POPULATION HEALTH INVESTMENT CO., INC. Management report and analysis of the financial situation and operating results. (Form 10-Q)
References to “we”, “us”, “our” or the “Company” must
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Our forward-looking statements include, but are not limited to, statements regarding our or our management team's expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "plan," "possible," "potential," "predict," "project," "should," "would" and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this Quarterly Report on Form 10-Q may include, for example, statements about: • our ability to select an appropriate target business or businesses; • our ability to complete our initial business combination; • our expectations around the performance of the 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 our initial business combination due to the uncertainty resulting from the ongoing COVID-19 pandemic and other events (such as terrorist attacks, natural disasters or other significant outbreaks of infectious diseases); • the ability of our officers and directors to generate a number of potential acquisition opportunities; • our public securities' potential liquidity and trading; • the lack of a market for our securities; • the use of proceeds not held in the trust account or available to us from interest income on the trust account balance; • the proceeds from the sale of the Forward Purchase Units (as defined below) being available to us; • the trust account not being subject to claims of third parties; or • our financial performance in the future.
The forward-looking statements contained in this Quarterly Report on Form 10-Q are based on our current expectations and beliefs regarding future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those anticipated by us. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to differ materially from those expressed or implied by such forward-looking statements. Factors which could cause or contribute to such a discrepancy include, but are not limited to, those described under the heading “Risk Factors” in our other
We are a blank check company incorporated on
Our sponsor is
exempt company. Our registration statement for the IPO became effective on
Concurrently with the closing of the Initial Public Offering, we completed the private placement (“Private Placement”) of 3,633,333 warrants (each, a “Private Placement Warrant” and collectively, the “Private Placement Warrants” ), at the price of
Upon the closing of the Initial Public Offering and the Private Placement,
$172.5 million( $10.00per Unit) of the net proceeds of the Initial Public Offering and certain of the proceeds of the Private Placement were placed in a Trust Account, located in the United Stateswith Continental Stock Transfer & Trust Companyacting as trustee, and invested only in U.S."government securities" within the meaning of Section 2(a)(16) of the Investment Company Act having a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act which invest only in direct U.S.government treasury obligations, as determined by the Company, until the earlier of: (i) the completion of a Business Combination and (ii) the distribution of the Trust Account as described below.
Our management has broad discretion with respect to the specific application of the net proceeds from the IPO and the sale of Private Placement Warrants, although substantially all of the net proceeds are for be applied generally to the effect of a business combination.
If we have not completed a Business Combination within 24 months from the closing of the Initial Public Offering, or
November 20, 2022(the "Combination Period"), we will (i) cease all operations except for the purpose of winding up; (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned on the funds held in the Trust Account and not previously released to the Company to pay its income taxes, if any (less up to $100,000of interest to pay dissolution expenses), divided by the number of the then-outstanding Public Shares, which redemption will completely extinguish Public Shareholders' rights as shareholders (including the right to receive further liquidation distributions, if any); and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the remaining shareholders and the board of directors, liquidate and dissolve, subject in the case of clauses (ii) and (iii) to the Company's obligations under Cayman Islandslaw to provide for claims of creditors and the requirements of other applicable law.
Liquidity and going concern
Prior to the completion of the IPO, our liquidity needs had been met by an inflow of
As part of the Company’s assessment of going concern considerations in accordance with FASB Accounting Standards Update (“ASU”) 2014-15, “Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern”, management has determined that the liquidity condition, the date of the judicial liquidation and subsequent dissolution as well as an operating deficit raise substantial doubts about the Company’s ability to continue as a going concern. No adjustments have been made to the carrying values of assets or liabilities if the Company were to liquidate after
Management continues to assess the impact of the COVID-19 pandemic on the industry and has concluded that while it is reasonably possible that the virus could have an adverse effect on our financial condition, results of operations and/ or the search for a target company, the specific impact is not readily determinable at the date of the financial statements included in this report. The summary financial statements included in this report do not include any adjustments that may result from the outcome of this uncertainty.
All our activity since its creation until
For the three months ended
For the three months ended
Registration and rights of shareholders
Holders of Founder Shares, Private Placement Warrants, Class A common stock underlying the Private Placement Warrants and warrants issuable upon conversion of the Working Capital Loans (and any Class A common stock issuable upon exercise of the Private Placement Warrants and warrants issuable upon conversion of working capital loans) are entitled to registration rights under a recording rights agreement. Holders of these securities have the right to make up to three requests, excluding simplified requests, that we register these securities. Such holders will be entitled to certain registration fees on demand and “piggyback”. We will pay for expenses incurred in filing such registration statements.
We granted the underwriters a 45-day option from the final prospectus relating to the Initial Public Offering to purchase up to 2,250,000 additional Units to cover over-allotments, if any, at the Initial Public Offering price less the underwriting discounts and commissions. On
November 20, 2020, the underwriters fully exercised their over-allotment option. 21
Subscribers were entitled to a subscription discount of
Significant Accounting Policies and Estimates
The preparation of financial statements in accordance with accounting principles generally accepted in
the United States of Americarequires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. A summary of our significant accounting policies is included in Note 2 to our condensed financial statements in Part I, Item 1 of this Quarterly Report. Certain of our accounting policies are considered critical, as these policies are the most important to the depiction of our condensed financial statements and require significant, difficult or complex judgments, often employing the use of estimates about the effects of matters that are inherently uncertain. Such policies are summarized in the Management's Discussion and Analysis of Financial Condition and Results of Operations section in our 2021 Annual Report on Form 10-K filed with the SECon March 30, 2022. There have been no significant changes in the application of our critical accounting policies during the three months ended March 31, 2022.
Recent accounting pronouncements
See note 2 of the unaudited summary financial statements included in part I, point 1 of this quarterly report for a discussion of recent accounting pronouncements.
The Jumpstart Our Business Startups Act of 2012 (the "JOBS Act") contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. We qualify as an "emerging growth company" and under the JOBS Act will be 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 unaudited condensed 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, (a) provide an auditor's attestation report on our system of internal controls over financial reporting pursuant to Section 404 of the JOBS Act, (b) 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, (c) comply with any requirement that may be adopted by the Public Company Accounting and Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor's report providing additional information about the audit and the unaudited condensed financial statements (auditor discussion and analysis) and (d) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of our Chief Executive Officer's compensation to median employee compensation. These exemptions will apply for a period of five years following the IPO Closing Date or until we are no longer an "emerging growth company," whichever is earlier.
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