other entities with which we do business execute agreements with
us waiving any right, title, interest or claim of any kind in or to monies held in the trust account. Our sponsor will also not
be liable as to any claims under our indemnity of the underwriters of our initial public offering against certain liabilities,
including liabilities under the Securities Act. We have access to up to approximately $994,800 of the proceeds held outside the
trust account (as of December 31, 2019) with which to pay any such potential claims (including costs and expenses incurred in connection
with our liquidation, currently estimated to be no more than approximately $100,000). In the event that we liquidate and it is
subsequently determined that the reserve for claims and liabilities is insufficient, stockholders who received funds from our trust
account could be liable for claims made by creditors.
Under the DGCL, stockholders may be held
liable for claims by third parties against a corporation to the extent of distributions received by them in a dissolution. The
pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event
we do not complete our initial business combination by September 19, 2021 may be considered a liquidating distribution under Delaware
law. Delaware law provides that if a corporation complies with certain procedures set forth in Section 280 of the DGCL intended
to ensure that it makes reasonable provision for all claims against it, including a 60-day notice period during which any third-party
claims can be brought against the corporation, a 90-day period during which the corporation may reject any claims brought, and
an additional 150-day waiting period before any liquidating distributions are made to stockholders, any liability of stockholders
with respect to a liquidating distribution is limited to the lesser of such stockholder’s pro rata share of the claim or
the amount distributed to the stockholder, and any liability of the stockholder would be barred after the third anniversary of
the dissolution.
Furthermore, if the pro rata portion of our
trust account distributed to our public stockholders upon the redemption of our public shares in the event we do not complete our
initial business combination by September 19, 2021, is not considered a liquidating distribution under Delaware law and such redemption
distribution is deemed to be unlawful (potentially due to the imposition of legal proceedings that a party may bring or due to
other circumstances that are currently unknown), then pursuant to Section 174 of the DGCL, the statute of limitations for claims
of creditors could then be six years after the unlawful redemption distribution, instead of three years, as in the case of a liquidating
distribution. If we are unable to complete our initial business combination by September 19, 2021, we will: (i) cease all operations
except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem
the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including
interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000
of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely
extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions,
if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval
of our remaining stockholders and our board of directors, dissolve and liquidate, subject in the case of clauses (ii) and (iii)
above to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. Accordingly,
it is our intention to redeem our public shares as soon as reasonably possible following September 19, 2021 and, therefore, we
do not intend to comply with those procedures. As such, our stockholders could potentially be liable for any claims to the extent
of distributions received by them (but no more) and any liability of our stockholders may extend well beyond the third anniversary
of such date.
Because we are complying with Section 280,
Section 281(b) of the DGCL requires us to adopt a plan, based on facts known to us at such time that will provide for our payment
of all existing and pending claims or claims that may be potentially brought against us within the subsequent 10 years. However,
because we are a blank check company, rather than an operating company, and our operations are limited to searching for prospective
target businesses to acquire, the only likely claims to arise would be from our vendors (such as lawyers, investment bankers, and
auditors) or prospective target businesses. As described above, pursuant to the obligation contained in our underwriting agreement,
we have sought and will continue to seek to have all vendors, service providers (other than our independent auditor), prospective
target businesses or other entities with which we do business execute agreements with us waiving any right, title, interest or
claim of any kind in or to any monies held in the trust account. As a result of this obligation, the claims that could be made
against us are significantly limited and the likelihood that any claim that would result in any liability extending to the trust
account is remote. Further, our sponsor may be liable only to the extent necessary to ensure that the amounts in the trust account
are not reduced 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 value of the trust assets, in each case net of the amount of
interest withdrawn to pay taxes and will not be liable as to any claims under our indemnity of the underwriters of our initial
public offering against certain liabilities, including liabilities under the Securities Act. In the event that an executed waiver
is deemed to be unenforceable against a third party, our sponsor will not be responsible to the extent of any liability for such
third-party claims.
If we file a bankruptcy petition or an involuntary
bankruptcy petition is filed against us that is not dismissed, the proceeds held in the trust account could be subject to applicable
bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of third parties with priority over the
claims of our stockholders. To the extent any bankruptcy claims deplete the trust account, we cannot assure you we will be able
to return $10.00 per share to our public stockholders. Additionally, if we file a bankruptcy petition or an involuntary bankruptcy
petition is filed against us that is not dismissed, any distributions received by stockholders could be viewed under applicable
debtor/creditor and/or bankruptcy laws as either a “preferential transfer” or a “fraudulent conveyance.”
As a result, a bankruptcy court could seek to recover some or all amounts received by our stockholders. Furthermore, our board
of directors may be viewed as having breached its fiduciary duty to our creditors and/or may have acted in bad faith, thereby exposing
itself and our company to claims of punitive damages, by paying public stockholders from the trust account prior to addressing
the claims of creditors. We cannot assure you that claims will not be brought against us for these reasons.
Our public stockholders will be entitled
to receive funds from the trust account only upon the earlier to occur of: (i) the completion of our initial business combination,
(ii) the redemption of any public shares properly tendered in connection with a stockholder vote to amend any provisions of our
amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in
connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business
combination by September 19, 2021 or (B) with respect to any other provision relating to stockholders’ rights or pre-initial
business combination activity, and (iii) the redemption of all of our public shares if we are unable to complete our business
combination by September 19, 2021, subject to applicable law. In no other circumstances will a stockholder have any right or interest
of any kind to or in the trust account. In the event we seek stockholder approval in connection with our initial business combination,
a stockholder’s voting in connection with the initial business combination alone will not result in a stockholder’s
redeeming its shares to us for an applicable pro rata share of the trust account. Such stockholder must have also exercised its
redemption rights as described above. These provisions of our amended and restated certificate of incorporation, like all provisions
of our amended and restated certificate of incorporation, may be amended with a stockholder vote.
Competition
In identifying, evaluating and selecting
a target business for our initial business combination, we have encountered, and may continue to encounter intense competition
from other entities having a business objective similar to ours, including other blank check companies, private equity groups and
leveraged buyout funds, and operating businesses seeking strategic business combinations. Many of these entities are well established
and have extensive experience identifying and effecting business combinations directly or through affiliates. Moreover, many of
these competitors possess greater financial, technical, human and other resources than we do. Our ability to acquire larger target
businesses is limited by our available financial resources. This inherent limitation gives others an advantage in pursuing the
initial business combination of a target business. Furthermore, our obligation to pay cash in connection with our public stockholders
who exercise their redemption rights may reduce the resources available to us for our initial business combination and our outstanding
warrants, and the future dilution they potentially represent, may not be viewed favorably by certain target businesses. Either
of these factors may place us at a competitive disadvantage in successfully negotiating an initial business combination.
Employees
We currently have two officers. These individuals
are not obligated to devote any specific number of hours to our matters but they devote as much of their time as they deem necessary
and intend to continue doing so, in the exercise of their respective business judgement, to our affairs until we have completed
our initial business combination. The amount of time they devote in any time period will vary based on whether a target business
has been selected for our initial business combination and the stage of the initial business combination process we are in. We
do not intend to have any full time employees prior to the completion of our initial business combination. We do not have an employment
agreement with any member of our management team.
Periodic Reporting and Financial Information
Our units, Class A common stock and warrants
are registered under the Exchange Act and have reporting obligations, including the requirement that we file annual, quarterly
and current reports with the SEC. In accordance with the requirements of the Exchange Act, this Report contains financial statements
audited and reported on by our independent registered public accountants.
We will provide stockholders with audited
financial statements of the prospective target business as part of the tender offer materials or proxy solicitation materials sent
to stockholders to assist them in assessing the target business. In all likelihood, these financial statements will need to be
prepared in accordance with, or reconciled to, GAAP, or IFRS, depending on the circumstances, and the historical financial statements
may be required to be audited in accordance with the standards of the PCAOB. These financial statement requirements may limit the
pool of potential targets we may conduct an initial business combination with because some targets may be unable to provide such
statements in time for us to disclose such statements in accordance with federal proxy rules and complete our initial business
combination within the prescribed time frame. We cannot assure you that any particular target business identified by us as a potential
business combination candidate will have financial statements prepared in accordance with GAAP or that the potential target business
will be able to prepare its financial statements in accordance with the requirements outlined above. To the extent that these requirements
cannot be met, we may not be able to acquire the proposed target business. While this may limit the pool of potential business
combination candidates, we do not believe that this limitation will be material.
We are required to evaluate our internal
control procedures for the fiscal year ending December 31, 2020 as required by the Sarbanes-Oxley Act. Only in the event we are
deemed to be a large accelerated filer or an accelerated filer, and no longer an emerging growth company, will we be required to
have our internal control procedures audited. A target company may not be in compliance with the provisions of the Sarbanes-Oxley
Act regarding adequacy of their internal controls. The development of the internal controls of any such entity to achieve compliance
with the Sarbanes-Oxley Act may increase the time and costs necessary to complete any such business combination.
We will remain an emerging growth company
until the earlier of (1) the last day of the fiscal year (a) following September 19, 2024, (b) in which we have total annual gross
revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value
of our shares of Class A common stock that are held by non-affiliates exceeds $700 million as of the prior June 30th,
and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.
Item 1A.
Risk Factors.
You should carefully consider all of the
following risk factors and all of the other information contained in this Report, including the financial statements. If any of
the following risks occur, our business, financial condition or results of operations may be materially and adversely affected.
In that event, the trading price of our securities could decline, and you could lose all or part of your investment. The risk factors
described below are not necessarily exhaustive and you are encouraged to perform your own investigation with respect to us and
our business.
We are a recently formed early-stage company with no operating
history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective.
We are a recently formed early-stage company
with no operating results. Because we lack an operating history, you have no basis upon which to evaluate our ability to achieve
our business objective of completing our initial business combination with one or more target businesses. We may be unable to complete
our initial business combination. If we fail to complete our initial business combination, we will never generate any operating
revenues.
Our public stockholders may not be afforded an opportunity
to vote on our proposed initial business combination, which means we may complete our initial business combination even if a majority
of our public stockholders do not support such a combination.
We may choose not to hold a stockholder vote
to approve our initial business combination unless the initial business combination would require stockholder approval under applicable
law or stock exchange listing requirements or if we decide to hold a stockholder vote for business or other legal reasons. Except
as required by law, the decision as to whether we will seek stockholder approval of a proposed initial business combination or
will allow stockholders to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be
based on a variety of factors, such as the timing of the transaction and whether the terms of the transaction would otherwise require
us to seek stockholder approval. Accordingly, we may complete our initial business combination even if holders of a majority of
our public shares do not approve of the initial business combination we complete.
If we seek stockholder approval of our initial business combination,
after approval of our board, our initial stockholders have agreed to vote in favor of such initial business combination, regardless
of how our public stockholders vote.
Pursuant to the letter agreement, our sponsor,
officers and directors have agreed to vote their founder shares and placement shares, as well as any public shares purchased after
our initial public offering (including in open market and privately negotiated transactions), in favor of our initial business
combination. As a result, in addition to our initial stockholders’ founder shares and placement shares, we would need only
12,720,001, or 36.3%, of the 35,000,000 public shares sold in our initial public offering to be voted in favor of an initial business
combination (assuming all outstanding shares are voted) in order to have our initial business combination approved. Our initial
stockholders own shares representing approximately 21.5% of our outstanding shares of common stock. Accordingly, if we seek stockholder
approval of our initial business combination, after approval of our board, the agreement by our initial stockholders to vote in
favor of our initial business combination will increase the likelihood that we will receive the requisite stockholder approval
for such initial business combination.
Your only opportunity to affect the investment decision regarding
a potential business combination will be limited to the exercise of your right to redeem your shares from us for cash, unless we
seek stockholder approval of the initial business combination.
At the time of your investment in us, you will not be provided
with an opportunity to evaluate the specific merits or risks of our initial business combination. Since our board of directors
may complete an initial business combination without seeking stockholder approval, public stockholders may not have the right or
opportunity to vote on the initial business combination, unless we seek such stockholder vote. Accordingly, if we do not seek stockholder
approval, your only opportunity to affect the investment decision regarding a potential business combination may be limited to
exercising your redemption rights within the period of time (which will be at least 20 business days) set forth in our tender
offer documents mailed to our public stockholders in which we describe our initial business combination.
The occurrence of natural disasters may
adversely affect our business, financial condition and results of operations following our business combination.
The occurrence of natural disasters, including hurricanes, floods,
earthquakes, tornadoes, fires and pandemic disease may adversely affect our business, financial condition or results of operations
following our business combination. The potential impact of a natural disaster on our results of operations and financial position
is speculative and would depend on numerous factors. The extent and severity of these natural disasters determines their effect
on a given economy. Although the long-term effect of diseases such as the COVID-19 “coronavirus,” H5N1 “avian
flu,” or H1N1, the “swine flu,” cannot currently be predicted, previous occurrences of avian flu and swine flu
had an adverse effect on the economies of those countries in which they were most prevalent. An outbreak of a communicable disease
in our market could adversely affect our business, financial condition and results of operations, and timely reporting obligations
under Regulation S-X and Regulation S-K following our business combination. We cannot assure you that natural disasters will not
occur in the future or that our business, financial condition and results of operations will not be adversely affected.
Our search for a business combination, and any target business
with which we ultimately consummate a business combination, may be materially adversely affected by the recent coronavirus (COVID-19)
outbreak or the related market decline and volatility.
In December 2019, a novel strain of coronavirus
was reported to have surfaced in Wuhan, China, which has and is continuing to spread throughout China and other parts of the world,
including the United States. On January 30, 2020, the World Health Organization declared the outbreak of the coronavirus disease
(COVID-19) a “Public Health Emergency of International Concern.” On January 31, 2020, U.S. Health and Human Services
Secretary Alex M. Azar II declared a public health emergency for the United States to aid the U.S. healthcare community in responding
to COVID-19, and on March 11, 2020 the World Health Organization characterized the outbreak as a “pandemic”. A significant
outbreak of COVID-19 and other infectious diseases could result in a widespread health crisis that could adversely affect the economies
and financial markets worldwide, and the business of any potential target business with which we consummate a business combination
could be materially and adversely affected. The recent market decline and volatility in connection with the COVID-19 pandemic
could also materially and adversely affect a potential target’s willingness to consummate a business combination with us.
Furthermore, we may be unable to complete a business combination if continued concerns relating to COVID-19 restrict travel, limit
the ability to have meetings with potential investors or the target company’s personnel, vendors and services providers are
unavailable to negotiate and consummate a transaction in a timely manner. The extent to which COVID-19 impacts our search for a
business combination will depend on future developments, which are highly uncertain and cannot be predicted, including new information
which may emerge concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others. If
the disruptions posed by COVID-19 or other matters of global concern continue for an extensive period of time, our ability to consummate
a business combination, or the operations of a target business with which we ultimately consummate a business combination, may
be materially adversely affected.
The ability of our public stockholders to redeem their shares
for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for
us to enter into an initial business combination with a target.
We may seek to enter into an initial business
combination agreement with a prospective target that requires as a closing condition that we have a minimum net worth or a certain
amount of cash. If too many public stockholders exercise their redemption rights, we would not be able to meet such closing condition
and, as a result, would not be able to proceed with the initial business combination. Furthermore, we will only redeem our public
shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon
consummation of our initial business combination and after payment of underwriters’ fees and commissions (so that we are
not subject to the SEC’s “penny stock” rules) or any greater net tangible asset or cash requirement which may
be contained in the agreement relating to our initial business combination. Consequently, if accepting all properly submitted redemption
requests would cause our net tangible assets to be less than $5,000,001 or such greater amount necessary to satisfy a closing condition,
each as described above, we would not proceed with such redemption and the related business combination and may instead search
for an alternate business combination. Prospective targets will be aware of these risks and, thus, may be reluctant to enter into
an initial business combination with us.
The ability of our public stockholders to exercise redemption
rights with respect to a large number of our shares may not allow us to complete the most desirable business combination or optimize
our capital structure.
At the time we enter into an agreement for
our initial business combination, we will not know how many stockholders may exercise their redemption rights, and therefore will
need to structure the transaction based on our expectations as to the number of shares that will be submitted for redemption. If
our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price,
or requires us to have a minimum amount of cash at closing, we will need to reserve a portion of the cash in the trust account
to meet such requirements, or arrange for third party financing. In addition, if a larger number of shares are submitted for redemption
than we initially expected, we may need to restructure the transaction to reserve a greater portion of the cash in the trust account
or arrange for third party financing. Raising additional third party financing may involve dilutive equity issuances or the incurrence
of indebtedness at higher than desirable levels. Furthermore, this dilution would increase to the extent that the anti-dilution
provision of the Class B common stock result in the issuance of Class A shares on a greater than one-to-one basis upon conversion
of the Class B common stock at the time of our business combination. The above considerations may limit our ability to complete
the most desirable business combination available to us or optimize our capital structure. The amount of the deferred underwriting
commissions payable to the underwriters will not be adjusted for any shares that are redeemed in connection with an initial business
combination. The per-share amount we will distribute to stockholders who properly exercise their redemption rights will not be
reduced by the deferred underwriting commission and after such redemptions, the per-share value of shares held by non-redeeming
stockholders will reflect our obligation to pay the deferred underwriting commissions.
The ability of our public stockholders to exercise redemption
rights with respect to a large number of our shares could increase the probability that our initial business combination would
be unsuccessful and that you would have to wait for liquidation in order to redeem your stock.
If our initial business combination agreement
requires us to use a portion of the cash in the trust account to pay the purchase price, or requires us to have a minimum amount
of cash at closing, the probability that our initial business combination would be unsuccessful is increased. If our initial business
combination is unsuccessful, you would not receive your pro rata portion of the trust account until we liquidate the trust account.
If you are in need of immediate liquidity, you could attempt to sell your stock in the open market; however, at such time our stock
may trade at a discount to the pro rata amount per share in the trust account. In either situation, you may suffer a material loss
on your investment or lose the benefit of funds expected in connection with our redemption until we liquidate or you are able to
sell your stock in the open market.
The requirement that we complete our initial business combination
within the prescribed time frame may give potential target businesses leverage over us in negotiating an initial business combination
and may decrease our ability to conduct due diligence on potential business combination targets as we approach our dissolution
deadline, which could undermine our ability to complete our initial business combination on terms that would produce value for
our stockholders.
Any potential target business with which
we enter into negotiations concerning an initial business combination will be aware that we must complete our initial business
combination by September 19, 2021. Consequently, such target business may obtain leverage over us in negotiating an initial business
combination, knowing that if we do not complete our initial business combination with that particular target business, we may be
unable to complete our initial business combination with any target business. This risk will increase as we get closer to the timeframe
described above. In addition, we may have limited time to conduct due diligence and may enter into our initial business combination
on terms that we would have rejected upon a more comprehensive investigation.
We may not be able to complete our initial business combination
within the prescribed time frame, in which case we would cease all operations except for the purpose of winding up and we would
redeem our public shares and liquidate, in which case our public stockholders may only receive $10.00 per share, or less than such
amount in certain circumstances, and our warrants will expire worthless.
Our amended and restated certificate of incorporation
provides that we must complete our initial business combination by September 19, 2021. We may not be able to find a suitable target
business and complete our initial business combination by such date. If we have not completed our initial business combination
by such date, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible
but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate
amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously
released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding
public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right
to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible
following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate,
subject in the case of clauses (ii) and (iii) above to our obligations under Delaware law to provide for claims of creditors and
the requirements of other applicable law. In such case, our public stockholders may only receive $10.00 per share, and our warrants
will expire worthless. In certain circumstances, our public stockholders may receive less than $10.00 per share on the redemption
of their shares.
If we seek stockholder approval of our initial business combination,
our sponsor, directors, officers, advisors and their affiliates may elect to purchase shares or warrants from public stockholders,
which may influence a vote on a proposed initial business combination and reduce the public “float” of our Class A
common stock.
If we seek stockholder approval of our initial
business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender
offer rules, our sponsor, directors, officers, advisors or their affiliates may purchase shares or public warrants or a combination
thereof in privately negotiated transactions or in the open market either prior to or following the completion of our initial business
combination, although they are under no obligation to do so. However, they have no current commitments, plans or intentions to
engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds in the
trust account will be used to purchase shares or public warrants in such transactions.
Such a purchase may include a contractual
acknowledgement that such stockholder, although still the record holder of our shares is no longer the beneficial owner thereof
and therefore agrees not to exercise its redemption rights. In the event that our sponsor, directors, officers, advisors or their
affiliates purchase shares in privately negotiated transactions from public stockholders who have already elected to exercise their
redemption rights, such selling stockholders would be required to revoke their prior elections to redeem their shares. The purpose
of such purchases could be to vote such shares in favor of the initial business combination and thereby increase the likelihood
of obtaining stockholder approval of the initial business combination, or to satisfy a closing condition in an agreement with a
target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination,
where it appears that such requirement would otherwise not be met. The purpose of any such purchases of public warrants could be
to reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for
approval in connection with our initial business combination. Any such purchases of our securities may result in the completion
of our initial business combination that may not otherwise have been possible. Any such purchases will be reported pursuant to
Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements.
In addition, if such purchases are made,
the public “float” of our Class A common stock or public warrants and the number of beneficial holders of our securities
may be reduced, possibly making it difficult to maintain the quotation, listing or trading of our securities on a national securities
exchange.
If a stockholder fails to receive notice of our offer to
redeem our public shares in connection with our initial business combination, or fails to comply with the procedures for tendering
its shares, such shares may not be redeemed.
We will comply with the tender offer rules
or proxy rules, as applicable, when conducting redemptions in connection with our initial business combination. Despite our compliance
with these rules, if a stockholder fails to receive our tender offer or proxy materials, as applicable, such stockholder may not
become aware of the opportunity to redeem its shares. In addition, proxy materials or tender offer documents, as applicable, that
we will furnish to holders of our public shares in connection with our initial business combination will describe the various procedures
that must be complied with in order to validly tender or redeem public shares. For example, we may require our public stockholders
seeking to exercise their redemption rights, whether they are record holders or hold their shares in “street name,”
to either tender their certificates to our transfer agent prior to the date set forth in the tender offer documents mailed to such
holders, or up to two business days prior to the vote on the proposal to approve the initial business combination in the event
we distribute proxy materials, or to deliver their shares to the transfer agent electronically. In the event that a stockholder
fails to comply with these or any other procedures, its shares may not be redeemed.
You will not have any rights or interests in funds from the
trust account, except under certain limited circumstances. To liquidate your investment, therefore, you may be forced to sell your
public shares or warrants, potentially at a loss.
Our public stockholders will be entitled
to receive funds from the trust account only upon the earliest to occur of: (i) our completion of an initial business combination,
and then only in connection with those shares of Class A common stock that such stockholder properly elected to redeem, subject
to the limitations described herein, (ii) the redemption of any public shares properly submitted in connection with a stockholder
vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to
allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete
our initial business combination by September 19, 2021 from the closing of our initial public offering or (B) with respect to any
other provision relating to stockholders’ rights or pre-initial business combination activity and (iii) the redemption of
our public shares if we are unable to complete an initial business combination by September 19, 2021, subject to applicable law
and as further described herein. In no other circumstances will a public stockholder have any right or interest of any kind in
the trust account. Holders of warrants will not have any right to the proceeds held in the trust account with respect to the warrants.
Accordingly, to liquidate your investment, you may be forced to sell your public shares or warrants, potentially at a loss.
NASDAQ may delist our securities from trading on its exchange,
which could limit investors’ ability to make transactions in our securities and subject us to additional trading restrictions.
Our securities are currently listed on NASDAQ.
However, we cannot assure you that our securities will continue to be, listed on NASDAQ in the future or prior to our initial business
combination. In order to continue listing our securities on NASDAQ prior to our initial business combination, we must maintain
certain financial, distribution and stock price levels. Generally, we must maintain a minimum amount in stockholders’ equity
(generally $2,500,000) and a minimum number of holders of our securities (generally 300 public holders). Additionally, in connection
with our initial business combination, we will be required to demonstrate compliance with NASDAQ’s initial listing requirements,
which are more rigorous than NASDAQ’s continued listing requirements, in order to continue to maintain the listing of our
securities on NASDAQ. For instance, our stock price would generally be required to be at least $4.00 per share, our stockholders’
equity would generally be required to be at least $5.0 million and we would be required to have a minimum of 300 round lot holders
(with at least 50% of such round lot holders holding securities with a market value of at least $2,500) of our securities. We cannot
assure you that we will be able to meet those initial listing requirements at that time.
If NASDAQ delists our securities from trading
on its exchange and we are not able to list our securities on another national securities exchange, we expect our securities could
be quoted on an over-the-counter market. If this were to occur, we could face significant material adverse consequences, including:
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a limited availability of market quotations for our securities;
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reduced liquidity for our securities;
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a determination that our Class A common stock is a “penny
stock” which will require brokers trading in our Class A common stock to adhere to more stringent rules and possibly result
in a reduced level of trading activity in the secondary trading market for our securities;
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a limited amount of news and analyst coverage; and
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a decreased ability to issue additional securities or obtain
additional financing in the future.
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The National Securities Markets Improvement
Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which
are referred to as “covered securities.” Because our units, our Class A common stock and warrants are listed on NASDAQ,
our units, Class A common stock and our warrants are covered securities. Although the states are preempted from regulating the
sale of our securities, the federal statute does allow the states to investigate companies if there is a suspicion of fraud, and,
if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular
case. While we are not aware of a state having used these powers to prohibit or restrict the sale of securities issued by blank
check companies, other than the State of Idaho, certain state securities regulators view blank check companies unfavorably and
might use these powers, or threaten to use these powers, to hinder the sale of securities of blank check companies in their states.
Further, if we were no longer listed on NASDAQ, our securities would not be covered securities and we would be subject to regulation
in each state in which we offer our securities, including in connection with our initial business combination.
You will not be entitled to protections normally afforded
to investors of some other blank check companies.
Since the net proceeds of our initial public
offering and the sale of the placement units are intended to be used to complete an initial business combination with a target
business that has not been identified, we may be deemed to be a “blank check” company under the United States securities
laws. However, because we have net tangible assets in excess of $5,000,000, we are exempt from rules promulgated by the SEC to
protect investors in blank check companies, such as Rule 419. Accordingly, investors are not afforded the benefits or protections
of those rules. Among other things, this means that we have a longer period of time to complete our business combination than do
companies subject to Rule 419. Moreover, if our initial public offering were subject to Rule 419, that rule would prohibit the
release of any interest earned on funds held in the trust account to us unless and until the funds in the trust account were released
to us in connection with our completion of an initial business combination.
If we seek stockholder approval of our initial business combination
and we do not conduct redemptions pursuant to the tender offer rules, and if you or a “group” of stockholders are deemed
to hold 15% or more of our Class A common stock, you will lose the ability to redeem all such shares in excess of 15% of our Class
A common stock.
If we seek stockholder approval of our initial
business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender
offer rules, our amended and restated 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 seeking redemption rights with respect to an aggregate of 15% or
more of the shares sold in our initial public offering without our prior consent, which we refer to as the “Excess Shares.”
However, we would not be restricting our stockholders’ ability to vote all of their shares (including Excess Shares) for
or against our initial business combination. Your inability to redeem the Excess Shares will reduce your influence over our ability
to complete our initial business combination and you could suffer a material loss on your investment in us if you sell Excess Shares
in open market transactions. Additionally, you will not receive redemption distributions with respect to the Excess Shares if we
complete our initial business combination. And as a result, you will continue to hold that number of shares exceeding 15% and,
in order to dispose of such shares, would be required to sell your stock in open market transactions, potentially at a loss.
Because of our limited resources and the significant competition
for business combination opportunities, it may be more difficult for us to complete our initial business combination. If we are
unable to complete our initial business combination, our public stockholders may receive only approximately $10.00 per share on
our redemption of our public shares, or less than such amount in certain circumstances, and our warrants will expire worthless.
We have encountered and expect to continue
to encounter intense competition from other entities having a business objective similar to ours, including private investors (which
may be individuals or investment partnerships), other blank check companies and other entities competing for the types of businesses
we intend to acquire. Many of these individuals and entities are well-established and have extensive experience in identifying
and effecting, directly or indirectly, acquisitions of companies operating in or providing services to various industries. Many
of these competitors possess greater technical, human and other resources or more industry knowledge than we do, and our financial
resources are relatively limited when contrasted with those of many of these competitors. While we believe there are numerous target
businesses we could potentially acquire with the net proceeds of our initial public offering and the sale of the placement units,
our ability to compete with respect to the acquisition of certain target businesses that are sizable is limited by our available
financial resources. This inherent competitive limitation gives others an advantage in pursuing the acquisition of certain target
businesses. Furthermore, because we are obligated to pay cash for the shares of Class A common stock which our public stockholders
redeem in connection with our initial business combination, target companies will be aware that this may reduce the resources available
to us for our initial business combination. This may place us at a competitive disadvantage in successfully negotiating an initial
business combination. If we are unable to complete our initial business combination, our public stockholders may receive only approximately
$10.00 per share on the liquidation of our trust account and our warrants will expire worthless. In certain circumstances, our
public stockholders may receive less than $10.00 per share upon our liquidation.
If the net proceeds of our initial public offering and the
sale of the placement units not being held in the trust account are insufficient to allow us to operate until September 19, 2021,
we may be unable to complete our initial business combination, in which case our public stockholders may only receive $10.00 per
share, or less than such amount in certain circumstances, and our warrants will expire worthless.
The funds available to us outside of the
trust account may not be sufficient to allow us to operate until September 19, 2021, assuming that our initial business combination
is not completed during that time. We believe that the funds available to us outside of the trust account as of December 31, 2019
of $994,810 are sufficient to allow us to operate until September 19, 2021; however, we cannot assure you that our estimate is
accurate. Of the funds available to us, we could use a portion of the funds available to us to pay fees to consultants to assist
us with our search for a target business. We could also use a portion of the funds as a down payment or to fund a “no-shop”
provision (a provision in letters of intent or merger agreements designed to keep target businesses from “shopping”
around for transactions with other companies on terms more favorable to such target businesses) with respect to a particular proposed
initial business combination, although we do not have any current intention to do so. If we entered into a letter of intent or
merger agreement where we paid for the right to receive exclusivity from a target business and were subsequently required to forfeit
such funds (whether as a result of our breach or otherwise), we might not have sufficient funds to continue searching for, or conduct
due diligence with respect to, a target business. If we are unable to complete our initial business combination, our public stockholders
may receive only approximately $10.00 per share on the liquidation of our trust account and our warrants will expire worthless.
In certain circumstances, our public stockholders may receive less than $10.00 per share upon our liquidation.
If the net proceeds of our initial public offering and the
sale of the placement units not being held in the trust account are insufficient, it could limit the amount available to fund our
search for a target business or businesses and complete our initial business combination and we will depend on loans from our sponsor
or management team to fund our search for an initial business combination, to pay our taxes and to complete our initial business
combination. If we are unable to obtain these loans, we may be unable to complete our initial business combination.
Of the net proceeds of our initial public
offering and the sale of the placement units, only approximately $994,800 (as of December 31, 2019) will be available to us outside
the trust account to fund our working capital requirements. If we are required to seek additional capital, we would need to borrow
funds from our sponsor, management team or other third parties to operate or may be forced to liquidate. None of our sponsor, members
of our management team nor any of their affiliates is under any obligation to advance funds to us in such circumstances. Any such
advances would be repaid only from funds held outside the trust account or from funds released to us upon completion of our initial
business combination. Up to $1,500,000 of such loans may be convertible into units, at a price of $10.00 per unit at the option
of the lender, upon consummation of our initial business combination. The units would be identical to the placement units. Prior
to the completion of our initial business combination, we do not expect to seek loans from parties other than our sponsor or an
affiliate of our sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any
and all rights to seek access to funds in our trust account. If we are unable to obtain these loans, we may be unable to complete
our initial business combination. If we are unable to complete our initial business combination because we do not have sufficient
funds available to us, we will be forced to cease operations and liquidate the trust account. Consequently, our public stockholders
may only receive approximately $10.00 per share on our redemption of our public shares, and our warrants will expire worthless.
In certain circumstances, our public stockholders may receive less than $10.00 per share on the redemption of their shares.
Subsequent to the completion of our initial business combination,
we may be required to take write-downs or write-offs, restructuring and impairment or other charges that could have a significant
negative effect on our financial condition, results of operations and our stock price, which could cause you to lose some or all
of your investment.
Even if we conduct extensive due diligence
on a target business with which we combine, we cannot assure you that this diligence will surface all material issues that may
be present inside a particular target business, that it would be possible to uncover all material issues through a customary amount
of due diligence, or that factors outside of the target business and outside of our control will not later arise. As a result of
these factors, we may be forced to later write-down or write-off assets, restructure our operations, or incur impairment or other
charges that could result in our reporting losses. Even if our due diligence successfully identifies certain risks, unexpected
risks may arise and previously known risks may materialize in a manner not consistent with our preliminary risk analysis. Although
these charges may be non-cash items and not have an immediate impact on our liquidity, the fact that we report charges of this
nature could contribute to negative market perceptions about us or our securities. In addition, charges of this nature may cause
us to violate net worth or other covenants to which we may be subject as a result of assuming pre-existing debt held by a target
business or by virtue of our obtaining debt financing to partially finance the initial business combination. Accordingly, any stockholders
who choose to remain stockholders following the initial business combination could suffer a reduction in the value of their shares.
Such stockholders are unlikely to have a remedy for such reduction in value unless they are able to successfully claim that the
reduction was due to the breach by our officers or directors of a duty of care or other fiduciary duty owed to them, or if they
are able to successfully bring a private claim under securities laws that the proxy solicitation or tender offer materials, as
applicable, relating to the initial business combination constituted an actionable material misstatement or omission.
If third parties bring claims against us, the proceeds held
in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.00 per
share.
Our placing of funds in the trust account
may not protect those funds from third-party claims against us. Although we seek to have all vendors, service providers, prospective
target businesses and other entities with which we do business execute agreements with us waiving any right, title, interest or
claim of any kind in or to any monies held in the trust account for the benefit of our public stockholders, such parties may not
execute such agreements, or even if they execute such agreements they may not be prevented from bringing claims against the trust
account, including, but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well
as claims challenging the enforceability of the waiver, in each case in order to gain advantage with respect to a claim against
our assets, including the funds held in the trust account. If any third party refuses to execute an agreement waiving such claims
to the monies held in the trust account, our management will perform an analysis of the alternatives available to it and will only
enter into an agreement with a third party that has not executed a waiver if management believes that such third party’s
engagement would be significantly more beneficial to us than any alternative. WithumSmith+Brown, PC, our independent registered
public accounting firm, and the underwriters of the offering, will not execute agreements with us waiving such claims to the monies
held in the trust account.
Examples of possible instances where we may
engage a third party that refuses to execute a waiver include the engagement of a third party consultant whose particular expertise
or skills are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver
or in cases where management is unable to find a service provider willing to execute a waiver. In addition, there is no guarantee
that such entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations,
contracts or agreements with us and will not seek recourse against the trust account for any reason. Upon redemption of our public
shares, if we are unable to complete our initial business combination within the prescribed timeframe, or upon the exercise of
a redemption right in connection with our initial business combination, we will be required to provide for payment of claims of
creditors that were not waived that may be brought against us within the 10 years following redemption. Accordingly, the per-share
redemption amount received by public stockholders could be less than the $10.00 per share initially held in the trust account,
due to claims of such creditors. Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third
party for services rendered or products sold to us, or a prospective target business with which we have entered into a written
letter of intent, confidentiality or similar agreement or business combination agreement, reduce the amount of funds in the trust
account to below the lesser of (i) $10.00 per public share and (ii) the actual amount per public share held in the trust account
as of the date of the liquidation of the trust account, if less than $10.00 per share due to reductions in the value of the trust
assets, less taxes payable, provided that such liability will not apply to any claims by a third party or prospective target business
who executed a waiver of any and all rights to the monies held in the trust account (whether or not such waiver is enforceable)
nor will it apply to any claims under our indemnity of the underwriters of our initial public offering against certain liabilities,
including liabilities under the Securities Act. However, we have not asked our sponsor to reserve for such indemnification obligations,
nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and believe that
our sponsor’s only assets are securities of our company. Therefore, we cannot assure you that our sponsor would be able to
satisfy those obligations. None of our officers or directors will indemnify us for claims by third parties including, without limitation,
claims by vendors and prospective target businesses.
Our directors may decide not to enforce the indemnification
obligations of our sponsor, resulting in a reduction in the amount of funds in the trust account available for distribution to
our public stockholders.
In the event that the proceeds in the trust
account are reduced below the lesser of (i) $10.00 per share and (ii) the actual amount per share held in the trust account as
of the date of the liquidation of the trust account if less than $10.00 per share due to reductions in the value of the trust assets,
in each case net of the interest which may be withdrawn to pay taxes, and our sponsor asserts that it is unable to satisfy its
obligations or that it has no indemnification obligations related to a particular claim, our independent directors would determine
whether to take legal action against our sponsor to enforce its indemnification obligations.
While we currently expect that our independent
directors would take legal action on our behalf against our sponsor to enforce its indemnification obligations to us, it is possible
that our independent directors in exercising their business judgment and subject to their fiduciary duties may choose not to do
so in any particular instance if, for example, the cost of such legal action is deemed by the independent directors to be too high
relative to the amount recoverable or if the independent directors determine that a favorable outcome is not likely. If our independent
directors choose not to enforce these indemnification obligations, the amount of funds in the trust account available for distribution
to our public stockholders may be reduced below $10.00 per share.
We may not have sufficient funds to satisfy indemnification
claims of our directors and executive officers.
We have agreed to indemnify our officers
and directors to the fullest extent permitted by law. However, our officers and directors have agreed to waive any right, title,
interest or claim of any kind in or to any monies in the trust account and to not seek recourse against the trust account for any
reason whatsoever. Accordingly, any indemnification provided will be able to be satisfied by us only if (i) we have sufficient
funds outside of the trust account or (ii) we consummate an initial business combination. Our obligation to indemnify our officers
and directors may discourage stockholders from bringing a lawsuit against our officers or directors for breach of their fiduciary
duty. These provisions also may have the effect of reducing the likelihood of derivative litigation against our officers and directors,
even though such an action, if successful, might otherwise benefit us and our stockholders. Furthermore, a stockholder’s
investment may be adversely affected to the extent we pay the costs of settlement and damage awards against our officers and directors
pursuant to these indemnification provisions.
If, after we distribute the proceeds in the trust account
to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not
dismissed, a bankruptcy court may seek to recover such proceeds, and we and our board may be exposed to claims of punitive damages.
If, after we distribute the proceeds in the
trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against
us that is not dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor and/or bankruptcy
laws as either a “preferential transfer” or a “fraudulent conveyance.” As a result, a bankruptcy court
could seek to recover all amounts received by our stockholders. In addition, our board of directors may be viewed as having breached
its fiduciary duty to our creditors and/or having acted in bad faith, thereby exposing itself and us to claims of punitive damages,
by paying public stockholders from the trust account prior to addressing the claims of creditors.
If, before distributing the proceeds in the trust account
to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not
dismissed, the claims of creditors in such proceeding may have priority over the claims of our stockholders and the per-share amount
that would otherwise be received by our stockholders in connection with our liquidation may be reduced.
If, before distributing the proceeds in the
trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against
us that is not dismissed, the proceeds held in the trust account could be subject to applicable bankruptcy law, and may be included
in our bankruptcy estate and subject to the claims of third parties with priority over the claims of our stockholders. To the extent
any bankruptcy claims deplete the trust account, the per-share amount that would otherwise be received by our stockholders in connection
with our liquidation may be reduced.
If we are deemed to be an investment company under the Investment
Company Act, we may be required to institute burdensome compliance requirements and our activities may be restricted, which may
make it difficult for us to complete our initial business combination.
If we are deemed to be an investment company
under the Investment Company Act, our activities may be restricted, including:
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restrictions on the nature of our investments; and
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restrictions on the issuance of securities, each of which
may make it difficult for us to complete our initial business combination.
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In addition, we may have imposed upon us
burdensome requirements, including:
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registration as an investment company;
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adoption of a specific form of corporate structure; and
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reporting, record keeping, voting, proxy and disclosure
requirements and other rules and regulations.
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In order not to be regulated as an investment
company under the Investment Company Act, unless we can qualify for an exclusion, we must ensure that we are engaged primarily
in a business other than investing, reinvesting or trading in securities and that our activities do not include investing, reinvesting,
owning, holding or trading “investment securities” constituting more than 40% of our total assets (exclusive of U.S.
government securities and cash items) on an unconsolidated basis. Our business will be to identify and complete an initial business
combination and thereafter to operate the post-transaction business or assets for the long term. We do not plan to buy businesses
or assets with a view to resale or profit from their resale. We do not plan to buy unrelated businesses or assets or to be a passive
investor.
We do not believe that our principal activities
subject us to the Investment Company Act. To this end, the proceeds held in the trust account may only be invested in United States
“government securities” within the meaning of Section 2(a)(16) of the Investment Company Act having a maturity of 180
days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act which
invest only in direct U.S. government treasury obligations. Pursuant to the trust agreement, the trustee is not permitted to invest
in other securities or assets. By restricting the investment of the proceeds to these instruments, and by having a business plan
targeted at acquiring and growing businesses for the long term (rather than on buying and selling businesses in the manner of a
merchant bank or private equity fund), we intend to avoid being deemed an “investment company” within the meaning of
the Investment Company Act. The trust account is intended as a holding place for funds pending the earliest to occur of: (i) the
completion of our initial business combination; (ii) the redemption of any public shares properly submitted in connection with
a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our
obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we
do not complete our initial business combination by September 19, 2021 or (B) with respect to any other provision relating to stockholders’
rights or pre-initial business combination activity; or (iii) absent an initial business combination by September 19, 2021, our
return of the funds held in the trust account to our public stockholders as part of our redemption of the public shares. If we
do not invest the proceeds as discussed above, we may be deemed to be subject to the Investment Company Act. If we were deemed
to be subject to the Investment Company Act, compliance with these additional regulatory burdens would require additional expenses
for which we have not allotted funds and may hinder our ability to complete an initial business combination or may result in our
liquidation. If we are unable to complete our initial business combination, our public stockholders may receive only approximately
$10.00 per share on the liquidation of our trust account and our warrants will expire worthless.
Changes in laws or regulations, or a failure to comply with
any laws and regulations, may adversely affect our business, including our ability to negotiate and complete our initial business
combination and results of operations.
We are subject to laws and regulations enacted
by national, regional and local governments. In particular, we are required to comply with certain SEC and other legal requirements.
Compliance with, and monitoring of, applicable laws and regulations may be difficult, time consuming and costly.
Those laws and regulations and their interpretation
and application may also change from time to time and those changes could have a material adverse effect on our business, investments
and results of operations. In addition, a failure to comply with applicable laws or regulations, as interpreted and applied, could
have a material adverse effect on our business, including our ability to negotiate and complete our initial business combination
and results of operations.
Our stockholders may be held liable for claims by third parties
against us to the extent of distributions received by them upon redemption of their shares.
Under the DGCL, stockholders may be held
liable for claims by third parties against a corporation to the extent of distributions received by them in a dissolution. The
pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event
we do not complete our initial business combination by September 19, 2021 may be considered a liquidating distribution under Delaware
law. If a corporation complies with certain procedures set forth in Section 280 of the DGCL intended to ensure that it makes reasonable
provision for all claims against it, including a 60-day notice period during which any third-party claims can be brought against
the corporation, a 90-day period during which the corporation may reject any claims brought, and an additional 150-day waiting
period before any liquidating distributions are made to stockholders, any liability of stockholders with respect to a liquidating
distribution is limited to the lesser of such stockholder’s pro rata share of the claim or the amount distributed to the
stockholder, and any liability of the stockholder would be barred after the third anniversary of the dissolution. However, it is
our intention to redeem our public shares as soon as reasonably possible following September 19, 2021 in the event we do not complete
our initial business combination and, therefore, we do not intend to comply with the foregoing procedures.
Because we will not be complying with Section
280, Section 281(b) of the DGCL requires us to adopt a plan, based on facts known to us at such time that will provide for our
payment of all existing and pending claims or claims that may be potentially brought against us within the 10 years following our
dissolution. However, because we are a blank check company, rather than an operating company, and our operations will be limited
to searching for prospective target businesses to acquire, the only likely claims to arise would be from our vendors (such as lawyers,
investment bankers, and auditors) or prospective target businesses. If our plan of distribution complies with Section 281(b) of
the DGCL, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder’s
pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would likely be
barred after the third anniversary of the dissolution. We cannot assure you that we will properly assess all claims that may be
potentially brought against us. As such, our stockholders could potentially be liable for any claims to the extent of distributions
received by them (but no more) and any liability of our stockholders may extend beyond the third anniversary of such date. Furthermore,
if the pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in
the event we do not complete our initial business combination by September 19, 2021 is not considered a liquidating distribution
under Delaware law and such redemption distribution is deemed to be unlawful (potentially due to the imposition of legal proceedings
that a party may bring or due to other circumstances that are currently unknown), then pursuant to Section 174 of the DGCL, the
statute of limitations for claims of creditors could then be six years after the unlawful redemption distribution, instead of three
years, as in the case of a liquidating distribution.
We may not hold an annual meeting of stockholders until after
the consummation of our initial business combination, which could delay the opportunity for our stockholders to elect directors.
In accordance with NASDAQ corporate governance
requirements, we are not required to hold an annual meeting until no later than one year after our first fiscal year end following
our listing on NASDAQ. Under Section 211(b) of the DGCL, we are, however, required to hold an annual meeting of stockholders
for the purposes of electing directors in accordance with our bylaws unless such election is made by written consent in lieu of
such a meeting. We may not hold an annual meeting of stockholders to elect new directors prior to the consummation of our initial
business combination, and thus we may not be in compliance with Section 211(b) of the DGCL, which requires an annual meeting. Therefore,
if our stockholders want us to hold an annual meeting prior to the consummation of our initial business combination, they may attempt
to force us to hold one by submitting an application to the Delaware Court of Chancery in accordance with Section 211(c) of the
DGCL.
We have not registered the shares of Class A common stock
issuable upon exercise of the warrants under the Securities Act or any state securities laws at this time, and such registration
may not be in place when an investor desires to exercise warrants, thus precluding such investor from being able to exercise its
warrants except on a cashless basis. If the issuance of the shares upon exercise of warrants is not registered, qualified or exempt
from registration or qualification, the holder of such warrant will not be entitled to exercise such warrant and such warrant may
have no value and expire worthless.
We have not registered the shares of Class
A common stock issuable upon exercise of the warrants issued in our initial public offering under the Securities Act or any state
securities laws at this time. However, under the terms of the warrant agreement, we have agreed that as soon as practicable, but
in no event later than 15 business days after the closing of our initial business combination, we will use our best efforts to
file with the SEC a registration statement for the registration under the Securities Act of the shares of Class A common stock
issuable upon exercise of the warrants and thereafter will use our best efforts to cause the same to become effective within 60
business days following our initial business combination and to maintain a current prospectus relating to the Class A common stock
issuable upon exercise of the warrants, until the expiration of the warrants in accordance with the provisions of the warrant agreement.
We cannot assure you that we will be able to do so if, for example, any facts or events arise which represent a fundamental change
in the information set forth in the registration statement or prospectus, the financial statements contained or incorporated by
reference therein are not current or correct or the SEC issues a stop order. If the shares issuable upon exercise of the warrants
issued in our initial public offering are not registered under the Securities Act, we will be required to permit holders to exercise
their warrants on a cashless basis. However, no warrant will be exercisable for cash or on a cashless basis, and we will not be
obligated to issue any shares to holders seeking to exercise their warrants, unless the issuance of the shares upon such exercise
is registered or qualified under the securities laws of the state of the exercising holder, or an exemption from registration is
available. Notwithstanding the foregoing, if a registration statement covering the Class A common stock issuable upon exercise
of the warrants is not effective within a specified period following the consummation of our initial business combination, warrant
holders may, until such time as there is an effective registration statement and during any period when we shall have failed to
maintain an effective registration statement, exercise warrants on a cashless basis pursuant to the exemption provided by Section
3(a)(9) of the Securities Act, provided that such exemption is available. If that exemption, or another exemption, is not available,
holders will not be able to exercise their warrants on a cashless basis. We will use our best efforts to register or qualify the
shares under applicable blue sky laws to the extent an exemption is not available. In no event will we be required to net cash
settle any warrant, or issue securities or other compensation in exchange for the warrants in the event that we are unable to register
or qualify the shares underlying the warrants issued in our initial public offering under applicable state securities laws and
there is no exemption available. If the issuance of the shares upon exercise of the warrants is not so registered or qualified
or exempt from registration or qualification, the holder of such warrant will not be entitled to exercise such warrant and such
warrant may have no value and expire worthless. In such event, holders who acquired their warrants as part of a purchase of units
will have paid the full unit purchase price solely for the shares of Class A common stock included in the units. If and when the
warrants become redeemable by us, we may not exercise our redemption right if the issuance of shares of common stock upon exercise
of the warrants is not exempt from registration or qualification under applicable state blue sky laws or we are unable to effect
such registration or qualification. We will use our best efforts to register or qualify such shares of common stock under the blue
sky laws of the state of residence in those states in which the warrants were offered by us in our initial public offering. However,
there may be instances in which holders of our public warrants may be unable to exercise such public warrants but holders of our
placement warrants may be able to exercise such placement warrants.
If you exercise your public warrants on a “cashless
basis,” you will receive fewer shares of Class A common stock from such exercise than if you were to exercise such warrants
for cash.
There are circumstances in which the exercise
of the public warrants may be required or permitted to be made on a cashless basis. First, if a registration statement covering
the shares of Class A common stock issuable upon exercise of the warrants is not effective by the 60th business day
after the closing of our initial business combination, warrant holders may, until such time as there is an effective registration
statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption.
Second, if a registration statement covering the Class A common stock issuable upon exercise of the warrants is not effective within
a specified period following the consummation of our initial business combination, warrant holders may, until such time as there
is an effective registration statement and during any period when we shall have failed to maintain an effective registration statement,
exercise warrants on a cashless basis pursuant to the exemption provided by Section 3(a)(9) of the Securities Act, provided that
such exemption is available; if that exemption, or another exemption, is not available, holders will not be able to exercise their
warrants on a cashless basis. Third, if we call the public warrants for redemption, our management will have the option to require
all holders that wish to exercise warrants to do so on a cashless basis. In the event of an exercise on a cashless basis, a holder
would pay the warrant exercise price by surrendering the warrants for that number of shares of Class A common stock equal to the
quotient obtained by dividing (x) the product of the number of shares of Class A common stock underlying the warrants, multiplied
by the difference between the exercise price of the warrants and the “fair market value” (as defined in the next sentence)
by (y) the fair market value. The “fair market value” is the average reported last sale price of the Class A common
stock for the 10 trading days ending on the third trading day prior to the date on which the notice of exercise is received by
the warrant agent or on which the notice of redemption is sent to the holders of warrants, as applicable. As a result, you would
receive fewer shares of Class A common stock from such exercise than if you were to exercise such warrants for cash.
The grant of registration rights to our initial stockholders
may make it more difficult to complete our initial business combination, and the future exercise of such rights may adversely affect
the market price of our Class A common stock.
Pursuant to an agreement entered into concurrently
with the issuance and sale of the securities in our initial public offering, our initial stockholders and their permitted transferees
can demand that we register the placement warrants, the shares of Class A common stock issuable upon exercise of the placement
warrants, the shares of Class A common stock issuable upon conversion of the founder shares, the shares of Class A common
stock included in the placement units and holders of unit that may be issued upon conversion of working capital loans may demand
that we register such Class A common stock, warrants or the Class A common stock issuable upon exercise of such units and warrants.
We will bear the cost of registering these securities. The registration and availability of such a significant number of securities
for trading in the public market may have an adverse effect on the market price of our Class A common stock. In addition, the existence
of the registration rights may make our initial business combination more costly or difficult to conclude. This is because the
stockholders of the target business may increase the equity stake they seek in the combined entity or ask for more cash consideration
to offset the negative impact on the market price of our Class A common stock that is expected when the securities owned by our
initial stockholders or holders of working capital loans or their respective permitted transferees are registered.
Because we are neither limited to evaluating a target business
in a particular industry sector nor have we selected any specific target businesses with which to pursue our initial business combination,
you will be unable to ascertain the merits or risks of any particular target business’s operations.
We will seek to complete an initial business
combination with companies in the technology industry but may also pursue other business combination opportunities, except that
we are not, under our amended and restated certificate of incorporation, permitted to effectuate our initial business combination
with another blank check company or similar company with nominal operations. Because we have not yet selected or approached any
specific target business with respect to a business combination, there is no basis to evaluate the possible merits or risks of
any particular target business’s operations, results of operations, cash flows, liquidity, financial condition or prospects.
To the extent we complete our initial business combination, we may be affected by numerous risks inherent in the business operations
with which we combine. For example, if we combine with a financially unstable business or an entity lacking an established record
of sales or earnings, we may be affected by the risks inherent in the business and operations of a financially unstable or a development
stage entity. Although our officers and directors will endeavor to evaluate the risks inherent in a particular target business,
we cannot assure you that we will properly ascertain or assess all of the significant risk factors or that we will have adequate
time to complete due diligence. Furthermore, some of these risks may be outside of our control and leave us with no ability to
control or reduce the chances that those risks will adversely impact a target business. We also cannot assure you that an investment
in our units will ultimately prove to be more favorable to investors than a direct investment, if such opportunity were available,
in a business combination target. Accordingly, any stockholders who choose to remain stockholders following our initial business
combination could suffer a reduction in the value of their securities. Such stockholders are unlikely to have a remedy for such
reduction in value unless they are able to successfully claim that the reduction was due to the breach by our officers or directors
of a duty of care or other fiduciary duty owed to them, or if they are able to successfully bring a private claim under securities
laws that the proxy solicitation or tender offer materials, as applicable, relating to the business combination contained an actionable
material misstatement or material omission.
Past performance by our management team and advisors may
not be indicative of future performance of an investment in us.
Past performance by our management team and
advisors is not a guarantee either (i) of success with respect to any business combination we may consummate or (ii) that we will
be able to locate a suitable candidate for our initial business combination. You should not rely on the historical record of our
management team’s or advisors’ performance as indicative of the future performance of an investment in the company
or the returns the company will, or is likely to, generate going forward. Additionally, in the course of their respective careers,
members of our management team have been involved in businesses and deals that were unsuccessful. Our officers and directors have
not had experience with blank check companies or special purpose acquisition companies in the past.
We may seek business combination opportunities in industries
or sectors which may or may not be outside of our management’s area of expertise.
Although we intend to focus on identifying
software and internet technology companies, we will consider an initial business combination outside of our management’s
area of expertise if an initial business combination candidate is presented to us and we determine that such candidate offers an
attractive business combination opportunity for our company or we are unable to identify a suitable candidate in this sector after
having expanded a reasonable amount of time and effort in an attempt to do so. Although our management will endeavor to evaluate
the risks inherent in any particular business combination candidate, we cannot assure you that we will adequately ascertain or
assess all of the significant risk factors. We also cannot assure you that an investment in our securities will not ultimately
prove to be less favorable to investors than a direct investment, if an opportunity were available, in an initial business combination
candidate. In the event we elect to pursue a business combination outside of the areas of our management’s expertise, our
management’s expertise may not be directly applicable to its evaluation or operation, and the information contained herein
regarding the areas of our management’s expertise would not be relevant to an understanding of the business that we elect
to acquire. As a result, our management may not be able to adequately ascertain or assess all of the significant risk factors.
Accordingly, any stockholders who choose to remain stockholders following our initial business combination could suffer a reduction
in the value of their shares. Such stockholders are unlikely to have a remedy for such reduction in value.
Although we have identified general criteria and guidelines
that we believe are important in evaluating prospective target businesses, we may enter into our initial business combination with
a target that does not meet such criteria and guidelines, and as a result, the target business with which we enter into our initial
business combination may not have attributes entirely consistent with our general criteria and guidelines.
Although we have identified general criteria
and guidelines for evaluating prospective target businesses, it is possible that a target business with which we enter into our
initial business combination will not have all of these positive attributes. If we complete our initial business combination with
a target that does not meet some or all of these guidelines, such combination may not be as successful as a combination with a
business that does meet all of our general criteria and guidelines. In addition, if we announce a prospective business combination
with a target that does not meet our general criteria and guidelines, a greater number of stockholders may exercise their redemption
rights, which may make it difficult for us to meet any closing condition with a target business that requires us to have a minimum
net worth or a certain amount of cash. In addition, if stockholder approval of the transaction is required by law, or we decide
to obtain stockholder approval for business or other legal reasons, it may be more difficult for us to attain stockholder approval
of our initial business combination if the target business does not meet our general criteria and guidelines. If we are unable
to complete our initial business combination, our public stockholders may receive only approximately $10.00 per share on the liquidation
of our trust account and our warrants will expire worthless. In certain circumstances, our public stockholders may receive less
than $10.00 per share on the redemption of their shares.
We may seek business combination opportunities with a financially
unstable business or an entity lacking an established record of revenue, cash flow or earnings, which could subject us to volatile
revenues, cash flows or earnings or difficulty in retaining key personnel.
To the extent we complete our initial business
combination with a financially unstable business or an entity lacking an established record of revenues or earnings, we may be
affected by numerous risks inherent in the operations of the business with which we combine. These risks include volatile revenues
or earnings and difficulties in obtaining and retaining key personnel. Although our officers and directors will endeavor to evaluate
the risks inherent in a particular target business, we may not be able to properly ascertain or assess all of the significant risk
factors and we may not have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our control
and leave us with no ability to control or reduce the chances that those risks will adversely impact a target business.
We are not required to obtain a fairness opinion and consequently,
you may have no assurance from an independent source that the price we are paying for the business is fair to our company from
a financial point of view.
Unless we complete our initial business combination
with an affiliated entity or our board cannot independently determine the fair market value of the target business or businesses,
we are not required to obtain an opinion from an independent investment banking firm or another independent entity that commonly
renders valuation opinions that the price we are paying is fair to our company from a financial point of view. If no opinion is
obtained, our stockholders will be relying on the judgment of our board of directors, who will determine fair market value based
on standards generally accepted by the financial community. Such standards used will be disclosed in our proxy materials or tender
offer documents, as applicable, related to our initial business combination.
We may issue additional common stock or preferred stock to
complete our initial business combination or under an employee incentive plan after completion of our initial business combination.
We may also issue shares of Class A common stock upon the conversion of the Class B common stock at a ratio greater than one-to-one
at the time of our initial business combination as a result of the anti-dilution provisions contained in our amended and restated
certificate of incorporation. Any such issuances would dilute the interest of our stockholders and likely present other risks.
Our amended and restated certificate of incorporation
authorizes the issuance of up to 100,000,000 shares of Class A common stock, par value $0.0001 per share, 10,000,000 shares of
Class B common stock, par value $0.0001 per share, and 1,000,000 shares of preferred stock, par value $0.0001 per share. There
are 46,285,000 and 1,250,000 authorized but unissued shares of Class A common stock and Class B common stock, respectively, available
for issuance, which amount takes into account the shares of Class A common stock reserved for issuance upon exercise of outstanding
warrants but not the shares of Class A common stock issuable upon conversion of Class B common stock. There are currently no shares
of preferred stock issued and outstanding. Shares of Class B common stock are convertible into shares of our Class A common
stock initially at a one-for-one ratio but subject to adjustment as set forth herein, including in certain circumstances in which
we issue Class A common stock or equity-linked securities related to our initial business combination.
We may issue a substantial number of additional
shares of common or preferred stock to complete our initial business combination or under an employee incentive plan after completion
of our initial business combination (although our amended and restated certificate of incorporation provides that we may not issue
securities that can vote with common stockholders on matters related to our pre-initial business combination activity). We may
also issue shares of Class A common stock upon conversion of the Class B common stock at a ratio greater than one-to-one at the
time of our initial business combination as a result of the anti-dilution provisions contained in our amended and restated certificate
of incorporation. However, our amended and restated certificate of incorporation provides, among other things, that prior to our
initial business combination, we may not issue additional shares of capital stock that would entitle the holders thereof to (i)
receive funds from the trust account or (ii) vote on any initial business combination. These provisions of our amended and restated
certificate of incorporation, like all provisions of our amended and restated certificate of incorporation, may be amended with
the approval of our stockholders. However, our executive officers, directors and director nominees have agreed, pursuant to a written
agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation (A) to modify
the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem
100% of our public shares if we do not complete our initial business combination by September 19, 2021 or (B) with respect to any
other provision relating to stockholders’ rights or pre-initial business combination activity, unless we provide our public
stockholders with the opportunity to redeem their shares of common stock upon approval of any such amendment at a per-share price,
payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be
net of taxes payable), divided by the number of then outstanding public shares.
The issuance of additional shares of common
or preferred stock:
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may significantly dilute the equity interest of investors;
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may subordinate the rights of holders of common stock if
preferred stock is issued with rights senior to those afforded our common stock;
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could cause a change of control if a substantial number
of shares of our common stock are issued, which may affect, among other things, our ability to use our net operating loss carry
forwards, if any, and could result in the resignation or removal of our present officers and directors; and
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may adversely affect prevailing market prices for our units,
Class A common stock and/or warrants.
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Resources could be wasted in researching business combinations
that are not completed, which could materially adversely affect subsequent attempts to locate and acquire or merge with another
business. If we are unable to complete our initial business combination, our public stockholders may receive only approximately
$10.00 per share, or less than such amount in certain circumstances, on the liquidation of our trust account and our warrants will
expire worthless.
We anticipate that the investigation of each
specific target business and the negotiation, drafting and execution of relevant agreements, disclosure documents and other instruments
will require substantial management time and attention and substantial costs for accountants, attorneys, consultants and others.
If we decide not to complete a specific initial business combination, the costs incurred up to that point for the proposed transaction
likely would not be recoverable. Furthermore, if we reach an agreement relating to a specific target business, we may fail to complete
our initial business combination for any number of reasons including those beyond our control. Any such event will result in a
loss to us of the related costs incurred which could materially adversely affect subsequent attempts to locate and acquire or merge
with another business. If we are unable to complete our initial business combination, our public stockholders may receive only
approximately $10.00 per share on the liquidation of our trust account and our warrants will expire worthless. In certain circumstances,
our public stockholders may receive less than $10.00 per share on the redemption of their shares.
Our ability to successfully effect our initial business combination
and to be successful thereafter will be totally dependent upon the efforts of our key personnel, some of whom may join us following
our initial business combination. The loss of key personnel could negatively impact the operations and profitability of our post-combination
business.
Our ability to successfully effect our initial
business combination is dependent upon the efforts of our key personnel. The role of our key personnel in the target business,
however, cannot presently be ascertained. Although some of our key personnel may remain with the target business in senior management
or advisory positions following our initial business combination, it is likely that some or all of the management of the target
business will remain in place. While we intend to closely scrutinize any individuals we employ after our initial business combination,
we cannot assure you that our assessment of these individuals will prove to be correct. These individuals may be unfamiliar with
the requirements of operating a company regulated by the SEC, which could cause us to have to expend time and resources helping
them become familiar with such requirements. In addition, the officers and directors of an initial business combination candidate
may resign upon completion of our initial business combination. The departure of an initial business combination target’s
key personnel could negatively impact the operations and profitability of our post-combination business. The role of an initial
business combination candidate’s key personnel upon the completion of our initial business combination cannot be ascertained
at this time. Although we contemplate that certain members of an initial business combination candidate’s management team
will remain associated with the initial business combination candidate following our initial business combination, it is possible
that members of the management of an initial business combination candidate will not wish to remain in place. The loss of key personnel
could negatively impact the operations and profitability of our post-combination business.
We are dependent upon our executive officers and directors and
their departure, or any illness contracted as a result of COVID-19 or otherwise, could adversely affect our ability to operate.
Our operations are dependent upon a relatively
small group of individuals and, in particular, our executive officers and directors. We believe that our success depends on the
continued service of our executive officers and directors, at least until we have completed our initial business combination. We
do not have an employment agreement with, or key-man insurance on the life of, any of our directors or executive officers. The
unexpected loss of the services of one or more of our directors or executive officers and/or advisors including due to disease
(such as COVID-19), disability or death, could have a detrimental effect on us.
Our key personnel may negotiate employment or consulting
agreements with a target business in connection with a particular business combination. These agreements may provide for them to
receive compensation following our initial business combination and as a result, may cause them to have conflicts of interest in
determining whether a particular business combination is the most advantageous.
Our key personnel may be able to remain with
the company after the completion of our initial business combination only if they are able to negotiate employment or consulting
agreements in connection with the initial business combination. Such negotiations would take place simultaneously with the negotiation
of the initial business combination and could provide for such individuals to receive compensation in the form of cash payments
and/or our securities for services they would render to us after the completion of the initial business combination. The personal
and financial interests of such individuals may influence their motivation in identifying and selecting a target business. However,
we believe the ability of such individuals to remain with us after the completion of our initial business combination will not
be the determining factor in our decision as to whether or not we will proceed with any potential business combination. There is
no certainty, however, that any of our key personnel will remain with us after the completion of our initial business combination.
We cannot assure you that any of our key personnel will remain in senior management or advisory positions with us. The determination
as to whether any of our key personnel will remain with us will be made at the time of our initial business combination.
We may have a limited ability to assess the management of
a prospective target business and, as a result, may effect our initial business combination with a target business whose management
may not have the skills, qualifications or abilities to manage a public company, which could, in turn, negatively impact the value
of our stockholders’ investment in us.
When evaluating the desirability of effecting
our initial business combination with a prospective target business, our ability to assess the target business’s management
may be limited due to a lack of time, resources or information. Our assessment of the capabilities of the target’s management,
therefore, may prove to be incorrect and such management may lack the skills, qualifications or abilities we suspected. Should
the target’s management not possess the skills, qualifications or abilities necessary to manage a public company, the operations
and profitability of the post-combination business may be negatively impacted. Accordingly, any stockholders who choose to remain
stockholders following the initial business combination could suffer a reduction in the value of their shares. Such stockholders
are unlikely to have a remedy for such reduction in value.
Our officers and directors allocate their time to other businesses
thereby causing conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest
could have a negative impact on our ability to complete our initial business combination.
Our officers and directors are not required
to, and do not, commit their full time to our affairs, which may result in a conflict of interest in allocating their time between
our operations and our search for an initial business combination and their other businesses. We do not intend to have any full-time
employees prior to the completion of our initial business combination. Each of our officers is engaged in other business endeavors
for which he may be entitled to substantial compensation and our officers are not obligated to contribute any specific number of
hours per week to our affairs. Our independent directors may also serve as officers or board members for other entities. If our
officers’ and directors’ other business affairs require them to devote substantial amounts of time to such affairs
in excess of their current commitment levels, it could limit their ability to devote time to our affairs which may have a negative
impact on our ability to complete our initial business combination.
Certain of our officers and directors are now, and all of
them may in the future become, affiliated with entities engaged in business activities similar to those intended to be conducted
by us and, accordingly, may have conflicts of interest in allocating their time and determining to which entity a particular business
opportunity should be presented.
Until we consummate our initial business
combination, we will continue to engage in the business of identifying and combining with one or more businesses. Our sponsor and
officers and directors are, and may in the future become, affiliated with entities (such as operating companies or investment vehicles)
that are engaged in a similar business, although they may not become an officer or director of, any other special purpose acquisition
companies with a class of securities registered under the Exchange Act until we have entered into a definitive agreement regarding
our initial business combination or we have liquidated the trust account.
Our officers and directors also may become
aware of business opportunities which may be appropriate for presentation to us and the other entities to which they owe certain
fiduciary or contractual duties.
Accordingly, they may have conflicts of interest
in determining to which entity a particular business opportunity should be presented. These conflicts may not be resolved in our
favor and a potential target business may be presented to another entity prior to its presentation to us. Our amended and restated
certificate of incorporation provides that we renounce our interest in any corporate opportunity offered to any director or officer
unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company
and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to
pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal
obligation.
Our officers, directors, security holders and their respective
affiliates may have competitive pecuniary interests that conflict with our interests.
We have not adopted a policy that expressly
prohibits our directors, officers, security holders or affiliates from having a direct or indirect pecuniary or financial interest
in any investment to be acquired or disposed of by us or in any transaction to which we are a party or have an interest. In fact,
we may enter into an initial business combination with a target business that is affiliated with our sponsor, our directors or
officers, although we do not intend to do so. We do not have a policy that expressly prohibits any such persons from engaging for
their own account in business activities of the types conducted by us. Accordingly, such persons or entities may have a conflict
between their interests and ours.
We may engage in an initial business combination with one
or more target businesses that have relationships with entities that may be affiliated with our sponsor, officers, directors or
existing holders which may raise potential conflicts of interest.
In light of the involvement of our sponsor,
officers and directors with other entities, we may decide to acquire one or more businesses affiliated with our sponsor, officers
or directors. Our directors also serve as officers and board members for other entities. Such entities may compete with us for
business combination opportunities. Despite our agreement to obtain an opinion from an independent investment banking firm that
is a member of FINRA or another independent entity that commonly renders valuation opinions, regarding the fairness to our stockholders
from a financial point of view of an initial business combination with one or more businesses affiliated with our officers, directors
or existing holders, potential conflicts of interest still may exist and, as a result, the terms of the initial business combination
may not be as advantageous to our public stockholders as they would be absent any conflicts of interest.
Since our sponsor, officers and directors will lose their
entire investment in us if our initial business combination is not completed, a conflict of interest may arise in determining whether
a particular business combination target is appropriate for our initial business combination.
In June 2019, our sponsor purchased an aggregate
of 7,187,500 founder shares for an aggregate purchase price of $25,000, or approximately $0.004 per share. In August and September
2019, we effected a 1.1 for 1 stock dividend and a 1.109091 for 1 stock dividend, respectively, for each share of Class B common
stock outstanding, resulting in our sponsor holding an aggregate of 8,768,750 founder shares. Because the underwriters of our initial
public offering did not exercise their over-allotment option in full, 18,750 of such shares were forfeited in September 2019. The
founder shares will be worthless if we do not complete an initial business combination. Our sponsor and Cantor purchased an aggregate
of 810,000 placement units at a price of $10.00 per unit (657,500 placement units by our sponsor and 152,500 placement units by
Cantor), for an aggregate purchase price of $8,100,000. Each placement unit consists of one share of Class A common stock and one-half
of one warrant. Each whole warrant is exercisable to purchase one whole share of common stock at $11.50 per share. These securities
will also be worthless if we do not complete an initial business combination. Holders of founder shares have agreed (A) to vote
any shares owned by them in favor of any proposed initial business combination and (B) not to redeem any founder shares in connection
with a stockholder vote to approve a proposed initial business combination. In addition, we may obtain loans from our sponsor,
affiliates of our sponsor or an officer or director. The personal and financial interests of our officers and directors may influence
their motivation in identifying and selecting a target business combination, completing an initial business combination and influencing
the operation of the business following the initial business combination.
We may issue notes or other debt securities, or otherwise
incur substantial debt, to complete an initial business combination, which may adversely affect our leverage and financial condition
and thus negatively impact the value of our stockholders’ investment in us.
Although we have no commitments as of the
date of this Report to issue any notes or other debt securities, or to otherwise incur outstanding debt, we may choose to incur
substantial debt to complete our initial business combination. We have agreed that we will not incur any indebtedness unless we
have obtained from the lender a waiver of any right, title, interest or claim of any kind in or to the monies held in the trust
account. As such, no issuance of debt will affect the per-share amount available for redemption from the trust account. Nevertheless,
the incurrence of debt could have a variety of negative effects, including:
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default and foreclosure on our assets if our operating
revenues after an initial business combination are insufficient to repay our debt obligations;
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acceleration of our obligations to repay the indebtedness
even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain
financial ratios or reserves without a waiver or renegotiation of that covenant;
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our immediate payment of all principal and accrued interest,
if any, if the debt security is payable on demand;
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our inability to obtain necessary additional financing
if the debt security contains covenants restricting our ability to obtain such financing while the debt security is outstanding;
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our inability to pay dividends on our common stock;
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using a substantial portion of our cash flow to pay principal
and interest on our debt, which will reduce the funds available for dividends on our common stock if declared, our ability to
pay expenses, make capital expenditures and acquisitions, and fund other general corporate purposes;
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limitations on our flexibility in planning for and reacting
to changes in our business and in the industry in which we operate;
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increased vulnerability to adverse changes in general economic,
industry and competitive conditions and adverse changes in government regulation;
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limitations on our ability to borrow additional amounts
for expenses, capital expenditures, acquisitions, debt service requirements, and execution of our strategy; and
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other disadvantages compared to our competitors who have
less debt.
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We may only be able to complete one business combination
with the proceeds of our initial public offering, the sale of the placement units, which will cause us to be solely dependent on
a single business which may have a limited number of services and limited operating activities. This lack of diversification may
negatively impact our operating results and profitability.
Of the net proceeds from our initial public
offering and the sale of the placement units, $351,809,163 is available to complete our initial business combination and pay related
fees and expenses (which includes up to $13,150,000, for the payment of deferred underwriting commissions).
We may effectuate our initial business combination
with a single target business or multiple target businesses simultaneously or within a short period of time. However, we may not
be able to effectuate our initial business combination with more than one target business because of various factors, including
the existence of complex accounting issues and the requirement that we prepare and file pro forma financial statements with the
SEC that present operating results and the financial condition of several target businesses as if they had been operated on a combined
basis. By completing our initial business combination with only a single entity, our lack of diversification may subject us to
numerous economic, competitive and regulatory developments. Further, we would not be able to diversify our operations or benefit
from the possible spreading of risks or offsetting of losses, unlike other entities which may have the resources to complete several
business combinations in different industries or different areas of a single industry. In addition, we intend to focus our search
for an initial business combination in a single industry. Accordingly, the prospects for our success may be:
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solely dependent upon the performance of a single business,
property or asset, or
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dependent upon the development or market acceptance of
a single or limited number of products, processes or services.
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This lack of diversification may subject
us to numerous economic, competitive and regulatory risks, any or all of which may have a substantial adverse impact upon the particular
industry in which we may operate subsequent to our initial business combination.
We may attempt to simultaneously complete business combinations
with multiple prospective targets, which may hinder our ability to complete our initial business combination and give rise to increased
costs and risks that could negatively impact our operations and profitability.
If we determine to simultaneously acquire
several businesses that are owned by different sellers, we will need for each of such sellers to agree that our purchase of its
business is contingent on the simultaneous closings of the other business combinations, which may make it more difficult for us,
and delay our ability, to complete our initial business combination. We do not, however, intend to purchase multiple businesses
in unrelated industries in conjunction with our initial business combination. With multiple business combinations, we could also
face additional risks, including additional burdens and costs with respect to possible multiple negotiations and due diligence
investigations (if there are multiple sellers) and the additional risks associated with the subsequent assimilation of the operations
and services or products of the acquired companies in a single operating business. If we are unable to adequately address these
risks, it could negatively impact our profitability and results of operations.
We may attempt to complete our initial business combination
with a private company about which little information is available, which may result in an initial business combination with a
company that is not as profitable as we suspected, if at all.
In pursuing our initial business combination
strategy, we may seek to effectuate our initial business combination with a privately held company. Very little public information
generally exists about private companies, and we could be required to make our decision on whether to pursue a potential initial
business combination on the basis of limited information, which may result in an initial business combination with a company that
is not as profitable as we suspected, if at all.
Our management may not be able to maintain control of a target
business after our initial business combination.
We may structure an initial business combination
so that the post-transaction company in which our public stockholders own shares will own less than 100% of the equity interests
or assets of a target business, but we will only complete such business combination if the post-transaction company owns or acquires
50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient
for us not to be required to register as an investment company under the Investment Company Act. We will not consider any transaction
that does not meet such criteria. Even if the post-transaction company owns 50% or more of the voting securities of the target,
our stockholders prior to the initial business combination may collectively own a minority interest in the post business combination
company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue
a transaction in which we issue a substantial number of new shares of Class A common stock in exchange for all of the outstanding
capital stock of a target. In this case, we would acquire a 100% interest in the target. However, as a result of the issuance of
a substantial number of new shares of common stock, our stockholders immediately prior to such transaction could own less than
a majority of our outstanding shares of common stock subsequent to such transaction. In addition, other minority stockholders may
subsequently combine their holdings resulting in a single person or group obtaining a larger share of the company’s stock
than we initially acquired. Accordingly, this may make it more likely that our management will not be able to maintain our control
of the target business. We cannot provide assurance that, upon loss of control of a target business, new management will possess
the skills, qualifications or abilities necessary to profitably operate such business.
We do not have a specified maximum redemption threshold.
The absence of such a redemption threshold may make it possible for us to complete an initial business combination with which a
substantial majority of our stockholders do not agree.
Our amended and restated certificate of incorporation
does not provide a specified maximum redemption threshold, except we will only redeem our public shares so long as (after such
redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial
business combination and after payment of underwriters’ fees and commissions (such that we are not subject to the SEC’s
“penny stock” rules) or any greater net tangible asset or cash requirement which may be contained in the agreement
relating to our initial business combination. As a result, we may be able to complete our initial business combination even if
a substantial majority of our public stockholders do not agree with the transaction and have redeemed their shares or, if we seek
stockholder approval of our initial business combination and do not conduct redemptions in connection with our initial business
combination pursuant to the tender offer rules, have entered into privately negotiated agreements to sell their shares to our sponsor,
officers, directors, advisors or their affiliates. In the event the aggregate cash consideration we would be required to pay for
all shares of Class A common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions
pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us, we will
not complete the initial business combination or redeem any shares, all shares of Class A common stock submitted for redemption
will be returned to the holders thereof, and we instead may search for an alternate business combination.
In order to effectuate an initial business combination, blank
check companies have, in the recent past, amended various provisions of their charters and other governing instruments, including
their warrant agreements. We cannot assure you that we will not seek to amend our amended and restated certificate of incorporation
or governing instruments in a manner that will make it easier for us to complete our initial business combination that our stockholders
may not support.
In order to effectuate an initial business
combination, blank check companies have, in the recent past, amended various provisions of their charters and modified governing
instruments, including their warrant agreements. For example, blank check companies have amended the definition of business combination,
increased redemption thresholds and extended the time to consummate an initial business combination and, with respect to their
warrants, amended their warrant agreements to require the warrants to be exchanged for cash and/or other securities. Amending our
amended and restated certificate of incorporation will require the approval of holders of 65% of our common stock, and amending
our warrant agreement will require a vote of holders of at least a majority of the public warrants (which may include public warrants
acquired by our sponsor or its affiliates in our initial public offering or thereafter in the open market). In addition, our amended
and restated certificate of incorporation requires us to provide our public stockholders with the opportunity to redeem their public
shares for cash if we propose an amendment to our amended and restated certificate of incorporation (A) to modify the substance
or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public
shares if we do not complete our initial business combination by September 19, 2021 or (B) with respect to any other provision
relating to stockholders’ rights or pre-initial business combination activity. To the extent any such amendments would be
deemed to fundamentally change the nature of any securities offered through this registration statement, we would register, or
seek an exemption from registration for, the affected securities. We cannot assure you that we will not seek to amend our charter
or governing instruments or extend the time to consummate an initial business combination in order to effectuate our initial business
combination.
The provisions of our amended and restated certificate of
incorporation that relate to our pre-business combination activity (and corresponding provisions of the agreement governing the
release of funds from our trust account), including an amendment to permit us to withdraw funds from the trust account such that
the per share amount investors will receive upon any redemption or liquidation is substantially reduced or eliminated, may be amended
with the approval of holders of 65% of our common stock, which is a lower amendment threshold than that of some other blank check
companies. It may be easier for us, therefore, to amend our amended and restated certificate of incorporation and the trust agreement
to facilitate the completion of an initial business combination that some of our stockholders may not support.
Our amended and restated certificate of incorporation
provides that any of its provisions related to pre-initial business combination activity (including the requirement to deposit
proceeds of our initial public offering and the private placement of warrants into the trust account and not release such amounts
except in specified circumstances, and to provide redemption rights to public stockholders as described herein and including to
permit us to withdraw funds from the trust account such that the per share amount investors will receive upon any redemption or
liquidation is substantially reduced or eliminated) may be amended if approved by holders of 65% of our common stock entitled to
vote thereon, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be
amended if approved by holders of 65% of our common stock entitled to vote thereon. In all other instances, our amended and restated
certificate of incorporation may be amended by holders of a majority of our outstanding common stock entitled to vote thereon,
subject to applicable provisions of the DGCL or applicable stock exchange rules. We may not issue additional securities that can
vote on amendments to our amended and restated certificate of incorporation. Our initial stockholders, who will collectively beneficially
own approximately 21.5% of our common stock, will participate in any vote to amend our amended and restated certificate of incorporation
and/or trust agreement and will have the discretion to vote in any manner they choose. As a result, we may be able to amend the
provisions of our amended and restated certificate of incorporation which govern our pre-initial business combination behavior
more easily than some other blank check companies, and this may increase our ability to complete an initial business combination
with which you do not agree. Our stockholders may pursue remedies against us for any breach of our amended and restated certificate
of incorporation.
Our sponsor, officers and directors have
agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate
of incorporation (i) to modify the substance or timing of our obligation to allow redemption in connection with our initial business
combination or to redeem 100% of our public shares if we do not complete our initial business combination by September 19, 2021
or (ii) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity,
unless we provide our public stockholders with the opportunity to redeem their shares of Class A common stock upon approval of
any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, net
of taxes payable, divided by the number of then outstanding public shares. These agreements are contained in a letter agreement
that we have entered into with our sponsor, officers and directors. Our stockholders are not parties to, or third-party beneficiaries
of, these agreements and, as a result, will not have the ability to pursue remedies against our sponsor, officers or directors
for any breach of these agreements. As a result, in the event of a breach, our stockholders would need to pursue a stockholder
derivative action, subject to applicable law.
We may be unable to obtain additional financing to complete
our initial business combination or to fund the operations and growth of a target business, which could compel us to restructure
or abandon a particular business combination.
We intend to target businesses larger than
we could acquire with the net proceeds of our initial public offering and the sale of the placement units. As a result, we may
be required to seek additional financing to complete such proposed initial business combination. We cannot assure you that such
financing will be available on acceptable terms, if at all. To the extent that additional financing proves to be unavailable when
needed to complete our initial business combination, we would be compelled to either restructure the transaction or abandon that
particular business combination and seek an alternative target business candidate. Further, the amount of additional financing
we may be required to obtain could increase as a result of future growth capital needs for any particular transaction, the depletion
of the available net proceeds in search of a target business, the obligation to repurchase for cash a significant number of shares
from stockholders who elect redemption in connection with our initial business combination and/or the terms of negotiated transactions
to purchase shares in connection with our initial business combination. If we are unable to complete our initial business combination,
our public stockholders may receive only approximately $10.00 per share plus any pro rata interest earned on the funds held in
the trust account and not previously released to us to pay our taxes on the liquidation of our trust account and our warrants will
expire worthless. In addition, even if we do not need additional financing to complete our initial business combination, we may
require such financing to fund the operations or growth of the target business. The failure to secure additional financing could
have a material adverse effect on the continued development or growth of the target business. None of our officers, directors or
stockholders is required to provide any financing to us in connection with or after our initial business combination. If we are
unable to complete our initial business combination, our public stockholders may only receive approximately $10.00 per share on
the liquidation of our trust account, and our warrants will expire worthless.
Our initial stockholders may exert a substantial influence
on actions requiring a stockholder vote, potentially in a manner that you do not support.
Our initial stockholders own shares representing
approximately 21.5% of our issued and outstanding shares of common stock (including the placement shares). Accordingly, they may
exert a substantial influence on actions requiring a stockholder vote, potentially in a manner that you do not support, including
amendments to our amended and restated certificate of incorporation and approval of major corporate transactions. If our initial
stockholders purchase any additional shares of common stock in the aftermarket or in privately negotiated transactions, this would
increase their control. Factors that would be considered in making such additional purchases would include consideration of the
current trading price of our Class A common stock. In addition, our board of directors, whose members were elected by our initial
stockholders, is divided into three classes, each of which generally serves for a term of three years with only one class of directors
being elected in each year. We may not hold an annual meeting of stockholders to elect new directors prior to the completion of
our initial business combination, in which case all of the current directors will continue in office until at least the completion
of the initial business combination. If there is an annual meeting, as a consequence of our “staggered” board of directors,
only a minority of the board of directors will be considered for election and our initial stockholders, because of their ownership
position, will have considerable influence regarding the outcome. Accordingly, our initial stockholders will continue to exert
control at least until the completion of our initial business combination.
Our sponsor paid an aggregate of $25,000 for the founder
shares, or approximately $0.003 per founder share. As a result of this low initial price, our sponsor, its affiliates and our management
team and advisors stand to make a substantial profit even if an initial business combination subsequently declines in value or
is unprofitable for our public stockholders.
As a result of the low acquisition cost of
our founder shares, our sponsor, its affiliates and our management team and advisors could make a substantial profit even if we
select and consummate an initial business combination with an acquisition target that subsequently declines in value or is unprofitable
for our public stockholders. Thus, such parties may have more of an economic incentive for us to enter into an initial business
combination with a riskier, weaker-performing or financially unstable business, or an entity lacking an established record of revenues
or earnings, than would be the case if such parties had paid the full offering price for their founder shares.
Unlike many other similarly structured blank check companies,
our initial stockholders will receive additional shares of Class A common stock if we issue shares to consummate an initial business
combination.
The founder shares will automatically convert
into Class A common stock at the time of our initial business combination, on a one-for-one basis, subject to adjustment as provided
herein. In the case that additional shares of Class A common stock, or equity-linked securities convertible or exercisable for
Class A common stock, are issued or deemed issued in excess of the amounts offered in our initial public offering and related to
the closing of the initial business combination, the ratio at which founder shares shall convert into Class A common stock will
be adjusted so that the number of Class A common stock issuable upon conversion of all founder shares will equal, in the aggregate,
on an as-converted basis, 20% of the total number of all outstanding shares of common stock upon completion of the initial business
combination, excluding the placement shares and any shares or equity-linked securities issued, or to be issued, to any seller in
the business combination and any private placement-equivalent warrants issued to our sponsor or its affiliates upon conversion
of loans made to us. This is different from most other similarly structured blank check companies in which the initial stockholder
will only be issued an aggregate of 20% of the total number of shares to be outstanding prior to the initial business combination.
Additionally, the aforementioned adjustment will not take into account any shares of Class A common stock redeemed in connection
with the business combination. Accordingly, the holders of the founder shares could receive additional shares of Class A common
stock even if the additional shares of Class A common stock, or equity-linked securities convertible or exercisable for Class A
common stock, are issued or deemed issued solely to replace those shares that were redeemed in connection with the business combination.
The foregoing may make it more difficult and expensive for us to consummate an initial business combination.
We may amend the terms of the warrants in a manner that may
be adverse to holders of public warrants with the approval by the holders of at least a majority of the then outstanding public
warrants. As a result, the exercise price of your warrants could be increased, the exercise period could be shortened and the number
of shares of our Class A common stock purchasable upon exercise of a warrant could be decreased, all without your approval.
Our warrants are issued in registered form
under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us. The warrant agreement
provides that the terms of the warrants may be amended without the consent of any holder to cure any ambiguity or correct any defective
provision, but requires the approval by the holders of at least a majority of the then outstanding public warrants to make any
change that adversely affects the interests of the registered holders of public warrants (which may include public warrants acquired
by our sponsor or its affiliates in our initial public offering or thereafter in the open market). Accordingly, we may amend the
terms of the public warrants in a manner adverse to a holder if holders of at least a majority of the then outstanding public warrants
approve of such amendment. Although our ability to amend the terms of the public warrants with the consent of at least a majority
of the then outstanding public warrants is unlimited, examples of such amendments could be amendments to, among other things, increase
the exercise price of the warrants, convert the warrants into cash or stock, shorten the exercise period or decrease the number
of shares of our Class A common stock purchasable upon exercise of a warrant.
We may redeem your unexpired warrants prior to their exercise
at a time that is disadvantageous to you, thereby making your warrants worthless.
We have the ability to redeem outstanding
warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant, provided that
the last reported sales price of our 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 commencing once
the warrants become exercisable and ending on the third trading day prior to the date on which we give proper notice of such redemption
and provided certain other conditions are met. If and when the warrants become redeemable by us, we may not exercise our redemption
right if the issuance of shares of common stock upon exercise of the warrants is not exempt from registration or qualification
under applicable state blue sky laws or we are unable to effect such registration or qualification. We will use our best efforts
to register or qualify such shares of common stock under the blue sky laws of the state of residence in those states in which the
warrants were offered by us in our initial public offering. Redemption of the outstanding warrants could force you (i) to exercise
your warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so, (ii) to sell your
warrants at the then-current market price when you might otherwise wish to hold your warrants or (iii) to accept the nominal redemption
price which, at the time the outstanding warrants are called for redemption, is likely to be substantially less than the market
value of your warrants. None of the placement warrants will be redeemable by us so long as they are held by the sponsor or its
permitted transferees.
Our warrants and founder shares may have an adverse effect
on the market price of our Class A common stock and make it more difficult to effectuate our initial business combination.
We issued warrants to purchase 17,500,000
shares of our Class A common stock as part of the units offered in our initial public offering and, simultaneously with the closing
of our initial public offering, we issued an aggregate of 405,000 placement warrants. Our initial stockholders currently own an
aggregate of 8,750,000 founder shares. The founder shares are convertible into shares of Class A common stock on a one-for-one
basis, subject to adjustment as set forth herein. In addition, if our sponsor makes any working capital loans, up to $1,500,000
of such loans may be convertible into units, at a price of $10.00 per unit at the option of the lender, upon consummation of our
initial business combination. The units would be identical to the placement units. To the extent we issue shares of Class A common
stock to effectuate an initial business combination, the potential for the issuance of a substantial number of additional shares
of Class A common stock upon exercise of these warrants and conversion rights could make us a less attractive business combination
vehicle to a target business. Any such issuance will increase the number of issued and outstanding shares of our Class A common
stock and reduce the value of the shares of Class A common stock issued to complete the initial business combination. Therefore,
our warrants and founder shares may make it more difficult to effectuate an initial business combination or increase the cost of
acquiring the target business.
The placement warrants included in the placement
units are identical to the warrants sold as part of the units in our initial public offering except that, so long as they are held
by our sponsor or its permitted transferees, (i) they will not be redeemable by us, (ii) they (including the Class A common stock
issuable upon exercise of these warrants) may not, subject to certain limited exceptions, be transferred, assigned or sold by our
sponsor until 30 days after the completion of our initial business combination and (iii) they may be exercised by the holders on
a cashless basis.
Because each unit contains one-half of one redeemable warrant
and only a whole warrant may be exercised, the units may be worth less than units of other blank check companies.
Each unit contains one-half of one redeemable
warrant. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless
you purchase at least two units, you will not be able to receive or trade a whole warrant. This is different from other offerings
similar to ours whose units include one share of common stock and one warrant to purchase one whole share. We have established
the components of the units in this way in order to reduce the dilutive effect of the warrants upon completion of an initial business
combination since the warrants will be exercisable in the aggregate for one half of the number of shares compared to units that
each contain a warrant to purchase one whole share, thus making us, we believe, a more attractive merger partner for target businesses.
Nevertheless, this unit structure may cause our units to be worth less than if they included a warrant to purchase one whole share.
A provision of our warrant agreement may make it more difficult
for use to consummate an initial business combination.
Unlike most blank check companies, if
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(i)
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we issue additional shares of Class A common stock or equity-linked
securities for capital raising purposes in connection with the closing of our initial business combination at a Newly Issued Price
of less than $9.20 per share;
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(ii)
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the aggregate gross proceeds from such issuances represent
more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination
on the date of the consummation of our initial business combination (net of redemptions), and
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(iii)
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the Market Value is below $9.20 per share,
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then the exercise price of the warrants will
be adjusted 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. This may make it more difficult for us to consummate an initial business combination with a target business.
A market for our securities and a market for our securities
may not develop, which would adversely affect the liquidity and price of our securities.
The price of our securities may vary significantly
due to one or more potential business combinations and general market or economic conditions. Furthermore, an active trading market
for our securities may never develop or, if developed, it may not be sustained. You may be unable to sell your securities unless
a market can be established and sustained.
Because we must furnish our stockholders with target business
financial statements, we may lose the ability to complete an otherwise advantageous initial business combination with some prospective
target businesses.
The federal proxy rules require that a proxy
statement with respect to a vote on an initial business combination meeting certain financial significance tests include historical
and/or pro forma financial statement disclosure in periodic reports. We will include the same financial statement disclosure in
connection with our tender offer documents, whether or not they are required under the tender offer rules. These financial statements
may be required to be prepared in accordance with, or be reconciled to, accounting principles generally accepted in the United
States of America, or GAAP, or international financial reporting standards as issued by the International Accounting Standards
Board, or IFRS, depending on the circumstances and the historical financial statements may be required to be audited in accordance
with the standards of the Public Company Accounting Oversight Board (United States), or PCAOB. These financial statements may also
be required to be prepared in accordance with GAAP in connection with our current report on Form 8-K announcing the closing of
our initial business combination within four business days following such closing. These financial statement requirements may limit
the pool of potential target businesses we may acquire because some targets may be unable to provide such financial statements
in time for us to disclose such statements in accordance with federal proxy rules and complete our initial business combination
within the prescribed time frame.
We are an emerging growth company within the meaning of the
Securities Act, and if we take advantage of certain exemptions from disclosure requirements available to emerging growth companies,
this could make our securities less attractive to investors and may make it more difficult to compare our performance with other
public companies.
We are an “emerging growth company”
within the meaning of the Securities Act, as modified by the JOBS Act, and we 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 auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced
disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements
of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously
approved. As a result, our stockholders may not have access to certain information they may deem important. We could be an emerging
growth company for up to five years, although circumstances could cause us to lose that status earlier, including if the market
value of our Class A common stock held by non-affiliates exceeds $700 million as of any June 30 before that time, in which case
we would no longer be an emerging growth company as of the following December 31. We cannot predict whether investors will find
our securities less attractive because we will rely on these exemptions. If some investors find our securities less attractive
as a result of our reliance on these exemptions, the trading prices of our securities may be lower than they otherwise would be,
there may be a less active trading market for our securities and the trading prices of our securities may be more volatile.
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 an election to opt out is irrevocable. We have 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, we, 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 our 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 accountant standards used.
Compliance obligations under the Sarbanes-Oxley Act may make
it more difficult for us to effectuate our initial business combination, require substantial financial and management resources,
and increase the time and costs of completing an initial business combination.
Section 404 of the Sarbanes-Oxley Act
requires that we evaluate and report on our system of internal controls beginning with our Annual Report on Form 10-K for the year
ending December 31, 2020. Only in the event we are deemed to be a large accelerated filer or an accelerated filer will we be required
to comply with the independent registered public accounting firm attestation requirement on our internal control over financial
reporting. Further, for as long as we remain an emerging growth company, we will not be required to comply with the independent
registered public accounting firm attestation requirement on our internal control over financial reporting. The fact that we are
a blank check company makes compliance with the requirements of the Sarbanes-Oxley Act particularly burdensome on us as compared
to other public companies because a target company with which we seek to complete our initial business combination may not be in
compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of its internal controls. The development of the internal
control of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to complete
any such business combination.
Provisions in our amended and restated certificate of incorporation
and Delaware law may inhibit a takeover of us, which could limit the price investors might be willing to pay in the future for
our Class A common stock and could entrench management.
Our amended and restated certificate of incorporation
contains provisions that may discourage unsolicited takeover proposals that stockholders may consider to be in their best interests.
These provisions include a staggered board of directors and the ability of the board of directors to designate the terms of and
issue new series of preferred shares, which may make the removal of management more difficult and may discourage transactions that
otherwise could involve payment of a premium over prevailing market prices for our securities.
We are also subject to anti-takeover provisions
under Delaware law, which could delay or prevent a change of control. Together these provisions may make the removal of management
more difficult and may discourage transactions that otherwise could involve payment of a premium over prevailing market prices
for our securities.
Our amended and restated certificate of incorporation requires,
to the fullest extent permitted by law, that derivative actions brought in our name, actions against our directors, officers, other
employees or stockholders for breach of fiduciary duty and other similar actions may be brought only in the Court of Chancery in
the State of Delaware and, if brought outside of Delaware, the stockholder bringing the suit will be deemed to have consented to
service of process on such stockholder’s counsel, which may have the effect of discouraging lawsuits against our directors,
officers, other employees or stockholders.
Our amended and restated certificate of incorporation
requires, to the fullest extent permitted by law, that derivative actions brought in our name, actions against our directors, officers,
other employees or stockholders for breach of fiduciary duty and other similar actions may be brought only in the Court of Chancery
in the State of Delaware and, if brought outside of Delaware, the stockholder bringing the suit will be deemed to have consented
to service of process on such stockholder’s counsel except any action (A) as to which the Court of Chancery in the State
of Delaware determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable
party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), (B)
which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, (C) for which the Court of
Chancery does not have subject matter jurisdiction, or (D) any action arising under the Securities Act, as to which the Court
of Chancery and the federal district court for the District of Delaware shall have concurrent jurisdiction. Any person or entity
purchasing or otherwise acquiring any interest in shares of our capital stock shall be deemed to have notice of and consented to
the forum provisions in our amended and restated certificate of incorporation. This choice of forum provision may limit a stockholder’s
ability to bring a claim in a judicial forum that it finds favorable for disputes with us or any of our directors, officers, other
employees or stockholders, which may discourage lawsuits with respect to such claims, although our stockholders will not be deemed
to have waived our compliance with federal securities laws and the rules and regulations thereunder. Alternatively, if a court
were to find the choice of forum provision contained in our amended and restated certificate of incorporation to be inapplicable
or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which
could harm our business, operating results and financial condition.
Our amended and restated certificate of incorporation
provides that the exclusive forum provision will be applicable to the fullest extent permitted by applicable law. Section 27 of
the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the
Exchange Act or the rules and regulations thereunder. As a result, the exclusive forum provision will not apply to suits brought
to enforce any duty or liability created by the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction.
Cyber incidents or attacks directed at us could result in
information theft, data corruption, operational disruption and/or financial loss.
We depend on digital technologies, including
information systems, infrastructure and cloud applications and services, including those of third parties with which we may deal.
Sophisticated and deliberate attacks on, or security breaches in, our systems or infrastructure, or the systems or infrastructure
of third parties or the cloud, could lead to corruption or misappropriation of our assets, proprietary information and sensitive
or confidential data. As an early stage company without significant investments in data security protection, we may not be sufficiently
protected against such occurrences. We may not have sufficient resources to adequately protect against, or to investigate and remediate
any vulnerability to, cyber incidents. It is possible that any of these occurrences, or a combination of them, could have adverse
consequences on our business and lead to financial loss.
If we effect our initial business combination with a company
with operations or opportunities outside of the United States, we would be subject to a variety of additional risks that may negatively
impact our operations.
If we effect our initial business combination
with a company with operations or opportunities outside of the United States, we would be subject to any special considerations
or risks associated with companies operating in an international setting, including any of the following:
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higher costs and difficulties inherent in managing cross-border
business operations and complying with different commercial and legal requirements of overseas markets;
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rules and regulations regarding currency redemption;
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complex corporate withholding taxes on individuals;
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laws governing the manner in which future business combinations
may be effected;
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tariffs and trade barriers;
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regulations related to customs and import/export matters;
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longer payment cycles and challenges in collecting accounts
receivable;
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tax issues, including but not limited to tax law changes
and variations in tax laws as compared to the United States;
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currency fluctuations and exchange controls;
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cultural and language differences;
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employment regulations;
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crime, strikes, riots, civil disturbances, terrorist attacks,
natural disasters and wars;
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deterioration of political relations with the United States;
and
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government appropriations of assets.
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We may not be able to adequately address
these additional risks. If we were unable to do so, our operations might suffer, which may adversely impact our results of operations
and financial condition.
There are risks related to the software and internet technology
industries to which we may be subject.
Business combinations with companies with
operations in the software and internet technology industries entail special considerations and risks. If we are successful in
completing a business combination with a target business with operations in the software and internet technology industries, we
will be subject to, and possibly adversely affected by, the following risks, including but not limited to:
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if we do not develop successful new products or improve
existing ones, our business will suffer;
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we may invest in new lines of business that could fail
to attract or retain users or generate revenue;
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we will face significant competition and if we are not
able to maintain or improve our market share, our business could suffer;
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disruption or failure of our networks, systems, platform
or technology that frustrate or thwart our users’ ability to access our products and services, may cause our users, advertisers,
and partners to cut back on or stop using our products and services altogether, which could seriously harm our business;
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mobile malware, viruses, hacking and phishing attacks,
spamming, and improper or illegal use of our products could seriously harm our business and reputation;
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if we are unable to successfully grow our user base and
further monetize our products, our business will suffer;
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if we are unable to protect our intellectual property,
the value of our brand and other intangible assets may be diminished, and our business may be seriously harmed;
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we may be subject to regulatory investigations and proceedings
in the future, which could cause us to incur substantial costs or require us to change our business practices in a way that could
seriously harm our business; and
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components used in our products may fail as a result of
a manufacturing, design, or other defect over which we have no control, and render our devices inoperable.
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Any of the foregoing could have an adverse
impact on our operations following a business combination. However, our efforts in identifying prospective target businesses will
not be limited to the software and internet technology industries. Accordingly, if we acquire a target business in another industry,
these risks will likely not affect us and we will be subject to other risks attendant with the specific industry in which we operate
or target business which we acquire, none of which can be presently ascertained.