NOTES TO
CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
Note 1 — Description of Organization
and Business Operations
IG Acquisition Corp. (the “Company”)
was incorporated in Delaware on July 16, 2020. The Company was formed for the purpose of entering into a merger, capital stock
exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (the “Business
Combination”).
The Company is not limited to a specific
industry or sector for purposes of consummating a Business Combination, however, the Company intends to concentrate its efforts
identifying businesses in the leisure, gaming and hospitality industry. The Company is an early stage and emerging growth company
and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies.
As of September 30, 2020, the Company had
not commenced any operations. All activity for the period from July 16, 2020 (inception) through September 30, 2020 relates to
the Company’s formation and the proposed initial public offering (“Initial Public Offering”), which is described
below. The Company will not generate any operating revenues until after the completion of a Business Combination, at the earliest.
The Company will generate non-operating income in the form of interest income from the proceeds derived from the “Initial
Public Offering”. The Company has selected December 31 as its fiscal year end.
The registration statement
for the Company’s Initial Public Offering was declared effective on September 30, 2020. On October 5, 2020, the Company consummated
the Initial Public Offering of 30,000,000 units (the “Units” and, with respect to the shares of Class A common
stock included in the Units sold, the “Public Shares”), at $10.00 per Unit, generating gross proceeds of $300,000,000,
which is described in Note 3.
Simultaneously with
the closing of the Initial Public Offering, the Company consummated the sale of 8,000,000 warrants (each, a “Private Placement
Warrant” and, collectively, the “Private Placement Warrants”) at a price of $1.00 per Private Placement Warrant
in a private placement to IG Sponsor LLC (the “Sponsor”), generating gross proceeds of $8,000,000, which is described
in Note 4.
Transaction
costs amounted to $16,997,562 consisting of $6,000,000 of underwriting fees, $10,500,000 of deferred underwriting fees and $497,562
of other offering costs. In addition, cash of $1,375,991 was held outside of the Trust Account (as defined below) on October 5,
2020 and is available for working capital purposes.
Following the closing
of the Initial Public Offering on October 5, 2020, an amount of $300,000,000 ($10.00 per Unit) from the proceeds of the sale of
the Units in the Initial Public Offering and the sale of the Private Placement Warrants was placed in a trust account (the “Trust
Account”) and invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment
Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 185 days or less, or in any open-ended
investment company that holds itself out as a money market fund meeting the conditions of Rule 2a-7 of the Investment Company Act,
as determined by the Company, until the earlier of: (i) the consummation of a Business Combination or (ii) the distribution of
the funds in the Trust Account to the Company’s stockholders, as described below.
The Company’s
management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and
the sale of the Private Placement Warrants, although substantially all of the net proceeds are intended to be applied generally
toward consummating a Business Combination. NASDAQ rules provide that the Business Combination must be with one or more target
businesses that together have a fair market value equal to at least 80% of the balance in the Trust Account (less any deferred
underwriting commissions and taxes payable on interest earned on the Trust Account) at the time of the signing a definitive agreement
to enter a Business Combination.
The Company will only
complete a Business Combination if the post-Business Combination company owns or acquires 50% or more of the outstanding voting
securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required
to register as an investment company under the Investment Company Act of 1940, as amended (the “Investment Company Act”).
There is no assurance that the Company will be able to successfully effect a Business Combination.
The Company will provide
its holders of the outstanding Public Shares (the “public stockholders”) with the opportunity to redeem all or a portion
of their Public Shares upon the completion of a Business Combination either (i) in connection with a stockholder meeting called
to approve the Business Combination or (ii) by means of a tender offer. In connection with a proposed Business Combination, the
Company may seek stockholder approval of a Business Combination or conduct a tender offer. The Company
will proceed with a Business Combination only if the Company has net tangible assets of at least $5,000,001 either immediately
prior to or upon such consummation of a Business Combination and, if the Company seeks stockholder approval, a majority of the
outstanding shares voted are voted in favor of the Business Combination.
If a stockholder vote is not required by
applicable law or stock exchange rules and the Company does not decide to hold a stockholder vote for business or other reasons,
the Company will, pursuant to its Amended and Restated Certificate of Incorporation (the “Amended and Restated Certificate
of Incorporation”), conduct the redemptions pursuant to the tender offer rules of the U.S. Securities and Exchange Commission
(“SEC”) and file tender offer documents with the SEC prior to completing a Business Combination. If, however, stockholder
approval of the transaction is required by applicable law or stock exchange rules, or the Company decides to obtain stockholder
approval for business or other reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant
to the proxy rules and not pursuant to the tender offer rules. If the Company seeks stockholder approval in connection with a Business
Combination, the Sponsor has agreed to vote its Founder Shares (as defined in Note 5), and any Public Shares purchased during or
after the Initial Public Offering in favor of approving a Business Combination. Additionally, each public stockholder may elect
to redeem their Public Shares irrespective of whether they vote for or against the proposed transaction or do not vote at all.
Notwithstanding the above,if the Company seeks stockholder approval of a Business Combination and it does not conduct redemptions
pursuant to the tender offer rules, the Company’s 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 Securities Exchange Act of 1934, as amended (the “Exchange
Act”)), will be restricted from seeking redemption rights with respect to 20% or more of the Public Shares without the Company’s
prior written consent.
The public stockholders
will be entitled to redeem their shares for a pro rata portion of the amount then in the Trust Account (initially $10.00 per share,
plus any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its
tax obligations). The per-share amount to be distributed to stockholders who redeem their shares will not be reduced by the deferred
underwriting commissions the Company will pay to the underwriter (as discussed in Note 6). There will be no redemption rights upon
the completion of a Business Combination with respect to the Company’s warrants.
If a stockholder vote
is not required and the Company does not decide to hold a stockholder vote for business or other legal reasons, the Company will,
pursuant to its Amended and Restated Certificate of Incorporation, offer such redemption pursuant to the tender offer rules of
the Securities and Exchange Commission (the “SEC”), and file tender offer documents containing substantially the same
information as would be included in a proxy statement with the SEC prior to completing a Business Combination.
The Sponsor has agreed
(a) to waive its redemption rights with respect to its Founder Shares and Public Shares held by it in connection with the
completion of a Business Combination and (b) not to propose an amendment to the Amended and Restated Certificate of Incorporation
(i) to modify the substance or timing of the Company’s obligation to allow redemption in connection with the Company’s
initial Business Combination or to redeem 100% of its Public Shares if the Company does not complete a Business Combination or
(ii) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity,
unless the Company provides the public stockholders with the opportunity to redeem their Public Shares in conjunction with any
such amendment.
If the Company is
unable to complete a Business Combination by October 5, 2022 (the “Combination Period”), the Company will (i) cease
all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but no 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 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 liquidation
distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject
to the approval of the remaining stockholders and the Company’s board of directors, proceed to commence a voluntary liquidation
and thereby a formal dissolution of the Company, subject in each case to its obligations under Delaware law to provide for claims
of creditors and the requirements of applicable law. The representative of the underwriters has agreed to waive its rights to the
deferred underwriting commission held in the Trust Account in the event the Company does not complete a Business Combination within
the Combination Period and, in such event, such amounts will be included with the funds held in the Trust Account that will be
available to fund the redemption of the Public Shares. In the event of such distribution, it is possible that the per share value
of the assets remaining available for distribution will be less than the Initial Public Offering price per Unit ($10.00).
The Sponsor has agreed that it will be
liable to the Company if and to the extent any claims by a third party for services rendered or products sold to the Company, or
a prospective target business with which the Company has discussed entering into a transaction 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 day of 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 monies held in the Trust Account (whether or not such waiver is
enforceable) nor will it apply to any claims under the Company’s indemnity of the underwriters of the Initial Public Offering
against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”).
Moreover, in the event that an executed waiver is deemed to be unenforceable
against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company
will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavouring
to have all vendors, service providers (except the Company’s independent registered public accounting firm), prospective
target businesses and other entities with which the Company does business, execute agreements with the Company waiving any right,
title, interest or claim of any kind in or to monies held in the Trust Account.
Note 2 — Summary of Significant
Accounting Policies
Basis of Presentation
The accompanying unaudited
condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States
of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article
10 of Regulation S-X of the SEC. Certain information or footnote disclosures normally included in financial statements prepared
in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial
reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial
position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed financial statements
include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial
position, operating results and cash flows for the periods presented.
The accompanying
unaudited condensed financial statements should be read in conjunction with the Company’s final prospectus for its
Initial Public Offering as filed with the SEC on October 1, 2020, as well as the Company’s Current Reports on Form 8-K,
as filed with the SEC on October 6, 2020 and October 9, 2020. The interim results for the period from July 16, 2020
(inception) through September 30, 2020 are not necessarily indicative of the results to be expected for period ended December
31, 2020 or for any future periods.
Emerging
Growth Company
The Company is an “emerging growth
company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012
(the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable
to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with
the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure
obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements
of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously
approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or
revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration
statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with
the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition
period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable.
The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised
and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the
new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s
financial statements with another public company which is neither an emerging growth company nor an emerging growth company which
has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting
standards used.
Use of Estimates
The preparation of financial statements
in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported
amounts of expenses during the reporting period.
Making estimates requires management to
exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or
set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate,
could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly
from those estimates.
Cash and Cash Equivalents
The Company considers all short-term investments
with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents
as of September 30, 2020.
Deferred Offering Costs
Deferred offering costs consist of legal,
accounting, underwriting fees and other costs incurred through the balance sheet date that are directly related to the Initial
Public Offering. Offering costs amounting to $16,997,562 were charged to stockholders’ equity upon the completion of the
Initial Public Offering. As of September 30, 2020, there was $192,031 of offering costs accrued in the accompanying condensed balance
sheet (see Note 1).
Income Taxes
The Company follows the asset and liability
method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized
for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing
assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.
The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included
the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected
to be realized.
ASC 740 prescribes a recognition threshold
and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken
in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination
by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax
expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of September 30, 2020. The
Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation
from its position. The Company is subject to income tax examinations by major taxing authorities since inception. The provision
for income taxes was deemed to be de minimis for the period from July 16, 2020 (inception) to September 30, 2020.
Net Loss Per Common Share
Net loss per share is computed by dividing
net loss by the weighted average number of shares of common stock outstanding during the period, excluding shares of common stock
subject to forfeiture by the Sponsor. Weighted average shares were reduced for the effect of an aggregate of 1,125,000 shares of
common stock that are subject to forfeiture if the over-allotment option is not exercised by the underwriters (see Note 7). At
September 30, 2020, the Company did not have any dilutive securities and other contracts that could, potentially, be exercised
or converted into shares of common stock and then share in the earnings of the Company. As a result, diluted loss per share is
the same as basic loss per share for the period presented.
Concentration of Credit Risk
Financial instruments that potentially
subject the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times, may
exceed the Federal Depository Insurance Coverage of $250,000. At September 30, 2020, the Company has not experienced losses on
this account and management believes the Company is not exposed to significant risks on such account.
Fair Value of Financial Instruments
The fair value of the Company’s assets
and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurements” approximates
the carrying amounts represented in the accompanying balance sheet, primarily due to their short-term nature.
Recent Accounting Pronouncements
Management does not believe that any recently
issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s
financial statements.
Note 3 — Initial Public Offering
Pursuant to the Initial Public Offering,
the Company sold 30,000,000 Units, at a purchase price of $10.00 per Unit. Each Unit consists of one share of Class A common
stock and one-half of one redeemable warrant (“Public Warrant”). Each whole Public Warrant entitles the holder to purchase
one share of Class A common stock at a price of $11.50 per share, subject to adjustment (see Note 7).
Note 4 — Private Placement
Simultaneously
with the closing of the Initial Public Offering, the Sponsor purchased an aggregate of 8,000,000 Private Placement Warrants at
a price of $1.00 per Private Placement Warrant, or $8,000,000 in the aggregate. The Sponsor has agreed to purchase up to an aggregate
of 8,900,000 Private Placement Warrants, at a price of $1.00 per Private Placement Warrant, or $8,900,000 in the aggregate, to
the extent the underwriters’ over-allotment option is exercised. Each Private Placement Warrant is exercisable to purchase
one share of Class A common stock at a price of $11.50 per share. A portion of the proceeds from the sale of Private Placement
Warrants were added to the net proceeds from the Initial Public Offering held in the Trust Account. If the Company does not complete
a Business Combination within the Combination Period, the proceeds from the sale of the Private Placement Warrants held in the
Trust Account will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the
Private Placement Warrants will expire worthless.
Note
5 — Related Party Transactions
Founder Shares
On July 21, 2020, the Sponsor paid $25,000
to cover certain offering costs of the Company in consideration of 8,625,000 shares of the Company’s Class B common stock
(the “Founder Shares”). The Founder Shares include an aggregate of up to 1,125,000 shares subject to forfeiture by
the Sponsor to the extent that the underwriters’ over-allotment is not exercised in full, so that the number of Founder Shares
will collectively represent approximately 20% of the Company’s issued and outstanding shares after the Initial Public Offering.
The Sponsor has agreed, subject to certain limited exceptions, not to transfer, assign or sell any of the Founder Shares until
the earlier of (A) one year after the completion of a Business Combination and (B) subsequent to a Business Combination, (x) if
the last reported sale price of the Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock
reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150
days after a Business Combination, or (y) the date on which the Company completes a liquidation, merger, stock exchange, reorganization
or other similar transaction that results in all of the Company’s stockholders having the right to exchange their shares
of Class A common stock for cash, securities or other property.
Promissory Note — Related Party
On July 21, 2020, the Sponsor issued an
unsecured promissory note to the Company (the “Promissory Note”), pursuant to which the Company may borrow up to an
aggregate principal amount of $300,000, of which $179,708 was outstanding under the Promissory Note as of September 30, 2020. The
Promissory Note is non-interest bearing and payable on the earlier of March 31, 2021 or the consummation of the Initial Public
Offering. On October 5, 2020, the Company paid the outstanding balance of the Promissory Note.
Related Party Loans
In addition, in order to finance transaction
costs in connection with a Business Combination, the Sponsor, an affiliate of the Sponsor, or certain of the Company’s officers
and directors or their affiliates may, but are not obligated to, loan the Company funds as may be required (“Working Capital
Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds
of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside
the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside
the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working
Capital Loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest,
or, at the lender’s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into warrants of the post
Business Combination entity. The warrants would be identical to the Private Placement Warrants. Except for the foregoing, the terms
of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. As
of September 30, 2020, no Working Capital Loans were outstanding.
Administrative Support Agreement
The Company entered into an agreement,
commencing on September 30, 2020 through the earlier of the Company’s consummation of a Business Combination and its liquidation,
to pay the Sponsor a total of $10,000 per month for office space, secretarial and administrative services.
Note 6 — Commitments
Risks and Uncertainties
Management is currently evaluating the
impact of the COVID-19 pandemic on the industry and has concluded that while it is reasonably possible that the virus could have
a negative effect on the Company’s financial position, results of its operations and/or search for a target company, the
specific impact is not readily determinable as of the date of these financial statements. The financial statements do not include
any adjustments that might result from the outcome of this uncertainty.
Registration Rights
Pursuant to a registration rights agreement
entered into on September 30, 2020, the holders of the Founder Shares, Private Placement Warrants and any warrants that may be
issued upon conversion of the Working Capital Loans (and any shares of Class A common stock issuable upon the exercise of the Private
Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans and upon conversion of the Founder
Shares) will be entitled to registration rights, requiring the Company to register such securities for resale (in the case of the
Founder Shares, only after conversion to shares of our Class A common stock). The holders of these securities are entitled to make
up to three demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain
“piggy-back” registration rights with respect to registration statements filed subsequent to the consummation of a
Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities
Act. The Company will bear the expenses incurred in connection with the filing of any such registration statements.
Underwriting Agreement
The Company granted the underwriters a
45-day option from the date of the Initial Public Offering to purchase up to 4,500,000 additional Units to cover over-allotments,
if any, at the Initial Public Offering price less the underwriting discounts and commissions (see Note 8).
The representative of the underwriters
is entitled to a deferred fee of $10,500,000 in the aggregate (or $12,075,000 if the over-allotment option is exercised in full).
The deferred fee will become payable to the representative of the underwriters from the amounts held in the Trust Account solely
in the event that the Company completes a Business Combination, subject to the terms of the underwriting agreement.
Note 7 — Stockholder’s Equity
Preferred Stock — The Company
is authorized to issue 1,000,000 shares of preferred stock with a par value of $0.0001 per share with such designation, rights
and preferences as may be determined from time to time by the Company’s board of directors. At September 30, 2020, there
were no shares of preferred stock issued or outstanding.
Class A Common Stock — The
Company is authorized to issue 100,000,000 shares of Class A common stock with a par value of $0.0001 per share. Holders of Class
A common stock are entitled to one vote for each share. At September 30, 2020, there were no shares of Class A common stock issued
or outstanding.
Class B Common Stock — The
Company is authorized to issue 10,000,000 shares of Class B common stock with a par value of $0.0001 per share. At September 30,
2020, there were 8,625,000 shares of Class B common stock issued and outstanding, of which an aggregate of up to 1,125,000 shares
are subject to forfeiture to the extent that the underwriters’ over-allotment option is not exercised in full or in part,
so that such shares will collectively represent 20% of the Company’s issued and outstanding common stock after the Initial
Public Offering.
Holders of Class A common stock and Class
B common stock will vote together as a single class on all matters submitted to a vote of stockholders except as required by law.
The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of a Business Combination
on a one-for-one basis, subject to adjustment. In the case that additional shares of Class A common stock or equity-linked securities
are issued or deemed issued in connection with a Business Combination, the number of shares 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 shares of Class
A common stock outstanding after such conversion (after giving effect to any redemptions of shares of Class A common stock by public
stockholders), including the total number of shares of Class A common stock issued, or deemed issued or issuable upon conversion
or exercise of any equity-linked securities or rights issued or deemed issued, by the Company in connection with or in relation
to the consummation of a Business Combination, excluding any shares of Class A common stock or equity-linked securities or rights
exercisable for or convertible into shares of Class A common stock issued, or to be issued, to any seller in a Business Combination
and any private placement warrants issued to the Sponsor, officers or directors upon conversion of Working Capital Loans, provided
that such conversion of Founder Shares will never occur on a less than one-for-one basis.
Warrants — Public Warrants
may only be exercised for a whole number of shares. No fractional warrants will be issued upon separation of the Units and only
whole warrants will trade. The Public Warrants will become exercisable on the later of (a) 12 months from the closing of the Initial
Public Offering and (b) 30 days after the completion of a Business Combination. The Company will not be obligated to deliver any
shares of Class A common stock pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise
unless a registration statement under the Securities Act with respect to the Class A common stock underlying the warrants is then
effective and a prospectus relating thereto is current, subject to the Company satisfying its obligations with respect to registration.
No warrant will be exercisable and the Company will not be obligated to issue any shares of Class A common stock upon exercise
of a warrant unless the share of Class A common stock issuable upon such warrant exercise has been registered, qualified or deemed
to be exempt under the securities laws of the state of residence of the registered holder of the warrants. The Company has agreed
that as soon as practicable, but in no event later than 15 business days after the closing of a Business Combination, it will use
its best efforts to file with the SEC a registration statement registering the registration, under the Securities Act, of the Class
A common stock issuable upon exercise of the warrants. The Company will use its best efforts to cause the same to become effective
and to maintain the effectiveness of such registration statement, and a current prospectus relating thereto, until the expiration
of the warrants in accordance with the provisions of the warrant agreement. If a registration statement covering the shares of
Class A common stock issuable upon exercise of the warrants is not effective by the sixtieth (60th) business day after the closing
of a Business Combination, warrant holders may, until such time as there is an effective registration statement and during any
period when the Company will have failed to maintain an effective registration statement, exercise warrants on a “cashless
basis” in accordance with Section 3(a)(9) of the Securities Act or another exemption. Notwithstanding the above, if the Class
A common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that it satisfies
the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at its option,
require holders of public warrants who exercise their warrants to do so on a “cashless basis” in accordance with Section
3(a)(9) of the Securities Act and, in the event the Company so elects, the Company will not be required to file or maintain in
effect a registration statement, but will use its best efforts to qualify the shares under applicable blue sky laws to the extent
an exemption is not available. Redemption of warrants for cash. Once the warrants become exercisable, the Company may call the
warrants for redemption:
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in
whole and not in part;
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at
a price of $0.01 per warrant;
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upon
not less than 30 days’ prior written notice of redemption to each warrant holder; and
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if,
and only if, the closing price of the common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock capitalizations,
reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period commencing once the warrants
become exercisable and ending three business days before we send to the notice of redemption to the warrant holders.
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If and when the warrants become redeemable
by the Company, it may exercise its redemption right even if the Company is unable to register or qualify the underlying securities
for sale under all applicable state securities laws.
If the Company calls the Public Warrants
for redemption for cash, management will have the option to require all holders that wish to exercise the Public Warrants to do
so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of shares of common
stock issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend,
or recapitalization, reorganization, merger or consolidation. However, except as described below, the warrants will not be adjusted
for issuance of common stock at a price below its exercise price. Additionally, in no event will the Company be required to net
cash settle the warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company
liquidates the funds held in the Trust Account, holders of warrants will not receive any of such funds with respect to their warrants,
nor will they receive any distribution from the Company’s assets held outside of the Trust Account with the respect to such
warrants. Accordingly, the warrants may expire worthless.
In addition, if (x) the Company issues
additional shares of Class A common stock or equity-linked securities for capital raising purposes in connection with the closing
of a Business Combination at an issue price or effective issue price of less than $9.20 per share of Class A common stock (with
such issue price or effective issue price to be determined in good faith by the Company’s board of directors and, in the
case of any such issuance to the Sponsor or its affiliates, without taking into account any Founder Shares held by the Sponsor
or such affiliates, as applicable, prior to such issuance), (the “Newly Issued Price”) (y) the aggregate gross proceeds
from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of a
Business Combination on the date of the consummation of a Business Combination (net of redemptions), and (z) the volume weighted
average trading price of the Class A common stock during the 20 trading day period starting on the trading day after the day on
which the Company consummates a Business Combination (such price, the “Market Value”) is below $9.20 per share, the
exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and
the Newly Issued Price, and the $18.00 per share redemption trigger price will be adjusted (to the nearest cent) to be equal to
180% of the higher of the Market Value and the Newly Issued Price.
The Private Placement Warrants will be
identical to the Public Warrants underlying the Units being sold in the Initial Public Offering, except that the Private Placement
Warrants and the shares of common stock issuable upon the exercise of the Private Placement Warrants will not be transferable,
assignable or saleable until 30 days after the completion of a Business Combination, subject to certain limited exceptions, and
will be entitled to certain registration rights (see Note 6). Additionally, the Private Placement Warrants will be exercisable
for cash or on a cashless basis, at the holder’s option, and be non-redeemable so long as they are held by the initial purchasers
or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their
permitted transferees, the Private Placement Warrants will be redeemable by the Company in all redemption scenarios and exercisable
by such holders on the same basis as the Public Warrants.
Note 8 — Subsequent Events
The Company evaluated subsequent events
and transactions that occurred after the balance sheet date up to the date that the condensed financial statements were issued.
Other than as described in these financial statements, the Company did not identify any subsequent events that would have required
adjustment or disclosure in the condensed financial statements.