QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) |
(Commission File Number) |
(IRS Employer Identification No.) | ||
st Street |
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(Address Of Principal Executive Offices) |
(Zip Code) |
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
one-half of one Redeemable Warrant |
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Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
Non-accelerated filer |
☒ | Smaller reporting company | ||||
Emerging growth company |
Item 1. |
Condensed Financial Statements |
Assets: |
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Current assets: |
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Cash |
$ | |||
Total current assets |
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Deferred offering costs |
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Total Assets |
$ |
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Liabilities and Stockholder’s Deficit: |
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Current liabilities: |
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Accounts payable |
$ | |||
Accrued expenses |
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Franchise tax payable |
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Note payable - related party |
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Total current liabilities |
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Stockholder’s Deficit: |
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Preferred stock, $ |
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Class A common stock, $ |
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Class B common stock, $ (1)(2) |
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Additional paid-in capital |
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Accumulated deficit |
( |
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Total stockholder’s deficit |
( |
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Total Liabilities and Stockholder’s Deficit |
$ |
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(1) |
This number includes up to |
(2) |
On July 29, 2021, the Company effected a stock split of Class B common stock, resulting in an aggregate of |
General and administrative expenses |
$ | |||
Franchise tax expenses |
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Loss from operations |
( |
) | ||
Net loss |
$ |
( |
) | |
Weighted average shares outstanding, basic and diluted (1)(2) |
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Basic and diluted net loss per share |
$ | ( |
) | |
(1) |
This number excludes an aggregate of up to |
(2) |
On July 29, 2021, the Company effected a stock split of Class B common stock, resulting in an aggregate of |
Common Stock |
Additional Paid-In Capital |
Accumulated Deficit |
Total Stockholder’s Deficit |
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Class A |
Class B |
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Shares |
Amount |
Shares |
Amount |
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Balance - April 20, 2021 (inception) |
$ |
$ |
$ |
$ |
$ |
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Issuance of Class B common stock to Sponsor (1)(2) |
— | — | — | |||||||||||||||||||||||||
Net loss |
— | — | — | — | — | ( |
) | ( |
) | |||||||||||||||||||
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Balance - June 30, 2021 (unaudited) |
— |
$ |
— |
$ |
$ |
$ |
( |
) |
$ |
( |
) | |||||||||||||||||
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(1) |
This number includes up to |
(2) |
On July 29, 2021, the Company effected a stock split of Class B common stock, resulting in an aggregate of |
Cash Flows from Operating Activities: |
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Net loss |
$ | ( |
) | |
Changes in operating assets and liabilities: |
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Accounts payable |
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Franchise tax payable |
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Net cash used in operating activities |
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Cash Flows from Financing Activities: |
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Proceeds from note payable to related party |
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Net cash provided by financing activities |
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Net increase in cash |
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Cash - beginning of the period |
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Cash - end of the period |
$ |
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Supplemental disclosure of noncash financing activities: |
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Offering costs paid by Sponsor in exchange for issuance of Class B common stock |
$ | |||
Offering costs included in accounts payable |
$ | |||
Offering costs included in accrued expenses |
$ | |||
Offering costs paid by Sponsor under promissory note |
$ | |||
• | Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets; |
• | Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and |
• | Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. |
• | in whole and not in part; |
• | at a price of $ |
• | upon a minimum of |
• | if, and only if, the closing price of Class A common stock equals or exceeds $ within a ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant holders. |
Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations. |
• | we have no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective; |
• | our ability to select an appropriate target business or businesses; |
• | our ability to complete a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses (the “Business Combination”); |
• | our expectations around the performance of a prospective target business or businesses; |
• | our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial Business Combination; |
• | our officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or in approving our initial Business Combination; |
• | our potential ability to obtain additional financing to complete our initial Business Combination; |
• | our pool of prospective target businesses; |
• | our ability to consummate an initial Business Combination due to the uncertainty resulting from the recent COVID-19 pandemic; |
• | the ability of our officers and directors to generate a number of potential Business Combination opportunities; |
• | our public securities’ potential liquidity and trading; |
• | the use of proceeds not held in the trust account or available to us from interest income on the trust account balance; |
• | the trust account not being subject to claims of third parties; |
• | our financial performance following our initial public offering (the “Initial Public Offering”); and |
• | the other risks and uncertainties discussed herein, in our filings with the SEC and in our final prospectus relating to our Initial Public Offering, filed with the SEC on September 2, 2021. |
• | may significantly dilute the equity interest of investors in our Initial Public Offering, which dilution would increase if the anti-dilution provisions in the Class B common stock resulted in the issuance of Class A common stock on a greater than one-to-one |
• | may subordinate the rights of holders of Class A common stock if preference shares are issued with rights senior to those afforded our Class A common stock; |
• | could cause a change in control if a substantial number 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. |
• | 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 Class A common stock; |
• | 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 Class A common stock if declared, expenses, capital expenditures, acquisitions and 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, execution of our strategy and other purposes and other disadvantages compared to our competitors who have less debt. |
Item 3. |
Quantitative and Qualitative Disclosures About Market Risk |
Item 4. |
Controls and Procedures |
Item 1. |
Legal Proceedings |
Item 1A. |
Risk Factors |
Item 2. |
Unregistered Sales of Equity Securities and Use of Proceeds. |
Item 3. |
Defaults upon Senior Securities |
Item 4. |
Mine Safety Disclosures. |
Item 5. |
Other Information. |
Item 6. |
Exhibits. |
* | Filed herewith. |
** | Furnished herewith. |
(1) | Incorporated by reference to the Current Report on Form 8-K of Insight Acquisition Corp. filed with the Securities and Exchange Commission on September 7, 2021 (Commission File No. 001-40775). |
(2) | Incorporated by reference to the Form S-1 of Insight Acquisition Corp. filed with the Securities and Exchange Commission on August 11, 2021 (Registration Number 333-258727). |
Dated: October 15, 2021 | INSIGHT ACQUISITION CORP. | |||||
By: | /s/ Jeff Gary | |||||
Name: | Jeff Gary | |||||
Title: | Chief Executive Officer and Chief Financial Officer |