Washington, D.C.
☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Mark One)
☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ TRANSITION REPORT PURSUANT TO SECTION 13 2023
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
________
VPC Impact Acquisition Holdings
(Exact Name of Registrant as Specified in Its Charter)
Delaware | 98-1550750 | |||||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
10000 Avalon Boulevard, Suite
Alpharetta, Georgia | ||||||
(Address of principal executive offices) | (Zip Code) |
+1-312-701-1777
(Issuer’s
code: (678) 534-5849
Title of each class | Trading | Name of each exchange on which registered | ||||||||||||
The | ||||||||||||||
Warrants to purchase Class A Common Stock | ||||||||||||||
The |
☐
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||||||||||||||||
Non-accelerated filer | ☒ | Smaller reporting company | ☒ | |||||||||||||||||
VPC IMPACT ACQUISITION HOLDINGS
QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 2020
TABLE OF CONTENTS
Page | |||||||||||
Unregistered Sales of Equity Securities | |||||||||||
VPC IMPACT ACQUISITION HOLDINGS
ASSETS Current assets Cash Prepaid expense Total Current Assets Cash and marketable securities held in Trust Account TOTAL ASSETS LIABILITIES AND SHAREHOLDERS’ EQUITY Current liability—accrued offering costs Deferred underwriting fee payable Total Liabilities Commitments and Contingencies (Note 6) Class A ordinary shares subject to possible redemption, 18,950,647 shares at $10.00 per share Shareholders’ Equity Preference shares, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding Class A ordinary shares, $0.0001 par value; 200,000,000 shares authorized; 1,049,353 shares issued and outstanding (excluding 18,950,647 shares subject to possible redemption) Class B ordinary shares, $0.0001 par value; 20,000,000 shares authorized; 5,184,300 shares issued and outstanding (1) Additional paid-in capital Accumulated deficit Total Shareholders’ Equity TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY CONDENSED BALANCE SHEETSeptember 30, 2020(Unaudited) $ 1,230,178 278,363 1,508,541 200,000,164 $ 201,508,705 $ 2,230 7,000,000 7,002,230 189,506,470 — 105 518 5,016,761 (17,379 ) 5,000,005 $ 201,508,705 (1)In connection with the underwriters’ partial exercise of the over-allotment option and the forfeiture of the remaining over-allotment option on October 1, 2020, 565,700 Founder Shares were forfeited and 184,300 Founder Shares are no longer subject to forfeiture resulting in an aggregate of 5,184,300 Founder Shares outstanding at September 30, 2020. All share amounts have been retroactively restated to reflect the forfeiture (see Note 5).
As of September 30, 2023 (Unaudited) | As of December 31, 2022 | ||||||||||
Assets | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | 68,219 | $ | 98,332 | |||||||
Restricted cash | 28,262 | 16,500 | |||||||||
Customer funds | 28,223 | 591 | |||||||||
Available-for-sale securities | 22,678 | 141,062 | |||||||||
Accounts receivable, net | 21,699 | 25,306 | |||||||||
Prepaid insurance | 12,050 | 22,822 | |||||||||
Safeguarding asset for crypto | 505,697 | 15,792 | |||||||||
Other current assets | 7,329 | 6,060 | |||||||||
Total current assets | 694,157 | 326,465 | |||||||||
Property, equipment and software, net | 20,508 | 19,744 | |||||||||
Goodwill | 66,500 | 15,852 | |||||||||
Intangible assets, net | 41,738 | 55,833 | |||||||||
Deposits with clearinghouse | 159 | 15,150 | |||||||||
Other assets | 23,672 | 22,458 | |||||||||
Total assets | $ | 846,734 | $ | 455,502 | |||||||
Liabilities and stockholders’ equity | |||||||||||
Current liabilities: | |||||||||||
Accounts payable and accrued liabilities | $ | 49,192 | $ | 66,787 | |||||||
Customer funds payable | 28,223 | 591 | |||||||||
Deferred revenue, current | 4,370 | 3,972 | |||||||||
Due to related party | 1,770 | 1,168 | |||||||||
Safeguarding obligation for crypto | 505,697 | 15,792 | |||||||||
Other current liabilities | 4,303 | 3,819 | |||||||||
Total current liabilities | 593,555 | 92,129 | |||||||||
Deferred revenue, noncurrent | 2,850 | 3,112 | |||||||||
Warrant liability | 1,642 | 785 | |||||||||
Other noncurrent liabilities | 37,612 | 23,402 | |||||||||
Total liabilities | 635,659 | 119,428 | |||||||||
Commitments and contingencies (Note 14) | |||||||||||
Class A common stock ($0.0001 par value, 750,000,000 shares authorized, 91,414,923 shares issued and outstanding as of September 30, 2023 and 80,926,843 shares issued and outstanding as of December 31, 2022) | 9 | 8 | |||||||||
Class V common stock ($0.0001 par value, 250,000,000 shares authorized, 183,249,426 shares issued and outstanding as of September 30, 2023 and 183,482,777 shares issued and outstanding as of December 31, 2022) | 19 | 19 | |||||||||
Additional paid-in capital | 794,199 | 772,973 | |||||||||
Accumulated other comprehensive loss | (293) | (290) | |||||||||
Accumulated deficit | (724,602) | (676,447) | |||||||||
Total stockholders’ equity | 69,332 | 96,263 | |||||||||
Noncontrolling interest | 141,743 | 239,811 | |||||||||
Total equity | 211,075 | 336,074 | |||||||||
Total liabilities and stockholders’ equity | $ | 846,734 | $ | 455,502 |
1
VPC IMPACT ACQUISITION HOLDINGS
CONDENSED STATEMENT OF OPERATIONSFOR THE PERIOD FROM JULY 31, 2020 (INCEPTION) THROUGH SEPTEMBER 30, 2020
Operating costs | $ | 17,543 | ||
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Loss from operations | (17,543 | ) | ||
Other income: | ||||
Interest earned on investments held in Trust Account | 164 | |||
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Net loss | $ | (17,379 | ) | |
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Weighted average shares outstanding of Class A redeemable ordinary shares | 20,000,000 | |||
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Basic and diluted net income per share, Class A redeemable ordinary shares | $ | 0.00 | ||
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Weighted average shares outstanding of Class B non-redeemable ordinary shares (1) | 5,184,300 | |||
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Basic and diluted net loss per share, Class B non-redeemable ordinary shares | $ | (0.00 | ) | |
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Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | ||||||||||||||||||||
Revenues: | |||||||||||||||||||||||
Crypto services | $ | 191,750 | $ | 471 | $ | 527,526 | $ | 1,464 | |||||||||||||||
Loyalty services, net | 13,024 | 12,742 | 38,096 | 38,852 | |||||||||||||||||||
Total revenues | 204,774 | 13,213 | 565,622 | 40,316 | |||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Crypto costs | 189,428 | 353 | 521,601 | 1,352 | |||||||||||||||||||
Execution, clearing and brokerage fees | 697 | — | 2,902 | — | |||||||||||||||||||
Compensation and benefits | 24,608 | 37,800 | 85,818 | 107,135 | |||||||||||||||||||
Professional services | 1,962 | 2,707 | 7,204 | 9,291 | |||||||||||||||||||
Technology and communication | 5,536 | 4,137 | 15,647 | 12,659 | |||||||||||||||||||
Selling, general and administrative | 7,447 | 7,792 | 21,722 | 26,995 | |||||||||||||||||||
Acquisition-related expenses | (739) | 454 | 17,053 | 1,148 | |||||||||||||||||||
Depreciation and amortization | 3,959 | 6,391 | 10,843 | 18,340 | |||||||||||||||||||
Related party expenses | 1,033 | 267 | 3,145 | 901 | |||||||||||||||||||
Goodwill and intangible assets impairments | 23,325 | 1,547,711 | 23,325 | 1,547,711 | |||||||||||||||||||
Impairment of long-lived assets | 56 | 15 | 56 | 15 | |||||||||||||||||||
Restructuring expenses | — | — | 4,471 | — | |||||||||||||||||||
Other operating expenses | 322 | 487 | 1,231 | 1,706 | |||||||||||||||||||
Total operating expenses | 257,634 | 1,608,114 | 715,018 | 1,727,253 | |||||||||||||||||||
Operating loss | (52,860) | (1,594,901) | (149,396) | (1,686,937) | |||||||||||||||||||
Interest income, net | 1,177 | 623 | 3,502 | 838 | |||||||||||||||||||
(Loss) gain from change in fair value of warrant liability | (214) | 428 | (857) | 13,139 | |||||||||||||||||||
Other income, net | 379 | 696 | 33 | 607 | |||||||||||||||||||
Loss before income taxes | (51,518) | (1,593,154) | (146,718) | (1,672,353) | |||||||||||||||||||
Income tax (expense) benefit | (231) | 606 | (401) | 8,844 | |||||||||||||||||||
Net loss | (51,749) | (1,592,548) | (147,119) | (1,663,509) | |||||||||||||||||||
Less: Net loss attributable to noncontrolling interest | (34,418) | (1,124,416) | (98,964) | (1,184,352) | |||||||||||||||||||
Net loss attributable to Bakkt Holdings, Inc. | $ | (17,331) | $ | (468,132) | $ | (48,155) | $ | (479,157) | |||||||||||||||
Net loss per share attributable to Class A common stockholders: | |||||||||||||||||||||||
Basic | $ | (0.19) | $ | (6.11) | $ | (0.55) | $ | (7.00) | |||||||||||||||
Diluted | $ | (0.19) | $ | (6.11) | $ | (0.55) | $ | (7.00) |
2
VPC IMPACT ACQUISITION HOLDINGS
CONDENSED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITYFOR THE PERIOD FROM JULY 31, 2020 (INCEPTION) THROUGH SEPTEMBER 30, 2020
Class A Ordinary Shares | Class B Ordinary Shares | Additional Paid in Capital | Accumulated Deficit | Total Shareholders’ Equity | ||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||
Balance – July 31, 2020 (Inception) | — | $ | — | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||
Issuance of Class B ordinary shares to Sponsor | — | — | 5,750,000 | 575 | 24,425 | — | 25,000 | |||||||||||||||||||||
Sale of 20,000,000 Units, net of underwriting discounts and offering costs | 20,000,000 | 2,000 | — | — | 188,496,854 | — | 188,498,854 | |||||||||||||||||||||
Sale of 6,000,000 Private Placement Warrants | — | — | — | — | 6,000,000 | — | 6,000,000 | |||||||||||||||||||||
Forfeiture of Founder Shares | — | — | (565,700 | ) | (57 | ) | 57 | — | — | |||||||||||||||||||
Ordinary shares subject to possible redemption | (18,950,647 | ) | (1,895 | ) | — | — | (189,504,575 | ) | — | (189,506,470 | ) | |||||||||||||||||
Net loss | — | — | — | — | — | (17,379 | ) | (17,379 | ) | |||||||||||||||||||
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Balance – September 30, 2020 (1) | 1,049,353 | $ | 105 | 5,184,300 | $ | 518 | $ | 5,016,761 | $ | (17,379 | ) | $ | 5,000,005 | |||||||||||||||
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Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | ||||||||||||||||||||
Net loss | $ | (51,749) | $ | (1,592,548) | $ | (147,119) | $ | (1,663,509) | |||||||||||||||
Currency translation adjustment, net of tax | (397) | (777) | (36) | (971) | |||||||||||||||||||
Unrealized gains (losses) on available-for-sale securities, net of tax | 16 | (165) | 20 | (178) | |||||||||||||||||||
Comprehensive loss | $ | (52,130) | $ | (1,593,490) | $ | (147,135) | $ | (1,664,658) | |||||||||||||||
Comprehensive loss attributable to noncontrolling interest | (34,669) | (1,125,081) | (98,977) | (1,185,157) | |||||||||||||||||||
Comprehensive loss attributable to Bakkt Holdings, Inc. | $ | (17,461) | $ | (468,409) | $ | (48,158) | $ | (479,501) |
3
VPC IMPACT ACQUISITION HOLDINGS
CONDENSED STATEMENT OF CASH FLOWSFOR THE PERIOD FROM JULY 31, 2020 (INCEPTION) THROUGH SEPTEMBER 30, 2020
Cash Flows from Operating Activities: | ||||
Net loss | $ | (17,379 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Interest earned on marketable securities held in Trust Account | (164 | ) | ||
Formation costs paid by Sponsor | 6,606 | |||
Changes in operating assets and liabilities: | ||||
Prepaid expenses | (278,363 | ) | ||
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Net cash used in operating activities | (289,300 | ) | ||
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Cash Flows from Investing Activities: | ||||
Investment of cash in Trust Account | (200,000,000 | ) | ||
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Net cash used in investing activities | (200,000,000 | ) | ||
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Cash Flows from Financing Activities: | ||||
Proceeds from sale of Units, net of underwriting discounts paid | 196,000,000 | |||
Proceeds from sale of Private Placement Warrants | 6,000,000 | |||
Repayment of promissory note – related party | (82,729 | ) | ||
Payments of offering costs | (397,793 | ) | ||
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Net cash provided by financing activities | 201,519,478 | |||
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Net Change in Cash | 1,230,178 | |||
Cash – Beginning | — | |||
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Cash – Ending | $ | 1,230,178 | ||
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Non-Cash Investing and Financing Activities: | ||||
Offering costs included in accrued offering costs | $ | 2,230 | ||
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Initial classification of ordinary shares subject to possible redemption | $ | 189,517,240 | ||
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Change in value of ordinary shares subject to possible redemption | $ | (10,770 | ) | |
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Deferred underwriting fee payable | $ | 7,000,000 | ||
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Offering costs paid directly by Sponsor from proceeds of issuance of Class B ordinary shares | $ | 18,394 | ||
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Payment of offering costs through promissory note – related party | $ | 82,729 | ||
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Class A Common Stock | Class V Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total Stockholders’ Equity | Noncontrolling Interest | Total Equity | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | $ | Shares | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2022 | 80,926,843 | $ | 8 | 183,482,777 | $ | 19 | $ | 772,973 | $ | (676,447) | $ | (290) | $ | 96,263 | $ | 239,811 | $ | 336,074 | |||||||||||||||||||||||||||||||||||||||||
Share-based compensation | — | — | — | — | 6,713 | — | — | 6,713 | — | 6,713 | |||||||||||||||||||||||||||||||||||||||||||||||||
Unit-based compensation | — | — | — | — | — | — | — | — | 542 | 542 | |||||||||||||||||||||||||||||||||||||||||||||||||
Shares issued upon vesting of share-based awards, net of tax withholding | 1,495,040 | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Exchange of Class V shares for Class A shares | 202,890 | — | (202,890) | — | 345 | — | — | 345 | (345) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Currency translation adjustment, net of tax | — | — | — | — | — | — | 7 | 7 | 15 | 22 | |||||||||||||||||||||||||||||||||||||||||||||||||
Unrealized losses on available-for-sale securities, net of tax | — | — | — | — | — | — | (72) | (72) | (157) | (229) | |||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | (13,976) | — | (13,976) | (30,883) | (44,859) | |||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of March 31, 2023 | 82,624,773 | $ | 8 | 183,279,887 | $ | 19 | $ | 780,031 | $ | (690,423) | $ | (355) | $ | 89,280 | $ | 208,983 | $ | 298,263 | |||||||||||||||||||||||||||||||||||||||||
Share-based compensation | — | — | — | — | 4,614 | — | — | 4,614 | — | 4,614 | |||||||||||||||||||||||||||||||||||||||||||||||||
Unit-based compensation | — | — | — | — | — | — | — | — | 377 | 377 | |||||||||||||||||||||||||||||||||||||||||||||||||
Shares issued upon vesting of share-based awards, net of tax withholding | 2,520,711 | — | — | — | (2,502) | — | — | (2,502) | — | (2,502) | |||||||||||||||||||||||||||||||||||||||||||||||||
Shares issued in connection with Apex acquisition | 6,140,611 | 1 | — | — | 9,062 | — | — | 9,063 | — | 9,063 | |||||||||||||||||||||||||||||||||||||||||||||||||
Exchange of Class V shares for Class A shares | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Currency translation adjustment, net of tax | — | — | — | — | — | — | 112 | 112 | 227 | 339 | |||||||||||||||||||||||||||||||||||||||||||||||||
Unrealized losses on available-for-sale securities, net of tax | — | — | — | — | — | — | 77 | 77 | 156 | 233 | |||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | (16,848) | — | (16,848) | (33,663) | (50,511) | |||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2023 | 91,286,095 | $ | 9 | 183,279,887 | $ | 19 | $ | 791,205 | $ | (707,271) | $ | (166) | $ | 83,796 | $ | 176,080 | $ | 259,876 | |||||||||||||||||||||||||||||||||||||||||
Share-based compensation | — | — | — | — | 2,957 | — | — | 2,957 | — | 2,957 | |||||||||||||||||||||||||||||||||||||||||||||||||
Unit-based compensation | — | — | — | — | — | — | — | — | 385 | 385 | |||||||||||||||||||||||||||||||||||||||||||||||||
Forfeiture and cancellation of common units | — | — | (4,845) | — | — | — | — | — | (13) | (13) | |||||||||||||||||||||||||||||||||||||||||||||||||
Shares issued upon vesting of share-based awards, net of tax withholding | 103,212 | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Exchange of Class V shares for Class A shares | 25,616 | — | (25,616) | — | 37 | — | — | 37 | (37) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Currency translation adjustment, net of tax | — | — | — | — | — | — | (133) | (133) | (264) | (397) | |||||||||||||||||||||||||||||||||||||||||||||||||
Unrealized losses on available-for-sale securities, net of tax | — | — | — | — | — | — | 6 | 6 | 10 | 16 | |||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | (17,331) | — | (17,331) | (34,418) | (51,749) | |||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of September 30, 2023 | 91,414,923 | $ | 9 | 183,249,426 | $ | 19 | $ | 794,199 | $ | (724,602) | $ | (293) | $ | 69,332 | $ | 141,743 | $ | 211,075 |
Class A Common Stock | Class V Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total Stockholders’ Equity | Noncontrolling Interest | Total Equity | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | $ | Shares | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2021 | 57,164,388 | $ | 6 | 206,271,792 | $ | 21 | $ | 566,766 | $ | (98,342) | $ | (55) | $ | 468,396 | $ | 1,825,775 | $ | 2,294,171 | |||||||||||||||||||||||||||||||||||||||||
Share-based compensation | — | — | — | — | 13,190 | — | — | 13,190 | — | 13,190 | |||||||||||||||||||||||||||||||||||||||||||||||||
Unit-based compensation | — | — | — | — | — | — | — | — | 1,118 | 1,118 | |||||||||||||||||||||||||||||||||||||||||||||||||
Forfeiture and cancellation of common units | — | — | (268,522) | — | — | — | — | — | (60) | (60) | |||||||||||||||||||||||||||||||||||||||||||||||||
Exercise of warrants | 100 | — | — | — | 1 | — | — | 1 | — | 1 | |||||||||||||||||||||||||||||||||||||||||||||||||
Currency translation adjustment, net of tax | — | — | — | — | — | — | 41 | 41 | 147 | 188 | |||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | (7,128) | — | (7,128) | (36,193) | (43,321) | |||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of March 31, 2022 | 57,164,488 | $ | 6 | 206,003,270 | $ | 21 | $ | 579,957 | $ | (105,470) | $ | (14) | $ | 474,500 | $ | 1,790,787 | $ | 2,265,287 | |||||||||||||||||||||||||||||||||||||||||
Share-based compensation | — | — | — | — | 8,016 | — | — | 8,016 | — | 8,016 | |||||||||||||||||||||||||||||||||||||||||||||||||
Unit-based compensation | — | — | — | — | — | — | — | — | 1,063 | 1,063 | |||||||||||||||||||||||||||||||||||||||||||||||||
Forfeiture and cancellation of common units | — | — | (9,693) | — | — | — | — | — | (15) | (15) | |||||||||||||||||||||||||||||||||||||||||||||||||
Exercise of warrants | 100 | — | — | — | 1 | — | — | 1 | — | 1 | |||||||||||||||||||||||||||||||||||||||||||||||||
Shares issued upon vesting of share-based awards, net of tax withholding | 624,497 | — | — | — | (2,586) | — | — | (2,586) | — | (2,586) | |||||||||||||||||||||||||||||||||||||||||||||||||
Exchange of Class V shares for Class A shares | 17,554,639 | 2 | (17,554,639) | (2) | 152,235 | — | — | 152,235 | (152,235) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Increase in deferred tax liability from step-up tax basis related to exchanges of Opco Common Units | — | — | — | — | (19,063) | — | — | (19,063) | — | (19,063) | |||||||||||||||||||||||||||||||||||||||||||||||||
Currency translation adjustment, net of tax | — | — | — | — | — | — | (105) | (105) | (277) | (382) | |||||||||||||||||||||||||||||||||||||||||||||||||
Unrealized losses on available-for-sale securities | — | — | — | — | — | — | (4) | (4) | (9) | (13) | |||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | (3,897) | — | (3,897) | (23,744) | (27,641) | |||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2022 | 75,343,724 | $ | 8 | 188,438,938 | $ | 19 | $ | 718,560 | $ | (109,367) | $ | (123) | $ | 609,097 | $ | 1,615,570 | $ | 2,224,667 | |||||||||||||||||||||||||||||||||||||||||
Share-based compensation | — | — | — | — | 7,657 | — | — | 7,657 | — | 7,657 | |||||||||||||||||||||||||||||||||||||||||||||||||
Unit-based compensation | — | — | — | — | — | — | — | — | 1,045 | 1,045 | |||||||||||||||||||||||||||||||||||||||||||||||||
Forfeiture and cancellation of common units | — | — | (34,929) | — | — | — | — | — | (110) | (110) | |||||||||||||||||||||||||||||||||||||||||||||||||
Exercise of warrants | 21 | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Shares issued upon vesting of share-based awards, net of tax withholding | 287,491 | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Exchange of Class V shares for Class A shares | 2,051,166 | — | (2,051,166) | — | 17,914 | — | — | 17,914 | (17,914) | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Decrease in deferred tax liability due to tax impact of goodwill and intangible assets impairments | — | — | — | — | 19,056 | — | — | 19,056 | — | 19,056 | |||||||||||||||||||||||||||||||||||||||||||||||||
Currency translation adjustment, net of tax | — | — | — | — | — | — | (228) | (228) | (549) | (777) | |||||||||||||||||||||||||||||||||||||||||||||||||
Unrealized losses on available-for-sale securities | — | — | — | — | — | — | (49) | (49) | (116) | (165) | |||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | (468,132) | — | (468,132) | (1,124,416) | (1,592,548) | |||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of September 30, 2022 | 77,682,402 | $ | 8 | 186,352,843 | $ | 19 | $ | 763,187 | $ | (577,499) | $ | (400) | $ | 185,315 | $ | 473,510 | $ | 658,825 |
4
VPC IMPACT ACQUISITION HOLDINGS
NOTES TO CONDENSED FINANCIAL STATEMENTSSEPTEMBER 30, 2020
Note 1 —
Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | |||||||||||||
Cash flows from operating activities: | ||||||||||||||
Net loss | $ | (147,119) | $ | (1,663,509) | ||||||||||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||||||||
Depreciation and amortization | 10,843 | 18,340 | ||||||||||||
Non-cash lease expense | 2,298 | 1,893 | ||||||||||||
Share-based compensation expense | 14,284 | 28,863 | ||||||||||||
Unit-based compensation expense | 1,300 | 322 | ||||||||||||
Forfeiture and cancellation of common units | (13) | (185) | ||||||||||||
Deferred income taxes | — | (8,858) | ||||||||||||
Impairment of long-lived assets | 56 | 15 | ||||||||||||
Goodwill and intangible assets impairments | 23,325 | 1,547,711 | ||||||||||||
Loss on disposal of assets | 70 | — | ||||||||||||
Loss (gain) from change in fair value of warrant liability | 857 | (13,139) | ||||||||||||
Other | 19 | 213 | ||||||||||||
Changes in operating assets and liabilities: | ||||||||||||||
Accounts receivable | 3,607 | (3,964) | ||||||||||||
Prepaid insurance | 10,772 | 11,629 | ||||||||||||
Deposits with clearinghouse | 14,991 | 1 | ||||||||||||
Accounts payable and accrued liabilities | (14,243) | (10,668) | ||||||||||||
Due to related party | 602 | 284 | ||||||||||||
Deferred revenue | 136 | (2,033) | ||||||||||||
Operating lease liabilities | (2,088) | 4,261 | ||||||||||||
Customer funds payable | 27,632 | 41 | ||||||||||||
Other assets and liabilities | (1,220) | (5,122) | ||||||||||||
Net cash used in operating activities | (53,891) | (93,905) | ||||||||||||
Cash flows from investing activities: | ||||||||||||||
Capitalized internal-use software development costs and other capital expenditures | (7,905) | (22,533) | ||||||||||||
Purchase of available-for-sale securities | (44,599) | (188,759) | ||||||||||||
Proceeds from the maturity of available-for-sale securities | 163,165 | 74,714 | ||||||||||||
Acquisition of Bumped Financial, LLC | (631) | — | ||||||||||||
Acquisition of Apex Crypto LLC, net of cash acquired | (44,320) | — | ||||||||||||
Net cash provided by (used in) investing activities | 65,710 | (136,578) | ||||||||||||
Cash flows from financing activities: | ||||||||||||||
Proceeds from the exercise of warrants | — | 3 | ||||||||||||
Repurchase and retirement of Class A common stock | (2,502) | — | ||||||||||||
Net cash (used in) provided by financing activities | (2,502) | 3 | ||||||||||||
Effect of exchange rate changes | (36) | (968) | ||||||||||||
Net increase (decrease) in cash, cash equivalents, restricted cash and customer funds | 9,281 | (231,448) | ||||||||||||
Cash, cash equivalents, restricted cash and customer funds at the beginning of the period | 115,423 | 408,415 | ||||||||||||
Cash, cash equivalents, restricted cash and customer funds at the end of the period | $ | 124,704 | $ | 176,967 | ||||||||||
Supplemental disclosure of cash flow information: | ||||||||||||||
Non-cash operating lease right-of-use asset acquired | $ | 3,783 | $ | 11,021 | ||||||||||
Supplemental disclosure of non-cash investing and financing activity: | ||||||||||||||
Capitalized internal-use software development costs and other capital expenditures included in accounts payable and accrued liabilities. | 548 | 2,756 | ||||||||||||
Reconciliation of cash, cash equivalents, restricted cash and customer funds to consolidated balance sheets: | ||||||||||||||
Cash and cash equivalents | $ | 68,219 | $ | 159,850 | ||||||||||
Restricted cash | 28,262 | 16,525 | ||||||||||||
Customer funds | 28,223 | 592 | ||||||||||||
Total cash, cash equivalents, restricted cash and customer funds | $ | 124,704 | $ | 176,967 |
In connection with the VIH Business Combination, VIH changed its name to “Bakkt Holdings, Inc.” and changed its jurisdiction of incorporation from the Cayman Islands to the State of Delaware (the “Domestication”).
Crypto Asset | Symbol | ||||
Bitcoin | BTC | ||||
Bitcoin Cash | BCH | ||||
Dogecoin | DOGE | ||||
Ether | ETH | ||||
Ether Classic | ETC | ||||
Litecoin | LTC | ||||
Shiba Inu | SHIB | ||||
USD Coin | USDC |
As of September 30, 2020, the Company had not commenced any operations. All activity for the period from July 31, 2020 (inception) through September 30, 2020 relatesregulatory approvals.
The registration statement forclient's loyalty program into bitcoin (and, in the Company’s Initial Public Offering was declared effectivefuture, into other crypto assets depending on September 22, 2020. On September 25, 2020demand).
Simultaneously with the closingthis year to include more of the Initial Public Offering, the Company consummated the sale of 6,000,000 warrants (the “Private Placement Warrants”) at a price of $1.00 per Private Placement Warrant in a private placement to VPC Impact Acquisition Holdings Sponsor, LLC (the “Sponsor”), generating gross proceeds of $6,000,000,crypto assets which is described in Note 4.
Transaction costs amounted to $11,501,146, consisting of $4,000,000 of underwriting fees, $7,000,000 of deferred underwriting fees and $501,146 of other offering costs. we support for trading.
Following the closing of the Initial Public Offering on September 25, 2020, an amount of $200,000,000 ($10.00 per Unit) from the net proceeds of the sale of the Units in the Initial Public Offeringoption contracts by
On September 29, 2020, the underwriters notified the CompanyApple products and services), gift cards and digital experiences. Our travel solution offers a retail e-commerce booking platform, as well as live-agent booking and servicing. Our platform provides a unified shopping experience that is
The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offeringaccept both points and the sale of the Private Placement Warrants, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. The stock exchange listing rules require that the Business Combination must be with one or more operating businesses or assets with a fair market value equal to at least 80% of the assets held in the Trust Account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the Trust Account). The Company will only complete a Business Combination if the post-Business Combination company owns or acquires 50% or more of the issued and outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act. There is no assurance that the Company will be able to successfully effect a Business Combination.
The Company will provide the holders of the public shares (the “Public Shareholders”) with the opportunity to redeem all or a portion of their public shares upon the completion of the Business Combination, either (i) in connection with a general 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 a Business Combination or conduct a tender offer will be made by the Company, solely in its discretion. The Public Shareholders will be entitled to redeem their Public Shares, equal to the aggregate amount then on deposit in the Trust Account, calculated as of two business days prior to the consummation of the Business Combination (initially $10.00 per Public Share), including interest (which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares, subject to certain limitations as described in the prospectus. The per-share amount to be distributed to the Public Shareholders who properly redeem their shares will not be reduced by the deferred underwriting commissions the Company will pay to the underwriters (as discussed in Note 6). There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s warrants.
5
VPC IMPACT ACQUISITION HOLDINGS
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2020
(Unaudited)
The Company will proceed with a Business Combination only if the Company has net tangible assets of at least $5,000,001 and, if the Company seeks shareholder approval, it receives an ordinary resolution under Cayman Islands law approving a Business Combination, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the Company. If a shareholder vote is not required and the Company does not decide to hold a shareholder vote for business or other legal reasons, the Company will, pursuant to its Amended and Restated 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 containing substantially the same information as would be included in a proxy statement with the SEC prior to completing a Business Combination. If the Company seeks shareholder approval in connection with a Business Combination, the Sponsor has 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 a proposed Business Combination.
Notwithstanding the foregoing, if the Company seeks shareholder approval of the Business Combination and the Company does not conduct redemptions pursuant to the tender offer rules, a Public Shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert orcredit cards as a “group” (as defined under Section 13form of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the Public Shares without the Company’s prior written consent.
The Sponsor has agreed (a) to waive its redemption rights with respect to any Founder Shares and Public Shares held by it in connection with the completion of a Business Combination and (b) not to propose an amendment to the Amended and Restated Memorandum and Articles of Association (i) to modify the substance or timing of the Company’s obligation to allow redemption in connection with the Company’s initial Business Combination or to redeem 100% of the Public Shares if the Company does not complete a Business Combination within the Combination Period (as defined below) or (ii) with respect to any other provision relating to shareholders’ rights or pre-initial business combination activity, unless the Company provides the Public Shareholders with the opportunity to redeem their Public Shares upon approval of any such amendment 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 Trust Account and not previously released to pay taxes, divided by the number of then issued and outstanding Public Shares.
The Company will have until September 25, 2022 to consummate a Business Combination (the “Combination Period”). However, 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 not more than ten business days thereafter, redeem 100% of 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 the Compay to pay its taxes, if any (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then issued and outstanding Public Shares, which redemption will completely extinguish the rights of the Public Shareholders as shareholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining Public Shareholders and its Board of Directors, liquidate and dissolve, 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.
The Sponsor has agreed to waive its rights to liquidating distributions from the Trust Account with respect to the Founder Shares it will receive if the Company fails to complete a Business Combination within the Combination Period. However, if the Sponsor or any of its respective affiliates acquire Public Shares, such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination within the Combination Period. The underwriters have agreed to waive their rights to their deferred underwriting commission (see Note 6) held in the Trust Account in the event the Company does not complete a Business Combination within the Combination Period, and in such event, such amounts will be included with the other funds held in the Trust Account that will be available to fund the redemption of the Public Shares. In the event of such distribution, it is possible that the per share value of the assets remaining available for distribution will be less than the Initial Public Offering price per Unit ($10.00).
In order to protect the amounts held in the Trust Account, the Sponsor has agreed that it will be liable to the Company if and to the extent any claims by a third party (other than the Company’s independent registered public accounting firm) 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 the lesser of (1) $10.00 per Public Share and (2) the actual amount per Public Share held in the Trust Account as of the date of the liquidation of the Trust Account, if less than $10.00 per Public Share, due to reductions in the value of trust assets, in each case net of the interest that may be withdrawn to pay taxes. This liability will not apply to any claims by a third party who executed a
6
VPC IMPACT ACQUISITION HOLDINGS
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2020
(Unaudited)
waiver of any and all rights to seek access to the Trust Account and as to any claims under the Company’s indemnity of the underwriters of the Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). 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 (other than the Company’s independent registered public accounting firm), prospective target businesses or 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.
Note 2 —
The accompanying unaudited condensedyear ending December 31, 2023, or for any other future annual or interim period. These consolidated financial statements should be read in conjunction with the Company’s prospectus for its Initial Public Offering as filed with the SEC on September 24, 2020, as well as the Company’s Current Reports on Form 8-K, as filed with the SEC on September 28, 2020, and October 1, 2020. The interim results for the period from July 31, 2020 (inception) through September 30, 2020 are not necessarily indicative of the results to be expected for the period ending December 31, 2020 or for any future interim 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 proxyaudited financial statements and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
Further, 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 a 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 differencesaccompanying notes thereto included in accounting standards used.
our Form 10-K.
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.
7
VPC IMPACT ACQUISITION HOLDINGS
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2020
(Unaudited)
Cashnormal course of business 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 September 30, 2020.
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 Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” 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 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 September 30, 2020, Class A ordinary shares subject to possible redemption are presented as temporary equity, outside of the shareholders’ equity section of the Company’s condensed balance sheet.
Offering Costs
Offering costs consist of legal, accounting, underwriting fees and other costs incurred through the Initial Public Offering that are directly related to the Initial Public Offering. Offering costs amounting to $11,501,146 were charged to shareholders’ equity upon the completion of the Initial Public Offering.
Income Taxes
The Company accounts for income taxes under ASC Topic 740, “Income Taxes,” which 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’s management determined that the Cayman Islands is the Company’s major tax jurisdiction. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. As of September 30, 2020, there were no unrecognized tax benefits and no amounts accrued for interest and penalties. 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 considered to be an exempted Cayman Islands company with no connection to any other taxable jurisdiction 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.
Net Income (Loss) Per Ordinary Share
The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share”. Net income (loss) per share is computed by dividing net income (loss) by the weighted average number of ordinary shares outstanding for the period. The calculation of diluted income (loss) per share does not consider the effect of the warrants issued in connection with the (i) Initial Public Offering, and (ii) Private Placement Warrants since the exercise of the warrants are contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive. The warrants are exercisable to purchase 16,000,000 shares of Class A ordinary shares in the aggregate.
The Company’s statement of operations includes a presentation of income (loss) per share for ordinary shares subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income per share, basic and diluted, for Class A redeemable ordinary shares is calculated by dividing the interest income earned on the Trust Account of approximately $200 for the period from July 31, 2020 (inception) through September 30, 2020 by the weighted average number of Class A redeemable ordinary shares outstanding for the period. Net loss per share, basic and diluted, for Class B non-redeemable ordinary shares is calculated by dividing the net loss, adjusted for income attributable to Class A redeemable ordinary shares of approximately $200, by the weighted average number of Class B non-redeemable ordinary shares outstanding for the period. Class B non-redeemable ordinary shares includes the Founder Shares as these shares do not have any redemption features and do not participate in the income earned on the Trust Account.
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 has not experienced losses on this account and management believes the Company is not exposed to significant risks on such account.
8
VPC IMPACT ACQUISITION HOLDINGS
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2020
(Unaudited)
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 condensed balance sheet, primarily due to their short-term nature.
Recent Accounting Standards
Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed financial statements.
Note 3 — Initial Public Offering
Pursuant to the Initial Public Offering, the Company sold 20,000,000 Units, at a purchase price of $10.00 per Unit. In connection with the underwriters’ partial exercise of the over-allotment option on October 1, 2020, the Company sold an additional 737,202 Units, at a purchase price of $10.00 per Unit (see Note 9). Each Unit consists of one Class A ordinary share and one-half of one redeemable warrant (“Public Warrant”). Each whole Public Warrant entitles the holder to purchase one Class A ordinary share at an exercise price of $11.50 per whole share (see Note 7).
Note 4 — Private Placement
Simultaneously with the closing of the Initial Public Offering, the Sponsor purchased an aggregate of 6,000,000 Private Placement Warrants at a price of $1.00 per Private Placement Warrant, for an aggregate purchase price of $6,000,000. In connection with the underwriters’ partial exercise of the over-allotment option on October 1, 2020, the Company sold an additional 147,440 Private Placement Warrants, at a purchase price of $1.00 per Private Placement Warrants, for an aggregate purchase price of $147,440 (see Note 9). 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). A portion of the proceeds from the Private Placement Warrants were added to the 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 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 August 3, 2020, the Sponsor paid $25,000 to cover certain offering and formation costs of the Company in consideration for 5,750,000 Class B ordinary shares (the “Founder Shares”). In September 2020, the Sponsor transferred an aggregate of 60,000 Founder Shares to members of the Company’s board of directors, resulting in the Sponsor holding 5,690,000 Founder Shares. The Founder Shares included an aggregate of up to 750,000 shares that were subject to forfeiture depending on the extent to which the underwriters’ over-allotment option was exercised, so that the number of Founder Shares would equal, on an as-converted basis, approximately 20% of the Company’s issued and outstanding ordinary shares after the Initial Public Offering. In connection with the underwriters’ partial exercise of the over-allotment option and the forfeiture of the remaining over-allotment option, 565,700 Founder Shares were forfeited and 184,300 Founder Shares are no longer subject to forfeiture resulting in an aggregate of 5,184,300 Founder Shares outstanding at October 1, 2020. All share amounts have been retroactively restated to reflect the forfeiture.
The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of the Founder Shares until the earliest of: (A) one year after the completion of a Business Combination and (B) subsequent to a Business Combination, (x) if the closing price of the Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after a Business Combination, or (y) the date on which the Company completes a liquidation, merger, share exchange or other similar transaction that results in all of the Public Shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property.
Promissory Note—Related Party
On August 3, 2020, the Company issued an unsecured promissory note (the “Promissory Note”) to the Sponsor, pursuant to which the Company may borrow up to an aggregate principal amount of $300,000. The Promissory Note was non-interest bearing and payable on the earlier of (i) December 31, 2020 and (ii) the completion of the Initial Public Offering. The outstanding balance under the Promissory Note of $82,729 was repaid at the closing of the Initial Public Offering on September 25, 2020.
9
VPC IMPACT ACQUISITION HOLDINGS
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2020
(Unaudited)
Administrative Services Agreement
Commencing on September 25, 2020, the Company entered into an agreement to pay the Sponsor up to $10,000 per month for office space, utilities, secretarial and administrative support services. Upon completion of a Business Combination or its liquidation, the Company will cease paying these monthly fees.
Related Party Loans
In order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). Such Working Capital Loans would be evidenced by promissory notes. The notes may be repaid upon completion of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of notes may be converted upon completion of a Business Combination into warrants at a price of $1.00 per warrant. Such warrants would be identical to the Private Placement Warrants. In the event that a 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. As of September 30, 2020, the Company had no outstanding borrowings under the Working Capital Loans.
Note 6 — Commitments and Contingencies
Risks and Uncertainties
Management continues to evaluate the impact of the COVID-19 global 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 financial statements. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of the uncertainties described below.
Registrationmethodology, we evaluate whether the mitigating effect of its plans sufficiently alleviates substantial doubt about our ability to continue as a going concern. The mitigating effect of management’s plans, however, is only considered if both (1) it is probable that the plans will be effectively implemented within one year after the date that the financial statements are issued, and Shareholders Rights
Pursuant(2) it is probable that the plans, when implemented, will mitigate the relevant conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that these consolidated financial statements are issued.
Service Type | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | ||||||||||||||||||||||
Transaction revenue(a) | $ | 198,526 | $ | 6,927 | $ | 548,774 | $ | 21,477 | ||||||||||||||||||
Subscription and service revenue | 6,248 | 6,286 | 16,848 | 18,839 | ||||||||||||||||||||||
Total revenue | $ | 204,774 | $ | 13,213 | $ | 565,622 | $ | 40,316 |
Platform | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | ||||||||||||||||||||||
Loyalty redemption platform | $ | 13,024 | $ | 12,742 | $ | 38,096 | $ | 38,852 | ||||||||||||||||||
Crypto services(b) | 191,750 | 471 | 527,526 | 1,464 | ||||||||||||||||||||||
Total revenue | $ | 204,774 | $ | 13,213 | $ | 565,622 | $ | 40,316 |
Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | ||||||||||
Beginning of the period contract liability | $ | 7,084 | $ | 9,448 | |||||||
Revenue recognized from contract liabilities included in the beginning balance | (3,055) | (3,629) | |||||||||
Increases due to cash received, net of amounts recognized in revenue during the period | 3,191 | 1,596 | |||||||||
End of the period contract liability | $ | 7,220 | $ | 7,415 |
($ in millions) | ||||||||
Cash consideration paid | 55.0 | |||||||
Cash paid for working capital and cash | 12.2 | |||||||
Class A common stock at transaction close | 9.1 | |||||||
Estimated fair value of Class A common stock contingent consideration | 2.9 | |||||||
Total consideration | $ | 79.2 | ||||||
Current assets | 32.0 | |||||||
Safeguarding asset for crypto | 682.2 | |||||||
Property, equipment and software, net | 0.1 | |||||||
Non-current assets | 0.3 | |||||||
Intangible assets - developed technology | 5.6 | |||||||
Intangible assets - customer relationships | 10.2 | |||||||
Goodwill | 51.0 | |||||||
Current liabilities | (20.0) | |||||||
Safeguarding obligation for crypto | (682.2) | |||||||
Net assets acquired | $ | 79.2 |
Balance as of December 31, 2022 | $ | 15,852 | |||
Apex acquisition | 50,648 | ||||
Balance as of September 30, 2023 | $ | 66,500 |
Underwritingthe following (in thousands):
September 30, 2023 | |||||||||||||||||||||||||||||
Weighted Average Useful Life (in years) | Gross Carrying Amount | Accumulated Amortization | Impairment | Net Carrying Amount | |||||||||||||||||||||||||
Licenses | Indefinite | $ | 611 | $ | — | $ | — | $ | 611 | ||||||||||||||||||||
Trademarks / trade names | Indefinite | 8,000 | — | (3,700) | 4,300 | ||||||||||||||||||||||||
Technology | 5 | 18,360 | (5,558) | (3,069) | 9,733 | ||||||||||||||||||||||||
Customer relationships | 8.4 | 55,170 | (11,520) | (16,556) | 27,094 | ||||||||||||||||||||||||
Total | $ | 82,141 | $ | (17,078) | $ | (23,325) | $ | 41,738 |
December 31, 2022 | |||||||||||||||||||||||||||||
Weighted Average Useful Life (in years) | Gross Carrying Amount | Accumulated Amortization | Impairment | Net Carrying Amount | |||||||||||||||||||||||||
Licenses | Indefinite | $ | 241,320 | $ | — | $ | (241,320) | $ | — | ||||||||||||||||||||
Trademarks / trade names | Indefinite | 39,470 | — | (31,470) | 8,000 | ||||||||||||||||||||||||
Technology | 4.2 | 67,310 | (19,605) | (38,035) | 9,670 | ||||||||||||||||||||||||
Customer relationships | 8 | 44,970 | (6,807) | — | 38,163 | ||||||||||||||||||||||||
Total | $ | 393,070 | $ | (26,412) | $ | (310,825) | $ | 55,833 |
September 30, 2023 | |||||
Remainder of 2023 | $ | 1,654 | |||
2024 | 6,581 | ||||
2025 | 6,564 | ||||
2026 | 6,234 | ||||
2027 | 5,021 | ||||
Thereafter | 10,773 | ||||
Total | $ | 36,827 |
September 30, 2023 | December 31, 2022 | ||||||||||
Trade accounts receivable | $ | 12,596 | $ | 16,284 | |||||||
Deposits at brokers or dealers | 1,590 | — | |||||||||
Crypto receivable from liquidity providers | 186 | — | |||||||||
Unbilled receivables | 6,003 | 6,445 | |||||||||
Other receivables | 1,864 | 2,787 | |||||||||
Total accounts receivable | 22,239 | 25,516 | |||||||||
Less: allowance for doubtful accounts | (540) | (210) | |||||||||
Total | $ | 21,699 | $ | 25,306 |
September 30, 2023 | December 31, 2022 | ||||||||||
Prepaid expenses | $ | 7,297 | $ | 6,060 | |||||||
Other | 32 | — | |||||||||
Total | $ | 7,329 | $ | 6,060 |
September 30, 2023 | December 31, 2022 | ||||||||||
Internal-use software | $ | 8,218 | $ | 4,383 | |||||||
Purchased software | 105 | 99 | |||||||||
Office furniture and equipment | 2,311 | 2,303 | |||||||||
Other computer and network equipment | 5,132 | 4,732 | |||||||||
Leasehold improvements | 10,280 | 10,102 | |||||||||
Property, equipment and software, gross | 26,046 | 21,619 | |||||||||
Less: accumulated amortization and depreciation | (5,538) | (1,875) | |||||||||
Total | $ | 20,508 | $ | 19,744 |
September 30, 2023 | December 31, 2022 | ||||||||||
Operating lease right-of-use assets | $ | 21,116 | $ | 19,632 | |||||||
Other | 2,556 | 2,826 | |||||||||
Total | $ | 23,672 | $ | 22,458 |
September 30, 2023 | December 31, 2022 | ||||||||||
Accounts payable | $ | 3,729 | $ | 25,975 | |||||||
Payables to clients | 70 | — | |||||||||
Accrued expenses | 19,116 | 15,537 | |||||||||
Purchasing card payable | 12,502 | 10,686 | |||||||||
Salaries and benefits payable | 8,019 | 13,926 | |||||||||
Loyalty revenue share liability | 3,479 | 43 | |||||||||
Other | 2,277 | 620 | |||||||||
Total | $ | 49,192 | $ | 66,787 |
September 30, 2023 | December 31, 2022 | ||||||||||
Participation units liability, current | $ | 221 | $ | 275 | |||||||
Current maturities of operating lease liability | 3,555 | 3,014 | |||||||||
Other | 527 | 530 | |||||||||
Total | $ | 4,303 | $ | 3,819 |
September 30, 2023 | December 31, 2022 | ||||||||||
Operating lease liability, noncurrent | $ | 24,547 | $ | 23,402 | |||||||
Contingent consideration | 13,065 | — | |||||||||
Total | $ | 37,612 | $ | 23,402 |
The Company granted the underwriters a 45-day option to purchase up to 3,000,000 additional Units to cover over-allotments at the Initial Public Offering price, less the underwriting discounts and commissions.
The underwriters are entitled toas a deferred fee of $0.35 per Unit, or $7,000,000 in the aggregate (see Note 9). The deferred fee will become payable“Paired Interest.” Pursuant to the underwritersTRA, among other things, holders of Opco common units may, subject to certain conditions, from the amounts held in the Trust Account solely in the event that the Company completesand after April 16, 2022, exchange such Paired Interests for Class A common stock on a Business Combination,one-for-one basis, subject to the terms of the underwriting agreement.
Note 7 — Shareholders’ Equity
Preference Shares—The Company is authorizedExchange Agreement, including our right to issue 1,000,000 preference shares with a par value of $0.0001 per share, with such designations, voting and other rights and preferences as may be determined from timeelect to time by the Company’s board of directors. At September 30, 2020, there were no preference shares issued or outstanding.
Class A Ordinary Shares—The Company is authorized to issue 200,000,000 Class A ordinary shares, with a par value of $0.0001 per share. Holdersdeliver cash in lieu of Class A ordinary shares are entitled to one votecommon stock and, in certain cases, adjustments as set forth therein. Opco will have in effect an election under Section 754 of the Internal Revenue Code for each share. Attaxable year in which an exchange of Opco common units for Class A common stock (or cash) occurs.
Class B Ordinary Shares—The Company is authorized to issue 20,000,000 Class B ordinary shares, with a par value of $0.0001 per share. Holders of the Class B ordinary shares are entitled to one vote for each share. At September 30, 2020, there were 5,184,300 Class B ordinary shares issued and outstanding, of which an aggregate of up to 750,000 shares were subject to forfeiture depending on the extent to which the underwriters’ over-allotment option was exercised, so that the number of Class B ordinary shares would equal 20% of the Company’s issued and outstanding ordinary shares after the Initial7,140,808 public warrants outstanding. Public Offering (see Note 9).
10
VPC IMPACT ACQUISITION HOLDINGS
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2020
(Unaudited)
Only holders of the Class B ordinary shares will have the right to vote on the appointment of directors prior to the Business Combination. Holders of Class A ordinary shares and Class B ordinary shares will vote together as a single class on all other matters submitted to a vote of shareholders, except as required by law and except that in a vote to continue the Company in a jurisdiction outside the Cayman Islands, holders of Class B ordinary shares will have ten votes per share and holders of Class A ordinary shares will have one vote per share.
The Class B ordinary shares will automatically convert into Class A ordinary shares concurrently with or immediately following the consummation of a 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 connection with a Business Combination, the number of Class A ordinary shares issuable upon conversion of all Founder Shares will equal, in the aggregate, 20% of the total number of Class A ordinary shares outstanding after such conversion (after giving effect to any redemptions of Class A ordinary shares by Public Shareholders), including the total number of Class A ordinary shares issued, or deemed issued or issuable upon conversion or exercise of any equity-linked securities or rights issued or deemed issued, by the Company in connection with or in relation to the consummation of a Business Combination, excluding any Class A ordinary shares or equity-linked securities exercisable for or convertible into Class A ordinary shares issued, or to be issued, to any seller in a Business Combination and any Private Placement Warrants issued to the Sponsor, officers or directors upon conversion of Working Capital Loans; provided that such conversion of Founder Shares will never occur on a less than one-for-one basis.
Warrants—Public Warrantswarrants may only be exercised for a whole number of shares. No fractional shares will be issued upon exercise of the Public Warrants.public warrant. Each warrant entitles its holders to purchase one share of Class A common stock at an exercise price of $11.50 per share. The Public Warrants will becomepublic warrants became exercisable on the later of (a) 30 days after the completion of a Business Combination and (b) one year from the closing of the Initial Public Offering.November 15, 2021. The Public Warrantspublic warrants will expire five years from the completion of a Business Combinationon October 15, 2026, or earlier upon redemption or liquidation.
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. No warrant will be exercisable and the Company will not be obligated to issue a Class A ordinary share upon exercise of a warrant unless the Class A ordinary share 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.
The Company has agreed that as soon as practicable, but in no event later than 15 business days, after the closing of a Business Combination, it will use its best 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. The Company will use its best efforts to cause the same to become effective and to maintain the effectiveness of such registration statement and a current prospectus relating thereto until the expiration of the warrants in accordance with the provisions of the warrant agreement. If a registration statement covering the Class A ordinary shares issuable upon exercise of the warrants is not effective by the sixtieth (60th) business day after the closing of a 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. Notwithstanding the above, 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, and in the event the Company does not so elect, it will use its best 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 warrants become exercisable, the Company We may redeem the outstanding warrants (exceptwhen various conditions are met, such as describedspecific stock prices, as detailed in the specific warrant agreements. The warrants are recorded as a liability and reflected as “Warrant liability” in the consolidated balance sheets.
Common Stock
at
upon a minimum of 30 days’ prior written notice of redemption to each warrant holder; and
if, and only if, the closing price ofpreference over the Class A ordinarycommon stock, then outstanding, if any.
11
VPC IMPACT ACQUISITION HOLDINGS
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBERSeptember 30, 2020
(Unaudited)
If2023 and when the warrants become redeemable by the Company, the Company may exercise its redemption right even if it is unable to registerDecember 31, 2022, there were 183,249,426 and 183,482,777 shares of Class V common stock issued and outstanding, respectively.
Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00. Once the warrants become exercisable, the Company may redeem the outstanding warrants (except as described with respect to the Private Placement Warrants):
in whole and not in part;
at a price of $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 determined basedpaid on the redemption date and the fair market value of the Class A ordinary shares;
if, and only if, the closing price of the Class A ordinary shares equals or exceeds $10.00 per public share (as adjusted) for any 20 trading days within the 30-trading day period ending three trading days before the Company send the notice of redemption of the warrant holders; and
if the closing price of the Class A ordinary shares for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders is less than $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading “Description of Securities—Warrants—Public Warrants—Anti-dilution Adjustments”), the private placement warrants must also be concurrently called for redemption on the same terms as the outstanding public warrants, as described above.
If the Company calls the Public Warrants for redemption, as described above, its management will have the option to require any holder that wishes to exercise the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of ordinary shares issuable upon exercise of the Public Warrants may be adjusted in certain circumstances including inIn the event of a share dividend, extraordinary dividendany voluntary or recapitalization, reorganization, mergerinvoluntary liquidation, dissolution or consolidation. However, except as described below,winding up of our affairs, the Public Warrants willholders of Class V common stock shall not be adjusted for issuances of ordinary shares at a price below its exercise price. Additionally, in no event will the Company be requiredentitled to net cash settle the Public Warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of Public Warrants will not receive any of our assets.
In addition, if (x) the Company issues additional Class A ordinary shares or equity-linked securities for capital raising purposesV common stock, other than in connection with the closingvalid issuance or transfer of aOpco common units in accordance with Opco’s Third Amended and Restated Limited Liability Company Agreement (the “LLC Agreement”).
September 30, 2023 | December 31, 2022 | ||||||||||||||||
Opco Common Units | Ownership % | Opco Common Units | Ownership % | ||||||||||||||
Opco common units held by Bakkt Holdings, Inc. | 91,414,923 | 34 | % | 80,926,843 | 31 | % | |||||||||||
Opco common units held by noncontrolling interest holders | 183,249,426 | 66 | % | 183,482,777 | 69 | % | |||||||||||
Total Opco common units outstanding | 274,664,349 | 100 | % | 264,409,620 | 100 | % |
RSUs and PSUs | Number of RSUs and PSUs | Weighted Average Remaining Contractual Term (years) | Weighted Average Grant Date Fair Value | Aggregate Intrinsic Value | |||||||||||||||||||
Outstanding as of December 31, 2022 | 13,782 | 2.05 | $ | 4.05 | |||||||||||||||||||
Granted | 8,457 | $ | 1.49 | $ | 12,596 | ||||||||||||||||||
Forfeited | (3,635) | ||||||||||||||||||||||
Vested | (5,282) | ||||||||||||||||||||||
Outstanding as of September 30, 2023 | 13,322 | 1.57 | $ | 2.93 |
The Private Placement Warrants are identical to the Public Warrants underlying the Units soldCompany's restructuring efforts is included in “Restructuring expenses” in the Initial Public Offering, except that the Private Placement Warrants and the Class A ordinary shares issuable upon the exerciseconsolidated statements of the Private Placement Warrants will not be transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and be non-redeemable, except as described above, so long as they are held by the initial purchasers or their permitted transferees. 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 and exercisable by such holders on the same basis as the Public Warrants.
12
VPC IMPACT ACQUISITION HOLDINGS
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2020
(Unaudited)
Note 8 — Fair Value Measurements
At September 30, 2020, assets held in the Trust Account were comprised of $200,000,164 in money market funds which are invested primarily in U.S. Treasury Securities.
The fair value of the Company’sRSUs and PSUs used in determining share-based compensation expense is based on the closing price of our common stock on the grant date.
Type of unit | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | |||||||||||||||||||
Common incentive unit | $ | 372 | $ | 950 | $ | 1,291 | $ | 3,041 | |||||||||||||||
Participation unit | (32) | 74 | (4) | (2,904) | |||||||||||||||||||
Total | $ | 340 | $ | 1,024 | $ | 1,287 | $ | 137 |
Common Incentive Units | Number of Common Incentive Units | Weighted Average Remaining Contractual Term (years) | Weighted Average Grant Date Fair Value | Aggregate Intrinsic Value | ||||||||||
Outstanding as of December 31, 2022 | 8,294 | 0.79 | $ | 6.30 | $ | 67,635 | ||||||||
Granted | — | |||||||||||||
Forfeited | (5) | |||||||||||||
Exchanged | (229) | |||||||||||||
Outstanding as of September 30, 2023 | 8,060 | 0.04 | $ | 6.30 | $ | 65,727 |
Common Incentive Units | Number of Common Incentive Units | Weighted Average Remaining Contractual Term (years) | Weighted Average Grant Date Fair Value | Aggregate Intrinsic Value | ||||||||||
Outstanding as of December 31, 2021 | 16,339 | 1.79 | $ | 6.30 | $ | 133,240 | ||||||||
Granted | — | |||||||||||||
Forfeited | (313) | |||||||||||||
Exchanged | (7,041) | |||||||||||||
Outstanding as of September 30, 2022 | 8,985 | 1.04 | $ | 6.30 | $ | 72,349 |
Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | ||||||||||||||||||||
Net Loss per share: | |||||||||||||||||||||||
Numerator – basic and diluted: | |||||||||||||||||||||||
Net loss | $ | (51,749) | $ | (1,592,548) | $ | (147,119) | $ | (1,663,509) | |||||||||||||||
Less: Net loss attributable to noncontrolling interest | (34,418) | (1,124,416) | (98,964) | (1,184,352) | |||||||||||||||||||
Net loss attributable to Bakkt Holdings, Inc. – basic | (17,331) | (468,132) | (48,155) | (479,157) | |||||||||||||||||||
Net loss and tax effect attributable to noncontrolling interests | — | — | — | — | |||||||||||||||||||
Net loss attributable to Bakkt Holdings, Inc. – diluted | $ | (17,331) | $ | (468,132) | $ | (48,155) | $ | (479,157) | |||||||||||||||
Denominator – basic and diluted: | |||||||||||||||||||||||
Weighted average shares outstanding – basic | 91,357,858 | 76,591,676 | 87,726,210 | 68,408,530 | |||||||||||||||||||
Weighted average shares outstanding – diluted | 91,357,858 | 76,591,676 | 87,726,210 | 68,408,530 | |||||||||||||||||||
Net loss per share – basic | $ | (0.19) | $ | (6.11) | $ | (0.55) | $ | (7.00) | |||||||||||||||
Net loss per share – diluted | $ | (0.19) | $ | (6.11) | $ | (0.55) | $ | (7.00) |
As of September 30, 2023 | |||||
RSUs and PSUs | 13,026 | ||||
Public warrants | 7,141 | ||||
Participation units | 189 | ||||
Opco warrants | 793 | ||||
Opco unvested incentive units | 2,125 | ||||
Opco common units | 181,125 | ||||
Total | 204,398 |
Payments Due by Period | |||||||||||||||||||||||||||||
Less than 1 year | 1-3 years | 3-5 years | More than 5 years | Total | |||||||||||||||||||||||||
Purchase obligations | $ | 4,050 | $ | 19,100 | $ | — | $ | — | $ | 23,150 |
The following table presents information about the Company’s assets that are measured at fair value on a recurring basis are classified as Level 1, Level 2 and Level 3 as follows (in thousands):
As of September 30, 2023 | ||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||
Assets: | ||||||||||||||
U.S. Treasury debt securities | $ | 22,678 | $ | 22,678 | $ | — | $ | — | ||||||
Safeguarding asset for crypto | 505,697 | — | 505,697 | — | ||||||||||
Total Assets | $ | 528,375 | $ | 22,678 | $ | 505,697 | $ | — | ||||||
Liabilities: | ||||||||||||||
Safeguarding obligation for crypto | 505,697 | — | 505,697 | — | ||||||||||
Contingent consideration | 13,065 | — | — | 13,065 | ||||||||||
Warrant liability—public warrants | 1,642 | 1,642 | — | — | ||||||||||
Total Liabilities | $ | 520,404 | $ | 1,642 | $ | 505,697 | $ | 13,065 |
As of December 31, 2022 | ||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||
Assets: | ||||||||||||||
U.S. Treasury debt securities | $ | 141,062 | $ | 141,062 | $ | — | $ | — | ||||||
Safeguarding asset for crypto | 15,792 | — | 15,792 | — | ||||||||||
Total Assets | $ | 156,854 | $ | 141,062 | $ | 15,792 | $ | — | ||||||
Liabilities: | ||||||||||||||
Safeguarding obligation for crypto | $ | 15,792 | $ | — | $ | 15,792 | $ | — | ||||||
Warrant liability—public warrants | 785 | 785 | — | — | ||||||||||
Total Liabilities | $ | 16,577 | $ | 785 | $ | 15,792 | $ | — |
September 30, 2023 | December 31, 2022 | ||||||||||
Bitcoin | $ | 178,726 | $ | 15,717 | |||||||
Ether | 148,733 | 75 | |||||||||
Shiba Inu | 105,181 | — | |||||||||
Dogecoin | 53,626 | — | |||||||||
Other | 19,431 | — | |||||||||
Safeguarding obligation for crypto | $ | 505,697 | $ | 15,792 | |||||||
Safeguarding asset for crypto | $ | 505,697 | $ | 15,792 |
September 30, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||||||||
Available-for-sale securities | Cost Basis | Unrealized Gains/(Losses), net | Fair Value | Cost Basis | Unrealized Gains/(Losses), net | Fair Value | |||||||||||||||||||||||||||||
Government debt | |||||||||||||||||||||||||||||||||||
U.S. treasury bonds | 22,600 | 78 | 22,678 | 141,003 | 59 | 141,062 | |||||||||||||||||||||||||||||
Total available-for-sale securities | $ | 22,600 | $ | 78 | $ | 22,678 | $ | 141,003 | $ | 59 | $ | 141,062 |
September 30, 2023 | December 31, 2022 | ||||||||||||||||||||||
Available-for-sale securities in an unrealized loss position | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | |||||||||||||||||||
Government debt | |||||||||||||||||||||||
U.S. treasury bonds: | |||||||||||||||||||||||
Less than 12 months(1) | $ | — | $ | — | $ | 39,574 | $ | (381) | |||||||||||||||
12 months or more(1) | — | — | — | — | |||||||||||||||||||
Total available-for-sale securities | $ | — | $ | — | $ | 39,574 | $ | (381) | |||||||||||||||
(1) Indicates the length of time that individual securities have been in a continuous unrealized loss position. |
Description | Level | September 30, 2020 | ||||||
Assets: | ||||||||
Marketable securities held in Trust Account – U.S. Treasury Securities Money Market Fund | 1 | $ | 200,000,164 |
Note 9 — call obligations.
September 30, 2023 | |||||||||||
Cost Basis | Fair Value | ||||||||||
Due in one year or less | $ | 22,600 | $ | 22,678 | |||||||
Due after one year through five years | — | — | |||||||||
Total debt securities - available-for-sale | $ | 22,600 | $ | 22,678 |
The Company
On September 29, 2020, the underwriters notified the Company
|
References in this report (the “Quarterly Report”) to “we,” “us” or the “Company” refer to VPC Impact Acquisition Holdings. References to our “management” or our “management team” refer to our officers
Special Note Regarding Forward-Looking Statements
This Quarterly Report 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”) that are not historical facts, and involve risks and uncertainties thatinformation currently available to, our management. Actual results could cause actual results to differ materially from those expectedcontemplated by the forward-looking statements.
Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | ||||||||||||||||||||
Revenues: | |||||||||||||||||||||||
Crypto services | $ | 191,750 | $ | 471 | $ | 527,526 | $ | 1,464 | |||||||||||||||
Loyalty services, net | 13,024 | 12,742 | 38,096 | 38,852 | |||||||||||||||||||
Total revenues | 204,774 | 13,213 | 565,622 | 40,316 | |||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Crypto costs | 189,428 | 353 | 521,601 | 1,352 | |||||||||||||||||||
Execution, clearing and brokerage fees | 697 | — | 2,902 | — | |||||||||||||||||||
Compensation and benefits | 24,608 | 37,800 | 85,818 | 107,135 | |||||||||||||||||||
Professional services | 1,962 | 2,707 | 7,204 | 9,291 | |||||||||||||||||||
Technology and communication | 5,536 | 4,137 | 15,647 | 12,659 | |||||||||||||||||||
Selling, general and administrative | 7,447 | 7,792 | 21,722 | 26,995 | |||||||||||||||||||
Acquisition-related expenses | (739) | 454 | 17,053 | 1,148 | |||||||||||||||||||
Depreciation and amortization | 3,959 | 6,391 | 10,843 | 18,340 | |||||||||||||||||||
Related party expenses | 1,033 | 267 | 3,145 | 901 | |||||||||||||||||||
Goodwill and intangible assets impairments | 23,325 | 1,547,711 | 23,325 | 1,547,711 | |||||||||||||||||||
Impairment of long-lived assets | 56 | 15 | 56 | 15 | |||||||||||||||||||
Restructuring expenses | — | — | 4,471 | — | |||||||||||||||||||
Other operating expenses | 322 | 487 | 1,231 | 1,706 | |||||||||||||||||||
Total operating expenses | 257,578 | 1,608,099 | 714,962 | 1,727,238 | |||||||||||||||||||
Operating loss | (52,804) | (1,594,886) | (149,340) | (1,686,922) | |||||||||||||||||||
Interest income, net | 1,177 | 623 | 3,502 | 838 | |||||||||||||||||||
(Loss) gain from change in fair value of warrant liability | (214) | 428 | (857) | 13,139 | |||||||||||||||||||
Other income, net | 379 | 696 | 33 | 607 | |||||||||||||||||||
Loss before income taxes | (51,462) | (1,593,139) | (146,662) | (1,672,338) | |||||||||||||||||||
Income tax benefit (expense) | (231) | 606 | (401) | 8,844 | |||||||||||||||||||
Net loss | $ | (51,693) | $ | (1,592,533) | $ | (147,063) | $ | (1,663,494) | |||||||||||||||
Less: Net loss attributable to noncontrolling interest | (34,418) | (1,124,416) | (98,964) | (1,654,650) | |||||||||||||||||||
Net loss attributable to Bakkt Holdings, Inc. | (17,275) | (468,117) | (48,099) | (8,844) | |||||||||||||||||||
Net loss per share attributable to Class A common stockholders. | |||||||||||||||||||||||
Basic | $ | (0.19) | $ | (6.11) | $ | (0.55) | $ | (7.00) | |||||||||||||||
Diluted | $ | (0.19) | $ | (6.11) | $ | (0.55) | $ | (7.00) |
($ in thousands) | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Total revenues | $ | 204,774 | $ | 13,213 | $ | 191,561 | n/m |
($ in thousands) | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Crypto costs | $ | 189,428 | $ | 353 | $ | 189,075 | n/m |
($ in thousands) | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Execution, clearing and brokerage fees | $ | 697 | $ | — | $ | 697 | n/m |
($ in thousands) | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Compensation and Benefits | $ | 24,608 | $ | 37,800 | $ | (13,192) | (34.9 | %) |
($ in thousands) | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Professional Services | $ | 1,962 | $ | 2,707 | $ | (745) | (27.5 | %) |
($ in thousands) | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Technology and Communication | $ | 5,536 | $ | 4,137 | $ | 1,399 | 33.8 | % |
($ in thousands) | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Selling, General and Administrative | $ | 7,447 | $ | 7,792 | $ | (345) | (4.4 | %) |
($ in thousands) | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Acquisition-related expenses | $ | (739) | $ | 454 | $ | (1,193) | n/m |
($ in thousands) | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Depreciation and amortization | $ | 3,959 | $ | 6,391 | $ | (2,432) | (38.1 | %) |
($ in thousands) | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Related party expenses | $ | 1,033 | $ | 267 | $ | 766 | 286.9 | % |
($ in thousands) | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Goodwill and intangible assets impairments | $ | 23,325 | $ | 1,547,711 | $ | (1,524,386) | n/m |
($ in thousands) | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
(Loss) gain from change in fair value of warrant liability | $ | (214) | $ | 428 | $ | (642) | n/m |
($ in thousands) | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Other income, net | $ | 379 | $ | 696 | $ | (317) | (45.5 | %) |
($ in thousands) | Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Income tax (expense) benefit | $ | (231) | $ | 606 | $ | (837) | (138.1 | %) |
($ in thousands) | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Total revenues | $ | 565,622 | $ | 40,316 | $ | 525,306 | n/m |
($ in thousands) | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Crypto costs | $ | 521,601 | $ | 1,352 | $ | 520,249 | n/m |
($ in thousands) | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Execution, clearing and brokerage fees | $ | 2,902 | $ | — | $ | 2,902 | n/m |
($ in thousands) | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Compensation and Benefits | $ | 85,818 | $ | 107,135 | $ | (21,317) | (19.9 | %) |
($ in thousands) | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Professional Services | $ | 7,204 | $ | 9,291 | $ | (2,087) | (22.5 | %) |
($ in thousands) | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Technology and Communication | $ | 15,647 | $ | 12,659 | $ | 2,988 | 23.6 | % |
($ in thousands) | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Selling, General and Administrative | $ | 21,722 | $ | 26,995 | $ | (5,273) | (19.5 | %) |
($ in thousands) | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Acquisition-related expenses | $ | 17,053 | $ | 1,148 | $ | 15,905 | n/m |
($ in thousands) | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Depreciation and amortization | $ | 10,843 | $ | 18,340 | $ | (7,497) | (40.9 | %) |
($ in thousands) | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Related party expenses | $ | 3,145 | $ | 901 | $ | 2,244 | 249.1 | % |
($ in thousands) | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Goodwill and intangible assets impairments | $ | 23,325 | $ | 1,547,711 | $ | (1,524,386) | n/m |
($ in thousands) | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Restructuring expenses | $ | 4,471 | $ | — | $ | 4,471 | n/m |
($ in thousands) | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
(Loss) gain from change in fair value of warrant liability | $ | (857) | $ | 13,139 | $ | (13,996) | n/m |
($ in thousands) | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Other income, net | $ | 33 | $ | 607 | $ | (574) | (94.6 | %) |
($ in thousands) | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | $ Change | % Change | |||||||||||||||||||
Income tax (expense) benefit | $ | (401) | $ | 8,238 | $ | (8,639) | n/m |
Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | ||||||||||
Net cash used in operating activities | $ | (53,891) | $ | (93,905) | |||||||
Net cash provided by (used in) investing activities | $ | 65,710 | $ | (136,578) | |||||||
Net cash (used in) provided by financing activities | $ | (2,502) | $ | 3 |
Payments Due by Period | |||||||||||||||||||||||||||||
Less than 1 year | 1-3 years | 3-5 years | More than 5 years | Total | |||||||||||||||||||||||||
Purchase obligations(1) | $ | 4,050 | $ | 19,100 | $ | — | $ | — | $ | 23,150 | |||||||||||||||||||
Future minimum operating lease payments(2) | 4,963 | 10,046 | 7,496 | 11,673 | 34,178 | ||||||||||||||||||||||||
Total contractual obligations | $ | 9,013 | $ | 29,146 | $ | 7,496 | $ | 11,673 | $ | 57,328 |
Three Months Ended September 30, 2023 | Three Months Ended September 30, 2022 | Nine Months Ended September 30, 2023 | Nine Months Ended September 30, 2022 | ||||||||||||||||||||
Net loss | $ | (51,749) | $ | (1,592,548) | $ | (147,119) | $ | (1,663,509) | |||||||||||||||
Depreciation and amortization | 3,959 | 6,391 | 10,843 | 18,340 | |||||||||||||||||||
Interest income, net | (1,177) | (623) | (3,502) | (838) | |||||||||||||||||||
Income tax expense (benefit) | 231 | (606) | 401 | (8,844) | |||||||||||||||||||
EBITDA | (48,736) | (1,587,386) | (139,377) | (1,654,851) | |||||||||||||||||||
Acquisition-related expenses | (739) | 454 | 17,053 | 1,148 | |||||||||||||||||||
Share-based and unit-based compensation expense | 3,297 | 8,776 | 15,584 | 29,185 | |||||||||||||||||||
Cancellation of common units | (13) | (110) | (13) | (185) | |||||||||||||||||||
Loss (gain) from change in fair value of warrant liability | 214 | (428) | 857 | (13,139) | |||||||||||||||||||
Goodwill and intangible assets impairments | 23,325 | 1,547,711 | 23,325 | 1,547,711 | |||||||||||||||||||
Impairment of long-lived assets | 56 | 15 | 56 | 15 | |||||||||||||||||||
Restructuring expenses | — | — | 4,471 | — | |||||||||||||||||||
Transition services expense | 1,033 | 267 | 3,145 | 901 | |||||||||||||||||||
Adjusted EBITDA loss | $ | (21,563) | $ | (30,701) | $ | (74,899) | $ | (89,215) |
Overview
We are a blank check company incorporated on July 31, 2020 as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities (the “Business Combination”). We have not selected any Business Combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any Business Combination target. We intend to effectuate our initial Business Combination using cash from the proceeds of our Initial Public Offering and the sale of the private placement warrants, our shares, debt or a combination of cash, equity and debt.
We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete a Business Combination will be successful.
Results of Operations
We have neither engaged in any operations (other than searching for a Business Combination after our Initial Public Offering) nor generated any revenues to date. Our only activities from inception to September 30, 2020 were organizational activities, those necessary to prepare for the Initial Public Offering, described below, and, after the Initial Public Offering, identifying a target company for a Business Combination. We do not expect to generate any operating revenues until after the completion of our Business Combination. We generate non-operating income in the form of interest income on marketable securities held in a trust account (the “Trust Account”). We incur expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses in connection with completing a Business Combination.
For the period from July 31, 2020 (inception) through September 30, 2020, we had a net loss of $17,379, which consisted of formation and operating expenses of $17,543, offset by interest earned on investments held in the Trust Account of $164.
Liquidity and Capital Resources
Until the consummation of the Initial Public Offering, our only source of liquidity was an initial purchase of ordinary shares by the Sponsor and loans from our Sponsor.
On September 25, 2020, we consummated the Initial Public Offering of 20,000,000 units (the ”Units”), at a price of $10.00 per Unit, generating gross proceeds of $200,000,000. Simultaneously with the closing of the Initial Public Offering, we consummated the sale of 6,000,000 warrants (the “Private Placement Warrants”) to the Sponsor at a price of $1.00 per Private Placement Warrant generating gross proceeds of $6,000,000.
Following the Initial Public Offering and the sale of the Private Placement Warrants, a total of $200,000,000 was placed in the Trust Account, and we had $1,205,178 of cash held outside of the Trust Account, after payment of costs related to the Initial Public Offering, and available for working capital purposes. We incurred $11,501,146 in transaction costs, including $4,000,000 of underwriting fees, $7,000,000 of deferred underwriting fees and $501,146 of other offering costs.
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On October 1, 2020, in connection with the underwriters’ election to partially exercise of their over-allotment option, we consummated the sale of an additional 737,202 Units and the sale of an additional 147,440 Private Placement Warrants, generating total gross proceeds of $7,519,460. A total of $7,372,020 of the net proceeds was deposited into the Trust Account, bringing the aggregate proceeds held in the Trust Account to $207,372,020.
For the period from July 31, 2020 (inception) through September 30, 2020, net cash used in operating activities was $289,300, which consisted of our net loss of $17,379, interest earned on investments of $164, formation expenses paid by the Sponsor of $6,606 and changes in operating assets and liabilities, which used $278,363 of cash from operating activities.
At September 30, 2020, we had investments held in the Trust Account of $200,000,164. We intend to use substantially all of the funds held in the Trust Account, including any amounts representing interest earned on the Trust Account, which interest shall be net of taxes payable and excluding deferred underwriting commissions, to complete our Business Combination. We may withdraw interest from the Trust Account to pay taxes, if any. To the extent that our share capital or debt is used, in whole or in part, as consideration to complete a Business Combination, the remaining proceeds held in the Trust Account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.
At September 30, 2020, we had cash of $1,230,178 held outside of the Trust Account. We intend to use the funds held outside the Trust Account primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, structure, negotiate and complete a Business Combination.
In order to fund working capital deficiencies or finance transaction costs in connection with a Business Combination, our Sponsor or an affiliate of our Sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. If we complete a Business Combination, we may repay such loaned amounts out of the proceeds of the Trust Account released to us. In the event that a Business Combination does not close, we may use a portion of the working capital held outside the Trust Account to repay such loaned amounts, but no proceeds from our Trust Account would be used for such repayment. Up to $1,500,000 of such loans may be convertible into warrants, at a price of $1.00 per warrant, at the option of the lender. The warrants would be identical to the Private Placement Warrants.
We do not believe we will need to raise additional funds in order to meet the expenditures required for operating our business. However, if our estimate of the costs of identifying a target business, undertaking in-depth due diligence and negotiating a 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. Moreover, we may need to obtain additional financing either to complete our Business Combination or because we become obligated to redeem a significant number of our public shares upon completion of our Business Combination, in which case we may issue additional securities or incur debt in connection with such Business Combination.
Off-Balance Sheet Financing Arrangements
We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of September 30, 2020. 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 the Sponsor a monthly fee of $10,000 for office space, utilities, secretarial and administrative support services, provided to the Company. We began incurring these fees on September 25, 2020 and will continue to incur these fees monthly until the earlier of the completion of a Business Combination and the Company’s liquidation.
The underwriters are entitled to a deferred fee of $0.35 per Unit, or $7,258,021 in the aggregate (see Note 9). The deferred fee will become payable to the underwriters 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.
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Critical Accounting Policies
The preparation of condensedconsolidated financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of AmericaU.S. GAAP requires management to make estimates and assumptions that affect the amounts reported amountsin our audited consolidated financial statements and accompanying notes. We base our estimates and assumptions on various judgments that we believe to be reasonable under the circumstances. The significant estimates and assumptions that affect the financial statements may include, but are not limited to, going concern, those that are related to income tax valuation allowances, useful lives of intangible assets and property, equipment and software, fair value of financial assets and liabilities, disclosuredetermining provision for doubtful accounts, valuation of contingentacquired tangible and intangible assets, the impairment of intangible assets and liabilities atgoodwill, and fair market value of Bakkt common units, incentive units and participation units. Actual results and outcomes may differ from management's estimates and assumptions and such differences may be material to our consolidated financial statements.
Class A Ordinary Shares Subject to Possible Redemption
We account for our Class A ordinary shares subject to possible redemption
Net Income (Loss) Per Ordinary Share
We apply the two-class method in calculating earnings per share. Net income per ordinary share, basic and diluted for Class A redeemable ordinary shares is calculated by dividing the interest income earned on the Trust Account by the weighted average number of Class A redeemable ordinary shares outstanding since original issuance. Net loss per common share, basic and diluted for Class B non-redeemable ordinary shares is calculated by dividing the net income (loss), less income attributable to Class A redeemable ordinary shares, by the weighted average number of Class B non-redeemable ordinary shares outstanding for the periods presented.
Recent Accounting Standards
Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on our condensed financial statements.
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We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act
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Evaluation of Disclosure Controls and Procedures
As required by Rules 13a-15 and 15d-15 under the Exchange Act, our Chief Executive Officer and Chief Financial Officer carried out an evaluationforms of the effectiveness of the design and operation of our disclosure controls and procedures as of September 30, 2020. Based upon their evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures (as defined in Rules 13a-15 (e) and 15d-15 (e) under the Exchange Act) were effective.
SEC.
During the most recently completed fiscal quarter, there has been
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None.
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Factors that could cause our actual results
VIH Business Combination, seeking damages as well as fees and costs. On March 14, 2023, the parties reached a settlement in principle. On April 12, 2023, the parties completed a stipulation of settlement resolving the litigation for $3.0 million, subject to Court approval. A motion for preliminary approval was filed with the Court on April 17, 2023. The securities in which we investmotion remains pending. We expect the funds heldsettlement will be covered by our insurance less our contractual retention. On June 23, 2023, an “opt-out” action related to the foregoing class action was filed against
The proceeds heldsubject to disputes regarding the quality of customer order execution, the settlement of customer orders or other matters relating to our services.
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On September 25, 2020, we consummated our Initial Public Offering of 20,000,000 Units. On October 1, 2020, in connection with underwriters’ election to partially exercise their option to purchase additional Units, we sold an additional 737,202 Units., at a price of $10.00 per Unit, generating total gross proceeds of $207,372,020. Jefferies LLC acted as the sole book-running manager. The securities sold in the offering were registered under the Securities Act on registration statements on Form S-1 (No. 333-248619). The registration statements became effective on September 22, 2020.
Simultaneously with the consummation of the Initial Public Offering, and the exercise of the over-allotment option in part and the sale of the Private Placement Warrants, we consummated a private placement of 6,147,440 Private Placement Warrants to our Sponsor at a priceaverage of $1.00 per Private Placement Warrant, generating total proceedsshare over a consecutive 30 trading-day period. While the NYSE rules generally provide for a six-month period to return to compliance following delivery of $6,147,440. Sucha noncompliance notice including by taking an action that will require approval of our shareholders, there can be no assurances that we will be able to achieve compliance with the minimum bid price requirements or any other listing requirements during such period, or at all.
The Private Placement Warrants are identical to the Public Warrants underlying the Units soldmarket quotations for our securities;
Of the gross proceeds received from the Initial Public Offering including the partial exercise of the option to purchase additional Units, and the sale of the Private Placement Warrants, $207,372,020 was placedtrading activity in the Trust Account.
We paidsecondary trading market for our securities;
For a descriptionIssuer Purchases of the use of the proceeds generated in our Initial Public Offering, see Part I, Item 2 of this Form 10-Q.
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Incorporated by Reference | ||||||||||||||||||||
Exhibit Number | Description | Form | File No. | Exhibit | Filing Date | |||||||||||||||
2.1 | 8-K | 001-39544 | 2.2 | April 3, 2023 | ||||||||||||||||
3.1 | 8-K | 001-39544 | 3.1 | October 21, 2021 | ||||||||||||||||
3.2 | 8-K | 001-39544 | 3.2 | October 21, 2021 | ||||||||||||||||
4.1 | 10-Q | 001-39544 | 4.2 | August 10, 2023 | ||||||||||||||||
31.1* | ||||||||||||||||||||
31.2* | ||||||||||||||||||||
32.1† | ||||||||||||||||||||
32.2† | ||||||||||||||||||||
101.INS* | Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document. | |||||||||||||||||||
101.SCH* | Inline XBRL Taxonomy Extension Schema Document | |||||||||||||||||||
101.CAL* | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |||||||||||||||||||
101.DEF* | Inline XBRL Taxonomy Extension Definition Linkbase Document | |||||||||||||||||||
101.LAB* | Inline XBRL Taxonomy Extension Label Linkbase Document | |||||||||||||||||||
101.PRE* | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |||||||||||||||||||
104* | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
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Date: November | 14, 2023 | By: | /s/ | ||||||||||||
Chief Executive Officer, President and Director (Principal Executive Officer) | |||||||||||||||
Date: November | 14, 2023 | By: | /s/ | ||||||||||||
Chief Financial Officer (Principal Financial | |||||||||||||||
Date: November 14, 2023 | By: | /s/ Chip Goodroe | |||||||||||||
Chip Goodroe | |||||||||||||||
Chief Accounting Officer (Principal Accounting Officer) |
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