Liquidity and Capital Resources
As of March 31, 2021, we had cash outside the trust account of $1,009,210 available for working capital needs. All remaining cash held in the trust account are
generally unavailable for the Companys use, prior to an initial business combination, and is restricted for use either in a business combination or to redeem ordinary shares. As of March 31, 2021, none of the amount in the trust account was
available to be withdrawn as described above.
Through March 31, 2021, the Companys liquidity needs were satisfied through receipt of $25,000 from
the sale of the founder shares, advances from the sponsor in an aggregate amount of $61,810 and the remaining net proceeds from the initial public offering and the sale of private placement units.
The Company anticipates that the $1,009,210 outside of the trust account as of March 31, 2021, will be sufficient to allow the Company to operate for at least
the next 12 months, assuming that a business combination is not consummated during that time. Until consummation of our business combination, the Company will be using the funds not held in the trust account, and any additional Working Capital Loans
(as defined in Note 5 to our financial statements) from the initial shareholders, the Companys officers and directors, or their respective affiliates (which is described in Note 5 to our financial statements), for identifying and evaluating
prospective acquisition candidates, performing business due diligence on prospective target businesses, traveling to and from the offices, plants or similar locations of prospective target businesses, reviewing corporate documents and material
agreements of prospective target businesses, selecting the target business to acquire and structuring, negotiating and consummating the business combination.
The Company does not believe it will need to raise additional funds in order to meet the expenditures required for operating its business. However, if the
Companys estimates of the costs of undertaking in-depth due diligence and negotiating business combination is less than the actual amount necessary to do so, the Company may have insufficient
funds available to operate its business prior to the business combination. Moreover, the Company will need to raise additional capital through loans from its sponsor, officers, directors, or third parties. None of the sponsor, officers or directors
are under any obligation to advance funds to, or to invest in, the Company. If the Company is unable to raise additional capital, it may be required to take additional measures to conserve liquidity, which could include, but not necessarily be
limited to, curtailing operations, suspending the pursuit of its business plan, and reducing overhead expenses. The Company cannot provide any assurance that new financing will be available to it on commercially acceptable terms, if at all.
Off-Balance Sheet Arrangements
We have no obligations,
assets or liabilities, which would be considered off-balance sheet arrangements as of March 31, 2021. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as
variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed
any debt or commitments of other entities, or purchased any non-financial assets.
Contractual obligations
We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities, other than an agreement to pay an affiliate
of our Sponsor a monthly fee of $10,000 for office space, utilities and administrative support provided to the Company. We began incurring these fees on October 23, 2020 and will continue to incur these fees monthly until the earlier of the
completion of the initial Business Combination and the Companys liquidation.
The underwriter is entitled to deferred commissions of $0.35 per unit
of the gross proceeds from the Units sold in the IPO, or $7,000,000 in the aggregate. The deferred commissions will become payable to the underwriter from the amounts held in the Trust Account solely in the event that we complete a Business
Combination, subject to the terms of the underwriting agreement.
Critical Accounting Policies and Estimates
Managements 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 report. Our unaudited financial statements have been prepared in
accordance with accounting principles generally accepted in the United States of America (GAAP). Certain of our accounting policies require that management apply significant judgments in defining the appropriate assumptions integral to
financial estimates. On an ongoing basis, management reviews the accounting policies, assumptions, estimates and judgments to ensure that our financial statements are presented fairly and in accordance with GAAP. Judgments are based on historical
experience, terms of existing contracts, industry trends and information available from outside sources, as appropriate. However, by their nature, judgments are subject to an inherent degree of uncertainty, and, therefore, actual results could
differ from our estimates.
Warrant Accounting
Pursuant to Accounting Standards Codification Subtopic 815-40 the Company classifies its warrants as derivative liabilities in its financial statements. Under
this accounting treatment, the Company is required to measure the fair value of the warrants at the end of each reporting period and recognize changes in the fair value from the prior period in the Companys operating results for the current
period.
Item 3.
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Quantitative and Qualitative Disclosures About Market Risk
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As of the period ended March 31, 2021, we were not subject to any market or interest rate risk. Following the consummation of our IPO, the net proceeds of our
IPO, including amounts deposited in the trust account, may be invested in U.S. government treasury bills, notes or bonds with a maturity of 185 days or less, or in certain money market funds that invest solely in U.S. treasuries. Due to the
short-term nature of these investments, we believe there will be no associated material exposure to interest rate risk when and if the net proceeds are invested in such securities.
Item 4.
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Controls and Procedures
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Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed
or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SECs rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed
to ensure that information required to be disclosed in Company reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely
decisions regarding required disclosure.
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