HOME PLATE ACQUISITION CORP. You should read the following discussion and analysis of our financial condition
and results of operations together with the unaudited interim condensed
consolidated financial statements and accompanying notes included in Part I,
Item 1 of this Quarterly Report on Form 10-Q and our audited consolidated
financial statements and accompanying notes included in Item 8 of our Annual
Report on Form 10-K for the fiscal year ended
This discussion may contain forward-looking statements that reflect our plans,
estimates, and beliefs that involve risks and uncertainties. As a result of many
factors, including those set forth under "Risk Factors" in Part I, Item 1A of
our Annual Report on Form 10-K for the fiscal year ended
Overview
We are a blank check company incorporated on
Our sponsor is
The issuance of additional shares in a Business Combination:
• may significantly dilute the equity interest of investors in the IPO,
which dilution would increase if the anti-dilution provisions in our
Class B common stock resulted in the issuance of our Class A common
stock on a greater than one-to-one basis upon conversion of our
Class B common stock;
• may subordinate the rights of holders of our Class A common stock if
shares of preferred stock are issued with rights senior to those
afforded our Class A common stock;
• could cause a change in control if a substantial number of shares of
our Class A 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;
• may have the effect of delaying or preventing a change of control of
us by diluting the share ownership or voting rights of a person
seeking to obtain control of us; and
• may adversely affect prevailing market prices for our Class A common
stock and/or warrants.
Similarly, if we issue debt securities, or otherwise incur significant debt, it could result in:
• default and foreclosure on our assets if our operating revenues after
an initial Business Combination are insufficient to repay our debt
obligations;
• 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;
• our immediate payment of all principal and accrued interest, if any,
if the debt is payable on demand;
• our inability to obtain necessary additional financing if the debt
contains covenants restricting our ability to obtain such financing
while the debt is outstanding;
• our inability to pay dividends on our common or preferred 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;
• limitations on our flexibility in planning for and reacting to changes
in our business and in the industry in which we operate;
• increased vulnerability to adverse changes in general economic,
industry and competitive conditions and adverse changes in government
regulation; and
• limitations on our ability to borrow additional amounts for expenses,
capital expenditures, acquisitions, debt service requirements and
execution of our strategy and other purposes and other disadvantages
compared to our competitors who have less debt.
We expect to incur significant costs in the pursuit of our initial Business Combination. We cannot assure you that our plans to raise capital or to complete our initial Business Combination will be successful.
Results of Operations and Known Trends or Future Events
We have neither engaged in any significant business operations nor generated any revenues to date. All activities to date relate to our formation and IPO. We will not generate any operating revenues until after the completion of a Business Combination, at the earliest. We will generate non-operating income in the form of interest income on cash and cash equivalents from the proceeds derived from the IPO. There has been no significant change in our financial or trading position and no material adverse change has occurred since the date of our audited financial statements. We are incurring increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses.
For the three months ended
For the three months ended
Liquidity and Capital Resources
As of
Our liquidity needs up to and through our IPO had been met through payment of
On
An aggregate of
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As of
As of
In order to fund working capital deficiencies or finance transaction costs in
connection with an intended initial business combination, our Sponsor or an
affiliate of our Sponsor or certain of our directors and officers may, but are
not obligated to, loan us funds as may be required ("Working Capital Loans"). If
we complete our initial Business Combination, we may repay such loaned amounts
out of the proceeds of the trust account released to us. Otherwise, such loans
may be repaid only out of funds held outside the trust account. In the event
that our initial Business Combination does not close, we may use a portion of
the working capital held outside the trust account to repay such loaned amounts
but no proceeds from our trust account would be used to repay such loaned
amounts. Up to
We expect our primary liquidity requirements during the period between the
consummation of our IPO and consummation of our Business Combination to include
approximately
These amounts are estimates and may differ materially from our actual expenses. In addition, we could use a portion of the funds not being placed in trust to pay commitment fees for financing, fees to consultants to assist us with our search for a target business or as a down payment or to fund a "no-shop" provision (a provision designed to keep target businesses from "shopping" around for transactions with other companies or investors on terms more favorable to such target businesses) with respect to a particular proposed Business Combination, although we do not have any current intention to do so. If we entered into an agreement where we paid for the right to receive exclusivity from a target business, the amount that would be used as a down payment or to fund a "no-shop" provision would be determined based on the terms of the specific Business Combination and the amount of our available funds at the time. Our forfeiture of such funds (whether as a result of our breach or otherwise) could result in our not having sufficient funds to continue searching for, or conducting due diligence with respect to, prospective target businesses.
Based on the foregoing, management believes that the Company will have
sufficient working capital and borrowing capacity to meet its needs through
We do not believe we will need to raise additional funds following the IPO in order to meet the expenditures required for operating our business. However, if our estimates of the costs of identifying a target business, undertaking in-depth due diligence and negotiating an initial Business Combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our initial Business Combination. Moreover, we may need to obtain additional financing either to complete our initial Business Combination either because the transaction requires more cash than is available from the proceeds held in our Trust Account, or because we become obligated to redeem a significant number of our Public Shares upon
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completion of our Business Combination, in which case we may issue additional securities or incur debt in connection with such business combination. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our Business Combination. If we do not 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, we may need to obtain additional financing in order to meet our obligations. We cannot provide any assurance that such new financing will be available to us on commercially acceptable terms, if at all.
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In connection with the Company's assessment of going concern considerations in
accordance with
Off-Balance Sheet Arrangements
As of
Commitments and Contractual Obligations
As of
The holders of our Founder Shares, Private Placement Warrants and any warrants that may be issued upon conversion of Working Capital Loans (and any 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) are entitled to registration rights pursuant to a registration rights agreement. The holders of these securities are entitled to make up to three demands, excluding short form demands, that we register such securities. In addition, the holders have certain "piggy-back" registration rights with respect to registration statements filed subsequent to the completion of our initial Business Combination. We will bear the expenses incurred in connection with the filing of any such registration statements.
Pursuant to the underwriting agreement, Jefferies, as IPO underwriter, will be
entitled to a deferred underwriting fee of
We have committed to pay up to
On
In
On
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Critical Accounting Policies and Estimates
Management's discussion and analysis of our results of operations and liquidity
and capital resources are based on our unaudited financial information. We
describe our significant accounting policies in Note 2 - Summary of Significant
Accounting Policies of the Notes to Financial Statements included in this
Quarterly Report on Form 10-Q. Our unaudited financial statements have been
prepared in accordance with
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Recent Accounting Standards
In
We do not believe that any other recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on our financial statements.
JOBS Act
The JOBS Act contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. We qualify as an "emerging growth company" under the JOBS Act and are allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We are electing to delay the adoption of new or revised accounting standards, and as a result, we may not comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As a result, our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.
Additionally, we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an "emerging growth company," we choose to rely on such exemptions we may not be required to, among other things, (i) provide an independent registered public accounting firm's attestation report on our system of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the independent registered public accounting firm's report providing additional information about the audit and the financial statements (auditor discussion and analysis), and (iv) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO's compensation to median employee compensation. These exemptions will apply for a period of five years following the completion of the IPO or until we are no longer an "emerging growth company," whichever is earlier.
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