AvePoint(AVPT) - 2019 Q3 - Quarterly Report

PART I – FINANCIAL INFORMATION Item 1. Financial Statements The unaudited financial statements show a post-IPO SPAC with no operating revenue, $351.6 million in assets, and net income from trust interest Condensed Balance Sheet The balance sheet shows total assets of $351.6 million, dominated by trust account funds, and $333.3 million of redeemable Class A common stock Condensed Balance Sheet as of September 30, 2019 | Category | Amount (USD) | | :--- | :--- | | Assets | | | Current Assets | $1,453,908 | | Cash and marketable securities held in Trust Account | $350,177,344 | | Total Assets | $351,631,252 | | Liabilities & Stockholders' Equity | | | Total Current Liabilities | $134,099 | | Deferred underwriting commissions | $13,150,000 | | Total Liabilities | $13,284,099 | | Class A common stock subject to possible redemption | $333,347,150 | | Total Stockholders' Equity | $5,000,003 | | Total Liabilities and Stockholders' Equity | $351,631,252 | Condensed Statements of Operations The company generated net income of $28,595 solely from interest earned on its trust account, offset by operating expenses Statement of Operations Highlights (Inception to Sep 30, 2019) | Description | Amount (USD) | | :--- | :--- | | Loss from operations | ($132,507) | | Interest earned on marketable securities held in Trust Account | $177,344 | | Income before provision for income taxes | $44,837 | | Provision for income taxes | ($16,242) | | Net income | $28,595 | Condensed Statement of Cash Flows Financing activities provided $351.5 million, while investing activities used $350.0 million, leaving $1.24 million in cash for operations Cash Flow Summary (Inception to Sep 30, 2019) | Activity | Net Cash Flow (USD) | | :--- | :--- | | Net cash used in operating activities | ($229,700) | | Net cash used in investing activities | ($350,000,000) | | Net cash provided by financing activities | $351,468,558 | | Net Change in Cash | $1,238,858 | Notes to Condensed Financial Statements Notes detail the company's SPAC structure, IPO proceeds, 24-month combination period, and related-party transactions with its Sponsor - The company was formed on April 5, 2019, to effect a business combination, with an intended focus on the software and internet technology industries[19][20] - On September 19, 2019, the company completed its IPO, generating gross proceeds of $350 million, which were placed in a Trust Account[22][25] - The company has until September 19, 2021 (the "Combination Period") to consummate a Business Combination, or it will be required to cease operations and liquidate[29] - The Sponsor has agreed to pay a monthly fee of $15,000 for office space, utilities, and administrative support, commencing September 16, 2019[60] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's blank check status, IPO-related activities, and financial sufficiency for its business combination search - The company is a blank check company formed on April 5, 2019, for the purpose of effecting a business combination and has not engaged in any operations to date[86][92] - Following the IPO and private placement, $350 million was placed in the Trust Account, and the company incurred $19.8 million in transaction costs, including $13.15 million in deferred underwriting fees[97] - The company has $1,238,858 in cash held outside the Trust Account for working capital purposes, intended to fund the search for and due diligence on a target business[95][100] Results of Operations Summary | Period | Net Income (USD) | Key Components | | :--- | :--- | :--- | | Three months ended Sep 30, 2019 | $29,595 | Interest income of $177,344 offset by operating costs and taxes | | Inception (Apr 5, 2019) to Sep 30, 2019 | $28,595 | Interest income of $177,344 offset by operating costs and taxes | Item 3. Quantitative and Qualitative Disclosures about Market Risk The company's market risk is minimal as trust account funds are invested in short-term U.S. government securities - The company believes there is no material exposure to interest rate risk because funds in the Trust Account are invested in short-term U.S. government treasury bills, notes, or bonds, or in certain money market funds[107] Item 4. Controls and Procedures Management concluded that disclosure controls and procedures were effective with no material changes to internal controls during the quarter - Management concluded that the company's disclosure controls and procedures were effective as of September 30, 2019[109] - There were no changes in the company's internal control over financial reporting during the most recently completed fiscal quarter that materially affected, or are reasonably likely to materially affect, internal controls[110] PART II – OTHER INFORMATION Item 1. Legal Proceedings The company reports no current legal proceedings - None[110] Item 1A. Risk Factors No material changes to the risk factors previously disclosed in the company's final prospectus have occurred - As of the date of this report, there have been no material changes to the risk factors disclosed in the company's final prospectus filed with the SEC[111] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds The company details the use of proceeds from its $350 million IPO and an $8.1 million private placement - On September 19, 2019, the company consummated its IPO of 35,000,000 Units at $10.00 per Unit, generating gross proceeds of $350,000,000[112] - Simultaneously with the IPO, the company completed a private placement of 810,000 Placement Units at $10.00 per unit, generating total proceeds of $8,100,000[113] - Of the gross proceeds from the IPO and private placement, $350,000,000 was placed in the Trust Account[115] Item 3. Defaults Upon Senior Securities The company reports no defaults upon senior securities - None[116] Item 4. Mine Safety Disclosures This section is not applicable to the company's business - Not applicable[117] Item 5. Other Information The company reports no other material information - None[117] Item 6. Exhibits This section lists key legal and financial agreements filed with the report, such as the Underwriting and Warrant Agreements - Lists key legal and financial agreements filed with the report, such as the Underwriting Agreement, Warrant Agreement, and Investment Management Trust Agreement[119]