IPO and Fundraising - The company completed its initial public offering on June 26, 2020, raising gross proceeds of $40 million from the sale of 4,000,000 units at $10.00 per unit[28]. - An additional 600,000 units were sold on June 30, 2020, generating total gross proceeds of $6.21 million, bringing the total proceeds in the trust account to $46 million[29]. - The company intends to utilize cash from the IPO and private placement, along with potential new debt, for its initial business combination[32]. Business Combination Strategy - The company has a target to complete its initial business combination within 12 months from the IPO closing, extendable to 21 months[30]. - The company seeks to acquire growth businesses with a total enterprise value between $200 million and $300 million, focusing on scalable operations[20]. - The acquisition strategy includes targeting companies with significant revenue and earnings growth potential through new product development and operational efficiencies[22]. - The company emphasizes acquiring businesses that can benefit from being publicly traded, enhancing access to capital markets[25]. - The management team aims to leverage its operational experience across various sectors, including healthcare, energy, and technology, to identify potential acquisition targets[17]. Target Business Evaluation - The management team has identified criteria for evaluating target businesses, including long-term revenue visibility and strong free cash flow generation potential[24]. - The company is open to sourcing target businesses from various financial community members, including investment bankers and private equity funds[37]. - The fair market value of the target business must equal at least 80% of the value of the trust account at the time of the agreement[43]. - The company will conduct an extensive due diligence review of prospective target businesses, which includes meetings with management and financial information review[42]. Shareholder and Approval Processes - A majority of the outstanding ordinary shares must vote in favor of the business combination for it to be approved, requiring only 789,001 of the 4,600,000 public shares to be voted in favor[62]. - Shareholder approval may not be required for certain types of transactions, such as asset purchases or stock purchases not involving a merger[51]. - The company will not redeem public shares if it would cause net tangible assets to fall below $5,000,001 immediately prior to or upon the consummation of the initial business combination[63]. Deadlines and Extensions - The company has until June 25, 2021, to consummate its initial business combination, with the possibility of extending this deadline up to three times, each by an additional three months[55]. - The company has extended the deadline to complete its initial business combination to December 25, 2021, with a total of $920,000 deposited into the trust account for this purpose[76]. - A total of $460,000 was deposited on June 22, 2021, to extend the business combination period by three months from June 25, 2021, to September 25, 2021[77]. - Another $460,000 was deposited on September 20, 2021, to further extend the period by three months from September 25, 2021, to December 25, 2021[77]. - If the initial business combination is not completed by December 25, 2021, the company will distribute the funds in the trust account to public shareholders, estimated at approximately $10.20 per share[87]. Liquidation and Redemption - The company will enter voluntary liquidation if the initial business combination is not completed, with the liquidator responsible for notifying creditors and distributing remaining assets[81]. - The company’s insiders have agreed to waive their redemption rights for founder shares if the business combination is not consummated within the specified period[82]. - The funds in the trust account may be subject to claims from creditors, which could affect the amount returned to public shareholders upon liquidation[86]. - The trust account holds approximately $504,000 as of September 30, 2021, to cover potential claims[93]. - The company aims to maintain a per-share value of at least $10.20 in the trust account, with liabilities potentially impacting this value[90]. - Shareholders can only access funds from the trust account under specific conditions, including redemption prior to a business combination by December 25, 2021[97]. Competition and Compliance - The company faces intense competition from established entities with greater resources in identifying target businesses for acquisition[98]. - The company is classified as an "emerging growth company," allowing it to take advantage of certain reporting exemptions[104]. - The company intends to comply with the Sarbanes-Oxley Act for internal control evaluations for the fiscal year ending December 31, 2021[103]. - The company may engage third parties that do not execute waivers if their expertise is deemed significantly beneficial[89]. - There is no guarantee that all vendors will execute agreements waiving claims against the trust account[91]. - The company may face legal action against its sponsor if the trust account value falls below $10.20 per share and obligations are not met[92]. Financial Reporting - The company will provide audited financial statements of prospective target businesses to shareholders as part of the acquisition process[102].
Brilliant Acquisition (BRLI) - 2020 Q4 - Annual Report