The accompanying notes are an integral part of
the unaudited condensed financial statements.
The accompanying notes are an integral part of
the unaudited condensed financial statements.
The accompanying notes are an integral part of
the unaudited condensed financial statements.
The accompanying notes are an integral part of
the unaudited condensed financial statements.
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2022
(Unaudited)
NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS
OPERATIONS
Thrive Acquisition Corporation (the “Company”)
was incorporated as a Cayman Islands exempted company on April 27, 2021. The Company was formed for the purpose of effecting a merger,
share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses that the
Company has not yet identified (the “Initial Business Combination”).
The Company is not limited to a particular industry
or sector for purposes of consummating a Business Combination. The Company is an early stage and emerging growth company and, as such,
the Company is subject to all of the risks associated with early stage and emerging growth companies.
As of March 31, 2022, the Company had not
commenced any operations. All activity for the period from April 27, 2021 (inception) through December 31, 2021 relates to the Company’s
formation and the initial public offering (“Initial Public Offering”), which is described below. The Company will not generate
any operating revenues until after the completion of its Initial Business Combination, at the earliest. The Company will generate non-operating
income in the form of interest income from the proceeds derived from the Initial Public Offering.
The registration statement for the Company’s
Initial Public Offering was declared effective on October 20, 2021. On October 25, 2021 the Company consummated the Initial Public
Offering of 17,250,000 units (the “Units” and, with respect to the Class A ordinary share included in the Units sold,
the “Public Shares”), which includes the full exercise by the underwriter of its over-allotment option in the amount of 2,250,000
Units, at $10.00 per Unit, generating gross proceeds of $172,500,000 which is described in Note 4.
Simultaneously with the closing of the Initial
Public Offering, the Company consummated the sale of an aggregate 9,150,000 warrants (the “Private Placement Warrants”) at
a price of $1.00 per Private Placement Warrant in a private placement to our Sponsor, GR Sleep LLC and Charles Urbain, generating gross
proceeds of $9,150,000, which is described in Note 5.
Transaction costs amounted to $16,408,042, consisting
of $3,450,000 of underwriting discounts and commissions, $6,037,500 of deferred underwriting fees, $585,328 of other offering costs, and
$6,335,214 excess fair value of anchor investor shares.
Following the closing of the Initial Public Offering
on October 25, 2021, an amount of $175,950,000 ($10.20 per Unit) from the net proceeds of the sale of the Units in the Initial Public
Offering and the sale of the Private Placement Warrants was placed in a Trust Account (the “Trust Account”), located in the
United States and will be invested only in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the
Investment Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 185 days or less or in
any open-ended investment company that holds itself out as a money market fund selected by the Company meeting certain conditions of Rule 2a-7
of the Investment Company Act, as determined by the Company, until the earlier of: (i) the completion of a Business Combination and
(ii) the distribution of the funds held in the Trust Account, as described below.
The Company’s management has broad discretion
with respect to the specific application of the net proceeds of the Initial Public Offering, although substantially all the net proceeds
of the Initial Public Offering are intended to be generally applied toward consummating an Initial Business Combination. The Initial Business
Combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the assets
held in the Trust Account (excluding the deferred underwriting commissions and taxes payable on income earned on the Trust Account) at
the time of the agreement to enter the Initial Business Combination. Furthermore, there is no assurance that the Company will be able
to successfully effect an Initial Business Combination.
THRIVE ACQUISITION CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2022
(Unaudited)
The Company will provide the holders of the outstanding
Public Shares (the “Public Shareholders”) with the opportunity to redeem all or a portion of their Public Shares upon the
completion of a Business Combination either (i) in connection with a shareholder meeting called to approve the Business Combination
or (ii) by means of a tender offer. The decision as to whether the Company will seek shareholder approval of the Initial Business
Combination or will allow shareholders to sell their Public Shares in a tender offer will be made by the Company, solely in its discretion,
and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would otherwise
require the Company to seek shareholder approval, unless a vote is required by law or under NASDAQ rules. If the Company seeks shareholder
approval, it will complete its Initial Business Combination only if a majority of the outstanding ordinary shares voted are voted in favor
of the Initial Business Combination. In such case, the Company would not proceed with the redemption of its Public Shares and the related
Initial Business Combination, and instead may search for an alternate Initial Business Combination.
The Company will only proceed with a Business Combination
if the Company has net tangible assets of at least $5,000,001 following any related redemptions and, if the Company seeks shareholder
approval, a majority of the shares voted are voted in favor of the Business Combination. If a shareholder vote is not required by applicable
law or stock exchange listing requirements and the Company does not decide to hold a shareholder vote for business or other reasons, the
Company will, pursuant to its Amended and Restated Memorandum and Articles of Association (the “Memorandum and Articles of Association”),
conduct the redemptions pursuant to the tender offer rules of the U.S. Securities and Exchange Commission (“SEC”) and file
tender offer documents with the SEC prior to completing a Business Combination. If, however, shareholder approval of the transaction is
required by applicable law or stock exchange listing requirements, or the Company decides to obtain shareholder approval for business
or other reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not
pursuant to the tender offer rules. If the Company seeks shareholder approval in connection with a Business Combination, the Sponsor and
each member of the Company’s management team, directors and special advisor have agreed to vote its Founder Shares (as defined in
Note 5) and any Public Shares purchased during or after the Initial Public Offering in favor of approving a Business Combination. Additionally,
each Public Shareholder may elect to redeem their Public Shares without voting, and if they do vote, irrespective of whether they vote
for or against the proposed transaction.
Notwithstanding the foregoing, if the Company
seeks shareholder approval of a Business Combination and it does not conduct redemptions in connection with its Initial Business Combination
pursuant to the tender offer rules, the Memorandum and Articles of Association provides that a Public Shareholder, together with any affiliate
of such shareholder or any other person with whom such shareholder is acting in concert or as a “group” (as defined under
Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares
sold in our Initial Public Offering without our prior consent.
The Sponsor and each member of the Company’s
management team, directors and special advisor have agreed to waive their redemption rights with respect to any Founder Shares and Public
Shares held by them in connection with (i) the completion of the Initial Business Combination and (ii) a shareholder vote to approve an
amendment to the Memorandum and Articles of Association (A) that would modify the substance or timing of the Company’s obligation
to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with the Initial Business Combination
or to redeem 100% of its Public Shares if the Company does not complete a Business Combination within the Combination Period (as defined
below) or (B) with respect to any other provision relating to the rights of holders of the Class A ordinary shares. However, if the Sponsor
or any of the Company’s directors, officers or affiliates acquires Class A ordinary shares in or after the Initial Public Offering,
they will be entitled to liquidating distributions from the Trust Account with respect to such shares if the Company fails to complete
the Initial Business Combination within the Combination Period.
The Company will have until January 25, 2023
to complete a Business Combination (or April 25, 2023 if the Company extends the time to complete a business combination so long as the
Sponsor or its affiliates or designees deposits into the Trust Account an additional $0.10 per unit) (the “Combination Period”).
If the Company has not completed a Business Combination within the Combination Period, the Company will (i) cease all operations except
for the purpose of winding up, (ii) as promptly as reasonably possible but no more than ten business days thereafter subject to lawfully
available funds therefor, 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 and not previously released to pay the Company’s franchise and income taxes (less
up to $100,000 of interest to pay dissolution expenses and net of taxes payable), divided by the number of then outstanding Public Shares,
which redemption will completely extinguish public shareholder’s rights as shareholders (including the right to receive further
liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption,
subject to the approval of the Company’s remaining shareholders and the Company’s board of directors, dissolve and liquidate,
subject in each case to the Company’s obligations under Cayman Islands law to provide for claims of creditors and the requirements
of other applicable law. There will be no redemption rights or liquidating distributions with respect to the Company’s warrants,
which will expire worthless if the Company fails to complete a Business Combination within the Combination Period.
THRIVE ACQUISITION CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2022
(Unaudited)
In order to protect the amounts held in the Trust
Account, the Sponsor has agreed to be liable to the Company if and to the extent any claims by a third party for services rendered or
products sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement,
reduce the amount of funds in the Trust Account to below (1) $10.20 per Public Share or (2) such lesser amount per Public Share held in
the Trust Account as of the date of the liquidation of the Trust Account due to reductions in the value of the trust assets, in each case
net of the interest which may be withdrawn to pay franchise and income taxes. This liability will not apply with respect to claims by
a third party who executed a waiver of any and all rights to seek access to the Trust Account and except as to any claims under the Company’s
indemnity of the underwriter of the Proposed Public Offering against certain liabilities, including liabilities under the Securities Act
of 1933, as amended (the “Securities Act”). Moreover, in the event that an executed waiver is deemed to be unenforceable against
a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company will seek to
reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all
vendors, service providers (except the Company’s independent registered public accounting firm), prospective target businesses and
other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of
any kind in or to monies held in the Trust Account.
Liquidity and Going Concern
As of March 31, 2022, the Company had approximately
$332,648 in cash and working capital of $754,937. The Company’s liquidity needs through March 31, 2022 and prior to the consummation
of the Initial Public Offering were satisfied through the proceeds of $25,000 from the Sponsor to purchase Founders Shares, and loan proceeds
from the Sponsor of $300,000 under the Note (Note 6). The Company repaid the Note in full on October 25, 2021. Subsequent to the consummation
of the Initial Public Offering, the Company’s liquidity has been satisfied through the net proceeds from the consummation of the
Initial Public Offering and the Private Placement held outside of the Trust Account.
The Company has incurred and expects to continue to incur significant
costs in pursuit of its financing and acquisition plans through the Combination Period, which is within 12 months from the issuance of
these financial statements. However, if our estimate of the costs of identifying a target business, undertaking in-depth due diligence
and negotiating an Initial Business Combination are less than the actual amount necessary to do so, we may have insufficient funds available
to operate our business prior to our Initial Business Combination. The Company will need to raise additional capital through loans or
additional investments from its Sponsor, shareholders, officers, directors, or third parties. The Company’s officers, directors
and Sponsor may, but are not obligated to, loan the Company funds, from time to time or at any time, in whatever amount they deem reasonable
in their sole discretion, to meet the Company’s working capital needs. Accordingly, the Company may not be able to obtain additional
financing. 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 a potential transaction, 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. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.
Risks and Uncertainties
The Company continues to evaluate the impact of
the COVID-19 pandemic on the industry and has concluded that while it is reasonably possible that the virus could have a negative effect
on the Company’s financial position, results of its operations, and/or search for a target company, the specific impact is not readily
determinable as of the date of these condensed financial statements. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
THRIVE ACQUISITION CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2022
(Unaudited)
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited condensed financial
statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”)
for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the SEC. Certain
information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or
omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information
and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management,
the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are
necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented.
The accompanying unaudited condensed financial
statements should be read in conjunction with the Company’s prospectus for its Initial Public Offering as filed with the SEC on
October 22, 2021, as well as the Company’s Current Report on Form 8-K, as filed with the SEC on November 2, 2021 and the Company’s
Annual Report filed on Form 10-K as filed with the SEC on March 31, 2022. The interim results for the three months ended March 31, 2022
are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or for any future periods.
Emerging Growth Company
The Company is an “emerging growth company,”
as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”),
and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that
are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements
of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in its periodic reports
and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder
approval of any golden parachute payments not previously approved.
Section 102(b)(1) of the JOBS Act exempts emerging
growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those
that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the
Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that an emerging growth
company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies
but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means
that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging
growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison
of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth
company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting
standards used.
Use of Estimates
The preparation of financial statements in conformity
with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during
the reporting period.
Making estimates requires management to exercise
significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances
that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near
term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.
THRIVE ACQUISITION CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2022
(Unaudited)
Cash and Cash Equivalents
The Company considers all short-term investments
with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents
as of March 31, 2022 and December 31, 2021. The amount held in the Trust Account is comprised of investments in U.S. Treasury Bills. The
Company accounts for its securities held in the trust account in accordance with the guidance in ASC Topic 320 “Debt and Equity
Securities” (“ASC Topic 320”). These securities are classified as trading securities with unrealized gains/losses recognized
through net income.
Offering Costs
The Company complies with the requirements of
the ASC 340-10-S99-1 and SEC Staff Accounting Bulletin (“SAB”) Topic 5A— “Expenses of Offering”. Offering
costs consist principally of professional and registration fees incurred through the balance sheet date that are related to the Initial
Public Offering. Offering costs are charged to shareholders’ equity or the statement of operations based on the relative value of
the Public Warrants (as defined below) and the Private Placement Warrants to the proceeds received from the Units sold upon the completion
of the Initial Public Offering. Accordingly, on October 25, 2021, offering costs totaling $16,408,042 (consisting of $3,450,000 of underwriting
fees, $6,037,500 of deferred underwriting fees, $6,335,214 excess fair value of Founder Shares and $585,328 of actual offering costs,
with $1,073,648 included in accumulated deficit as an allocation for the Public Warrants and the Private Placement Warrants, and $15,334,394
included in additional paid-in capital.
Income Taxes
The Company follows the asset and liability method
of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated
future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities
and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and
liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are
established, when necessary, to reduce deferred tax assets to the amount expected to be realized.
ASC 740 prescribes a recognition threshold and
a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax
return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities.
The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized
tax benefits and no amounts accrued for interest and penalties as of March 31, 2022 and December 31, 2021. The Company is currently
not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The
Company is subject to income tax examinations by major taxing authorities since inception.
The Company is considered an exempted Cayman Islands
company and is presently not subject to income taxes or income tax filing requirements in the Cayman Islands or the United States. As
such, the Company’s tax provision was zero for the period presented.
Derivative Financial Instruments
The Company evaluates its financial instruments
to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic
815, “Derivatives and Hedging”. For derivative financial instruments that are accounted for as liabilities, the derivative
instrument is initially recorded at its fair value on the grant date and is then re-valued at each reporting date, with changes in the
fair value reported in the statements of operations. The classification of derivative instruments, including whether such instruments
should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative liabilities are classified
in the balance sheet as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required
within 12 months of the balance sheet date.
THRIVE ACQUISITION CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2022
(Unaudited)
Warrant Liabilities
The Company accounts for the Public Warrants and
Private Placement Warrants exercisable for the Company’s ordinary shares that are not indexed to its own shares as liabilities at
fair value on the balance sheet. The Public Warrants and Private Placement Warrants are subject to re-measurement at each balance sheet
date and any change in fair value is recognized as a component of other income (expense), net on the statement of operations. The Company
will continue to adjust the liability for changes in fair value until the earlier of the exercise or expiration of the Public Warrants
and Private Placement Warrants. At that time, the portion of the warrant liability related to the Public Warrants and Private Placement
Warrants will be reclassified to additional paid-in capital.
Fair Value Measurements
Fair value is defined as the price that would
be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement
date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives
the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the
lowest priority to unobservable inputs (Level 3 measurements). These tiers include:
|
● |
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 some circumstances, the inputs used to measure
fair value might be categorized within different levels of the fair value hierarchy. In those instances, the fair value measurement is
categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement.
Class A Ordinary Shares Subject to Possible
Redemption
The Company accounts for its Class A ordinary
shares subject to possible redemption in accordance with the guidance in ASC 480. Class A ordinary shares subject to mandatory redemption
are classified as a liability instrument and are measured at fair value. Conditionally redeemable ordinary shares (including ordinary
shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of
uncertain events not solely within the Company’s control) are classified as temporary equity. At all other times, ordinary shares
are classified as shareholders’ equity. The Company’s Class A ordinary shares feature certain redemption rights that are considered
to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at March 31, 2022, Class
A ordinary shares subject to possible redemption are presented at redemption value as temporary equity, outside of the shareholders’
equity section of the Company’s balance sheet.
The Company recognizes changes in redemption value
immediately as they occur and adjusts the carrying value of redeemable ordinary shares to equal the redemption value at the end of each
reporting period. Such changes are reflected in additional paid-in capital, or in the absence of additional capital, in accumulated deficit.
On October 25, 2021, the Company recorded an accretion of $26,568,841, $6,595,054 of which was recorded in additional paid-in capital
and $19,973,787 was recorded in accumulated deficit.
Class A ordinary shares subject to possible redemption
is calculated as follows:
Class A ordinary shares subject to redemption, at redemption value as of December 31, 2021 | |
| 175,950,000 | |
Remeasurement of Class A ordinary shares to redemption value | |
| 68,457 | |
Class A ordinary shares subject to redemption, at redemption value as of March 31, 2022 | |
$ | 176,018,457 | |
THRIVE ACQUISITION CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2022
(Unaudited)
Net Income (Loss) Per Ordinary Share
Net loss (loss) per ordinary share is computed by
dividing net (income) loss by the weighted average number of ordinary shares outstanding during the period. Ordinary shares subject to
possible redemption at March 31, 2022, which are not currently redeemable and are not redeemable at fair value, have been excluded from
the calculation of basic net loss per ordinary share since such shares, if redeemed, only participate in their pro rata share of the Trust
Account earnings. The Company has not included the Public Warrants and the Private Placement Warrants in the calculation of diluted loss
per share, since the exercise of the warrants is contingent upon the occurrence of future events and the inclusion of such warrants would
be anti-dilutive. As a result, diluted net loss per ordinary share is the same as basic net loss per ordinary share for the periods presented.
The Company’s statement of operations includes
a presentation of net income (loss) per ordinary share subject to possible redemption and allocates the net income (loss) into the two
classes of shares in calculating net earnings (loss) per ordinary share, basic and diluted. For redeemable Class A ordinary shares, net
income (loss) per ordinary share is calculated by dividing the net loss by the weighted average number of Class A ordinary shares subject
to possible redemption outstanding since original issuance. For non-redeemable Class B ordinary shares, net earnings (loss) per share
is calculated by dividing the net loss by the weighted average number of non-redeemable Class B ordinary shares outstanding for the period.
Non-redeemable Class B ordinary shares include the Founder Shares as these shares do not have any redemption features and do not participate
in the income earned on the Trust Account. As of March 31, 2022, the Company did not have any dilutive securities or other contracts that
could, potentially, be exercised or converted into ordinary shares and then share in the earnings of the Company.
The following table reflects the calculation of basic and diluted net
loss per ordinary share (in dollars, except per share amounts):
| |
For the Three Months Ended March 31, 2022 | |
Class A ordinary shares subject to possible redemption | |
| |
Numerator: Income attributable to Class A ordinary shares subject to possible redemption | |
| |
Net income | |
$ | 3,457,886 | |
Net income attributable to Class A ordinary shares subject to possible redemption | |
$ | 3,457,886 | |
Denominator: Weighted average Class A ordinary shares subject to possible redemption | |
| | |
Basic and diluted weighted average shares outstanding, Class A ordinary shares subject to possible redemption | |
| 17,250,000 | |
Basic and diluted net income per share, Class A ordinary shares subject to possible redemption | |
$ | 0.20 | |
| |
| | |
Non-Redeemable Class B ordinary shares | |
| | |
Numerator: Net income | |
| | |
Net income | |
$ | 864,471 | |
Non-redeemable net income | |
$ | 864,471 | |
Denominator: Weighted average non-redeemable Class B ordinary shares | |
| | |
Basic and diluted weighted average shares outstanding, non-redeemable Class B ordinary shares | |
| 4,312,500 | |
Basic and diluted net income per share, non-redeemable Class B ordinary shares | |
$ | 0.20 | |
THRIVE ACQUISITION CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2022
(Unaudited)
Concentration of Credit Risk
Financial instruments that potentially subject
the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times, may exceed the Federal
Depository Insurance Coverage of $250,000. The Company had not experienced losses on this account and management believes the Company
is not exposed to significant risks on such account.
Fair Value of Financial Instruments
The fair value of the Company’s assets and
liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurement,” approximates the carrying
amounts represented in the Company’s balance sheet, primarily due to their short-term nature.
Recent Accounting Standards
In August 2020, the FASB issued ASU No. 2020-06, “Debt—Debt
with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic
815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity” (“ASU 2020-06”), which
simplifies accounting for convertible instruments by removing major separation models required under current GAAP. ASU 2020-06 removes
certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception and it also simplifies
the diluted earnings per share calculation in certain areas. The Company adopted ASU 2020-06 and was effective on January 1, 2022. The
Company has assessed the impact, if any, that ASU 2020-06 would have on its financial position, results of operations or cash flows and
determined that there is no impact as of March 31, 2022.
Management does not believe that any other recently
issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial
statements.
NOTE 3. PUBLIC OFFERING
Pursuant to the Initial Public Offering, the Company
sold 17,250,000 Units, which includes a full exercise by the underwriters of their over-allotment option in the amount of 2,250,000 Units,
at a price of $10.00 per Unit. Each Unit consists of one Class A ordinary share of the Company, par value $0.0001 per share (the “Class
A ordinary shares”) and one-half of one redeemable warrant of the Company (“Public Warrant”). Each whole Public Warrant
entitles the holder to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment (see Note 7).
NOTE 4. PRIVATE PLACEMENT
Simultaneously with the closing of the Initial
Public Offering, the Sponsor, GR Sleep LLC and Charles Urbain purchased an aggregate of 9,150,000 Private Placement Warrants at a price
of $1.00 per Private Placement Warrant (including 900,000 Private Placement Warrants purchased in connection with the exercise of the
underwriters’ over-allotment option) from the Company in a private placement that occurred simultaneously with the closing of the
Initial Public Offering. Each Private Placement Warrant is exercisable to purchase one Class A ordinary share at a price of $11.50 per
share, subject to adjustment (see Note 7). The proceeds from the sale of the Private Placement Warrants were added to the net proceeds
from the Initial Public Offering held in the Trust Account. If the Company does not complete a Business Combination within the Combination
Period, the proceeds from the sale of the Private Placement Warrants held in the Trust Account will be used to fund the redemption of
the Public Shares (subject to the requirements of applicable law) and the Private Placement Warrants will expire worthless.
NOTE 5. RELATED PARTY TRANSACTIONS
Founder Shares
On May 5, 2021, the Sponsor purchased 5,750,000
shares of the Company’s Class B ordinary shares (the “Founder Shares”) for an aggregate price of $25,000. Between May
2021 and September 2021, the Sponsor transferred to the Company’s executive officers, independent directors, and special advisor
an aggregate of 437,520 Founder Shares at a price of $0.004 per share. In September 2021, the Sponsor transferred 798,650 Founder Shares
to GR Sleep LLC (an entity controlled by Peter Graham) at a price of $0.004 per share. The Sponsor and Charles Urbain subsequently surrendered
to the Company an aggregate of 1,437,500 shares for no additional consideration resulting in a decrease in the total number of Founder
Shares outstanding to 4,312,500. As a result of the underwriters’ election to fully exercise their over-allotment option a total
of 562,500 Founder Shares are no longer subject to forfeiture.
THRIVE ACQUISITION CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2022
(Unaudited)
The Sponsor, other directors and executive officers
have agreed, subject to limited exceptions, not to transfer, assign or sell any of their Founder Shares (including any Class A ordinary
shares issuable upon conversion thereof) until the earliest of (A) one year after the completion of an Initial Business Combination and
(B) subsequent to an Initial Business Combination, (x) if the closing price of the Class A ordinary shares equals or exceeds $12.00 per
share (as adjusted for share splits, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within
any 30-trading day period commencing at least 150 days after our initial business combination, or (y) the date on which we complete a
liquidation, merger, share exchange, reorganization or other similar transaction that results in all of our public shareholders having
the right to exchange their ordinary shares for cash, securities or other property.
Administrative Services Agreement
The Company entered into an agreement, commencing
on the date that the Company’s securities are first listed on a U.S. national securities exchange through the earlier of the Company’s
consummation of an Initial Business Combination and its liquidation, to pay the Sponsor or an affiliate thereof a total of $1,000 per
month for office space, secretarial, and administrative support. Upon completion of the Initial Business Combination or the Company’s
liquidation, the Company will cease paying these monthly fees. For the three months ended March 31, 2022, the Company incurred $3,000
in fees for these services, of which $2,000 has been paid and $1,000 is accrued for in accounts payable.
Promissory Note — Related Party
On May 5, 2021, the Sponsor issued an unsecured
promissory note to the Company (the “Promissory Note”), pursuant to which the Company may borrow up to an aggregate principal
amount of $300,000. The Promissory Note is non-interest bearing and payable on the earlier of (i) January 5, 2022, or (ii) the
consummation of the Initial Public Offering. The outstanding balance under the Promissory Note was subsequently repaid on October 26,
2021. As of March 31, 2022 and December 31, 2021, there were no borrowings outstanding under the Promissory Note.
Related Party Loans
In order to finance transaction costs in connection
with its Initial Business Combination, the Sponsor or an affiliate of the Sponsor, or the Company’s officers and directors may,
but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes its
Initial Business Combination, the Company would repay the Working Capital Loans. In the event that the Initial Business Combination does
not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds
held in the Trust Account would be used to repay the Working Capital Loans. If the Sponsor makes any Working Capital Loans, up to $1,500,000
of such loans may be converted into warrants of the post business combination entity at the price of $1.00 per warrant at the option of
the lender. Such warrants would be identical to the Private Placement Warrants, including as to exercise price, exercisability, and exercise
period. As of March 31, 2022 and December 31, 2021, the Company has no borrowings under the Working Capital Loans.
NOTE 6. COMMITMENTS AND CONTINGENCIES
Registration Rights
Pursuant to a registration rights agreement entered
into on October 20, 2021, the holders of the Founder Shares, Private Placement Warrants and warrants that may be issued upon conversion
of Working Capital Loans (and any Class A ordinary shares issuable upon the exercise of the Private Placement Warrants and warrants
that may be issued upon conversion of Working Capital Loans and upon conversion of the Founder Shares) will have registration rights to
require the Company to register a sale of any of its securities held by them. The holders of these securities are entitled to make up
to three demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain “piggy-back”
registration rights with respect to registration statements filed subsequent to the completion of a Business Combination. The registration
rights agreement does not contain liquidated damages or other cash settlement provisions resulting from delays in registering our securities.
The Company will bear the expenses incurred in connection with the filing of any such registration statements.
THRIVE ACQUISITION CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2022
(Unaudited)
Underwriting Agreement
Following the closing of the Initial Public Offering,
underwriters are entitled to a deferred fee of $0.35 per Unit, or $6,037,500 in the aggregate. The deferred fee will become payable
to the underwriters from the amounts held in the Trust Account solely in the event that the Company completes a Business Combination,
subject to the terms of the underwriting agreement.
NOTE 7. SHAREHOLDERS’ DEFICIT
Preference Shares — The Company
is authorized to issue up to 5,000,000 preference shares with a par value of $0.0001. At March 31, 2022 and December 31, 2021, there were
no preference shares issued or outstanding.
Class A Ordinary Shares—The
Company is authorized to issue 500,000,000 Class A ordinary shares with a par value of $0.0001 per share. Holders of Class A ordinary
shares are entitled to one vote for each share. As of March 31, 2022, and December 31, 2021, there were no Class A ordinary shares
issued or outstanding, excluding 17,250,000 shares subject to possible redemption.
Class B Ordinary Shares —
The Company is authorized to issue 50,000,000 Class B ordinary shares with a par value of $0.0001 per share. Holders of Class B ordinary
shares are entitled to one vote for each share. As of March 31, 2022 and December 31, 2021, there were 4,312,500 Class B ordinary shares
issued and outstanding.
Holders of Class A ordinary shares and Class B
ordinary shares will vote together as a single class on all matters submitted to a vote of shareholders except as required by law.
The Class B ordinary shares will automatically
convert into Class A ordinary shares at the time of an Initial Business Combination on a one-for-one basis, subject to adjustment. In
the case that additional Class A ordinary shares, or equity-linked securities, are issued or deemed issued in excess of the amounts offered
in the Initial Public Offering and related to the closing of an Initial Business Combination, the ratio at which Class B ordinary shares
shall convert into Class A ordinary shares will be adjusted (unless the holders of a majority of the outstanding Class B ordinary shares
agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of Class A ordinary shares issuable
upon conversion of all Class B ordinary shares will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number
of all Class A ordinary shares outstanding upon the completion of the Initial Public Offering plus all Class A ordinary shares and equity-linked
securities issued or deemed issued in connection with an Initial Business Combination (excluding any shares or equity-linked securities
issued, or to be issued, to any seller in an Initial Business Combination).
NOTE 8. WARRANTS
Warrants — Public Warrants
may only be exercised for a whole number of shares. No fractional warrants will be issued upon separation of the Units and only whole
warrants will trade. The Public Warrants will become exercisable on the later of (a) 12 months from the closing of the Initial Public
Offering and (b) 30 days after the completion of an Initial Business Combination.
The Company will not be obligated to deliver any Class
A ordinary shares pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise unless a registration
statement under the Securities Act with respect to the Class A ordinary shares underlying the warrants is then effective and a prospectus
relating thereto is current, subject to the Company satisfying its obligations with respect to registration, or a valid exemption from
registration is available. No warrant will be exercisable, and the Company will not be obligated to issue any Class A ordinary shares
upon exercise of a warrant unless the Class A ordinary shares issuable upon such warrant exercise has been registered, qualified or deemed
to be exempt under the securities laws of the state of residence of the registered holder of the warrants.
THRIVE ACQUISITION CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2022
(Unaudited)
The Company has agreed that as soon as practicable,
but in no event later than 15 business days after the closing of an Initial Business Combination, it will use its commercially reasonable
efforts to file with the SEC a registration statement for the registration, under the Securities Act, of the Class A ordinary shares issuable
upon exercise of the warrants, and the Company will use its commercially reasonable efforts to cause the same to become effective within
60 business days after the closing of an Initial Business Combination, and to maintain the effectiveness of such registration statement
and a current prospectus relating to those Class A ordinary shares until the warrants expire or are redeemed, as specified in the warrant
agreement; provided that if the Class A ordinary shares are at the time of any exercise of a warrant not listed on a national securities
exchange such that they satisfy the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company
may, at its option, require holders of Public Warrants who exercise their warrants to do so on a “cashless basis” in accordance
with Section 3(a)(9) of the Securities Act and, in the event the Company so elects, the Company will not be required to file or maintain
in effect a registration statement, but it will use its commercially reasonably efforts to register or qualify the shares under applicable
blue sky laws to the extent an exemption is not available. If a registration statement covering the Class A ordinary shares issuable upon
exercise of the warrants is not effective by the 60th business day after the closing of an Initial Business Combination, warrant
holders may, until such time as there is an effective registration statement and during any period when the Company will have failed to
maintain an effective registration statement, exercise warrants on a “cashless basis” in accordance with Section 3(a)(9) of
the Securities Act or another exemption, but the Company will use its commercially reasonably efforts to register or qualify the shares
under applicable blue sky laws to the extent an exemption is not available.
Redemption of Warrants When the Price per
Class A ordinary share Equals or Exceeds $18.00 — Once the Public Warrants become exercisable, the Company may redeem
the Public Warrants:
| ● | in whole and not in part; |
| | |
| ● | at a price of $0.01 per warrant; |
| | |
| ● | upon not less than 30 days’ prior written notice of redemption to each warrant holder; and |
| | |
| ● | if, and only if, the closing price of the Class A ordinary shares equals or exceeds $18.00 per share (subject to certain adjustments) for any 20 trading days within a 30-trading day period ending three trading days before the notice of redemption is sent to the warrant holders. |
If and when the Public Warrants become redeemable
by the Company, it may exercise its redemption right even if the Company is unable to register or qualify the underlying securities for
sale under all applicable state securities laws.
Redemption of Warrants When the Price per
Class A ordinary share Equals or Exceeds $10.00 — Once the Public Warrants become exercisable, the Company may redeem
the Public Warrants:
| ● | in whole and not in part; |
| | |
| ● | at $0.10 per warrant; |
| | |
| ● | upon a minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares based on the redemption date and the fair market value of the Class A ordinary shares; |
| | |
| ● | if, and only if, the Reference Value equals or exceeds $10.00 per share; and |
| | |
| ● | if the Reference Value is less than $18.00 per share, the private placement warrants must also be concurrently called for redemption on the same terms as the outstanding public warrants, as described above. |
In addition, if (x) the Company issues additional
Class A ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of an Initial Business
Combination at an issue price or effective issue price of less than $9.20 per Class A ordinary share (with such issue price or effective
issue price to be determined in good faith by the Company’s board of directors and, in the case of any such issuance to the Sponsor
or its affiliates, without taking into account any Founder Shares held by the Sponsor or such affiliates, as applicable, prior to such
issuance) (the “Newly Issued Price”), (y) the aggregate gross proceeds from such issuances represent more than 60% of
the total equity proceeds, and interest thereon, available for the funding of an Initial Business Combination on the date of the consummation
of an Initial Business Combination (net of redemptions), and (z) the volume weighted average trading price of the Class A ordinary
shares during the 20 trading day period starting on the trading day prior to the day on which the Company consummates an Initial Business
Combination (such price, the “Market Value”) is below $9.20 per share, then the exercise price of the warrants will be adjusted
(to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, the $18.00 per share redemption
trigger price and the “Redemption of Warrants when the price per Class A ordinary shares equals or exceeds $10.00” described
above will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price, and the
$10.00 per share redemption trigger price described above.
THRIVE ACQUISITION CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2022
(Unaudited)
The Private Placement Warrants are identical to
the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Placement Warrants and the Class A
ordinary shares issuable upon the exercise of the Private Placement Warrants are not be transferable, assignable or saleable until 30 days
after the completion of an Initial Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants
are exercisable for cash or on a cashless basis, at the holder’s option, and are non-redeemable so long as they are held by the
initial purchasers or their permitted transferees (except for a number of Class A ordinary shares as described above under Redemption
of warrants for Class A ordinary shares). If the Private Placement Warrants are held by someone other than the initial purchasers
or their permitted transferees, the Private Placement Warrants will be redeemable by the Company in all redemption scenarios and exercisable
by such holders on the same basis as the Public Warrants.
NOTE 9. FAIR VALUE MEASUREMENTS
At March 31, 2022, the Company’s warrant
liability was valued at $4,242,125. Under the guidance in ASC 815-40, the Public Warrants and the Private Placement Warrants do not meet
the criteria for equity treatment. As such, the Public Warrants and the Private Placement Warrants must be recorded on the balance sheet
at fair value. This valuation is subject to re-measurement at each balance sheet date. With each re-measurement, the valuations will be
adjusted to fair value, with the change in fair value recognized in the Company’s statement of operations.
The following table presents fair value information
as of March 31, 2022, of the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis
and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. The Company’s
warrant liability is based on a valuation model utilizing management judgment and pricing inputs from observable and unobservable markets
with less volume and transaction frequency than active markets. Significant deviations from these estimates and inputs could result in
a material change in fair value. The fair value of the private warrant liability is classified within Level 3 of the fair value hierarchy.
There were no transfers within Level 3 fair value measurements during the three months ended March 31, 2022.
The fair value of the Company’s financial
assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale
of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the
measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of
observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions
about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities
based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:
Level 1: Quoted prices in active markets for identical
assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with
sufficient frequency and volume to provide pricing information on an ongoing basis.
Level 2: Observable inputs other than Level 1
inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical
assets or liabilities in markets that are not active.
Level 3: Unobservable inputs based on our assessment
of the assumptions that market participants would use in pricing the asset or liability.
THRIVE ACQUISITION CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2022
(Unaudited)
The following table sets forth by level within the
fair value hierarchy the Company’s assets and liabilities that were accounted for at fair value on a recurring basis at March 31,
2022 and December 31, 2021:
| |
March 31, 2022 | |
| |
(Level 1) | | |
(Level 2) | | |
(Level 3) | |
Assets | |
| | |
| | |
| |
Cash and marketable securities held in trust account | |
$ | 176,018,457 | | |
$ | - | | |
$ | - | |
Liabilities | |
| | | |
| | | |
| | |
Public Warrants | |
$ | 2,044,125 | | |
$ | - | | |
$ | - | |
Private Placement Warrants | |
$ | - | | |
$ | - | | |
$ | 2,198,000 | |
| |
December 31, 2021 | |
| |
(Level 1) | | |
(Level 2) | | |
(Level 3) | |
Assets | |
| | |
| | |
| |
Cash and marketable securities held in trust account | |
$ | 175,962,514 | | |
$ | - | | |
$ | - | |
Liabilities | |
| | | |
| | | |
| | |
Public Warrants | |
$ | 4,296,975 | | |
$ | - | | |
$ | - | |
Private Placement Warrants | |
$ | - | | |
$ | - | | |
$ | 4,618,000 | |
The following table presents the changes in the fair value of derivative
warrant liabilities for the three months ended March 31, 2022:
| |
Public Warrants | | |
Private Placement Warrants | | |
Total Derivative Warrant Liability | |
Derivative warrant liabilities as of December 31, 2021 | |
$ | 4,296,975 | | |
$ | 4,618,000 | | |
$ | 8,914,975 | |
Change in fair value | |
| (2,252,850 | ) | |
| (2,420,000 | ) | |
| (4,672,850 | ) |
Derivative warrant liabilities as of March 31, 2022 | |
$ | 2,044,125 | | |
$ | 2,198,000 | | |
$ | 4,242,125 | |
Measurement
The Company established the initial fair value
for the warrants on October 25, 2021, the date of the consummation of the Company’s Initial Public Offering. The Company used a
lattice model and Monte Carlo simulation model to value the warrants. The Company allocated the proceeds received from (i) the sale of
Units (which is inclusive of one Class A Ordinary Share and one-half of one Public Warrant), (ii) the sale of Private Placement Warrants,
and (iii) the issuance of Class B ordinary shares, first to the warrants based on their fair values as determined at initial measurement,
with the remaining proceeds allocated to Class A ordinary shares subject to possible redemption (temporary equity), Class A ordinary shares
(permanent equity) and Class B ordinary shares (permanent equity) based on their relative fair values at the initial measurement date.
The key inputs into the lattice model and Monte
Carlo simulation model formula were as follows at March 31, 2022 and December 31, 2021:
| |
Private Placement Warrants | |
| |
March 31, | | |
December 31, | |
Input | |
2022 | | |
2021 | |
Ordinary share price | |
$ | 10.00 | | |
$ | 9.8801 | |
Exercise price | |
$ | 11.50 | | |
$ | 11.50 | |
Risk-free rate of interest | |
| 2.40 | % | |
| 1.33 | % |
Volatility | |
| 3.69 | % | |
| 9.28 | % |
Term | |
| 5.56 | | |
| 5.81 | |
Value of one private warrant | |
$ | 0.24 | | |
$ | 0.51 | |
Dividend yield | |
| 0.00 | % | |
| 0.00 | % |
NOTE 10. SUBSEQUENT EVENTS
The Company evaluated subsequent events and transactions
that occurred after the balance sheet date up to the date that the financial statements were issued. Other than as described in these
financial statements, the Company did not identify any subsequent events that would have required adjustment or disclosure in the financial
statements.