| Florida (State or Other Jurisdiction of Incorporation or Organization) | | | 6211 (Primary Standard Industrial Classification Code Number) 8050 SW 10th Street Plantation, FL 33324 (954) 652-7000 | | | 65-0977576 (I.R.S. Employer Identification Number) | |
| Roxane F. Reardon Michael Wolfson Ravi Purushotham Simpson Thacher & Bartlett LLP 425 Lexington Avenue New York, New York 10017 Tel: +1 (212) 455-2000 | | | Carol Anne Huff Jason D. Osborn Winston & Strawn LLP 35 W. Wacker Drive Chicago, Illinois 60601 Tel: +1 (312) 558-5600 | |
| Large accelerated filer ☐ | | | Accelerated filer ☐ | |
| Non-accelerated filer ☒ | | | Smaller reporting company ☐ | |
| | | | Emerging growth company ☒ | |
| | As of December 31, 2021(1) | | | As of March 31, 2022(1) | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| | Assuming no redemptions | | Assuming 50% redemptions | | Assuming maximum redemptions | | | Assuming no redemptions | | Assuming 50% redemptions | | Assuming maximum redemptions | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| | Shares | | % | | Shares | | % | | Shares | | % | | | Shares | | % | | Shares | | % | | Shares | | % | | ||||||||||||||||||||||||||||||||||||||||||||||||
Public Stockholders(2) | | | | 20,875,000 | | | | | 10.4 | | | | | 10,812,500 | | | | | 5.6 | | | | | 0 | | | | | 0 | | | | | | 20,875,000 | | | | | 10.4 | | | | | 10,812,500 | | | | | 5.6 | | | | | 0 | | | | | 0 | | | ||||||||||||
Sponsor Shares (including the Sponsor Earn Out Shares) | | | | 3,570,696 | | | | | 1.7 | | | | | 3,570,696 | | | | | 1.8 | | | | | 3,570,696 | | | | | 1.9 | | | | | | 3,570,696 | | | | | 1.7 | | | | | 3,570,696 | | | | | 1.8 | | | | | 3,570,696 | | | | | 1.9 | | | ||||||||||||
Monex Shares (including Monex’s PIPE Shares and Monex Earn Out Shares) | | | | 168,748,232 | | | | | 83.8 | | | | | 168,748,232 | | | | | 88.3 | | | | | 168,748,232 | | | | | 93.5 | | | | | | 168,748,232 | | | | | 83.8 | | | | | 168,748,232 | | | | | 88.3 | | | | | 168,748,232 | | | | | 93.5 | | | ||||||||||||
PIPE Shares (excluding Monex’s PIPE Shares) | | | | 8,250,000 | | | | | 4.1 | | | | | 8,250,000 | | | | | 4.3 | | | | | 8,250,000 | | | | | 4.6 | | | | | | 8,250,000 | | | | | 4.1 | | | | | 8,250,000 | | | | | 4.3 | | | | | 8,250,000 | | | | | 4.6 | | | ||||||||||||
Total TradeStation Shares Outstanding at Closing (3) | | | | 201,443,928 | | | | | 100.0 | | | | | 191,381,428 | | | | | 100.0 | | | | | 180,568,928 | | | | | 100.0 | | | | | | 201,443,928 | | | | | 100.0 | | | | | 191,381,428 | | | | | 100.0 | | | | | 180,568,928 | | | | | 100.0 | | |
| | | | BY ORDER OF THE BOARD OF DIRECTORS | | | | |
| | | | John M. Schaible Chairman of the Board | | | |
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Cash & Stock Merger Consideration per Share | | | Assuming no redemptions | | | Assuming 50% redemptions | | | Assuming 90% redemptions | | |||||||||
Quantum Stockholders Who Choose Not to Redeem | | | | | | | | | | | | | | | | | | | |
Per share cash consideration | | | | | — | | | | | | — | | | | | | — | | |
Per share stock consideration | | | | | 1.0373 | | | | | | 1.0745 | | | | | | 1.3727 | | |
Quantum Stockholders Who Choose to Redeem | | | | | | | | | | | | | | | | | | | |
Per share cash consideration | | | | | — | | | | | $ | 10.00 | | | | | $ | 10.00 | | |
Per share stock consideration | | | | | — | | | | | | — | | | | | | — | | |
| | As of December 31, 2021(1) | | | As of March 31, 2022(1) | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| | Assuming no redemptions | | Assuming 50% redemptions | | Assuming 100% redemptions | | | Assuming no redemptions | | Assuming 50% redemptions | | Assuming 100% redemptions | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| | Shares | | % | | Shares | | % | | Shares | | % | | | Shares | | % | | Shares | | % | | Shares | | % | | ||||||||||||||||||||||||||||||||||||||||||||||||
Quantum stockholders (including the Sponsors) (2) | | | | 23,496,802 | | | | | 14.1 | | | | | 13,434,302 | | | | | 8.6 | | | | | 2,621,802 | | | | | 1.8 | | | | | | 23,496,802 | | | | | 14.1 | | | | | 13,434,302 | | | | | 8.6 | | | | | 2,621,802 | | | | | 1.8 | | | ||||||||||||
Monex Shares (excludes 5 million Monex PIPE Shares) (3) | | | | 129,750,000 | | | | | 77.9 | | | | | 129,750,000 | | | | | 82.9 | | | | | 129,750,000 | | | | | 89.1 | | | | | | 129,750,000 | | | | | 77.9 | | | | | 129,750,000 | | | | | 82.9 | | | | | 129,750,000 | | | | | 89.1 | | | ||||||||||||
PIPE Shares (includes 5 million Monex PIPE Shares) (4) | | | | 13,250,000 | | | | | 8.0 | | | | | 13,250,000 | | | | | 8.5 | | | | | 13,250,000 | | | | | 9.1 | | | | | | 13,250,000 | | | | | 8.0 | | | | | 13,250,000 | | | | | 8.5 | | | | | 13,250,000 | | | | | 9.1 | | | ||||||||||||
Total TradeStation Shares outstanding at the Closing (excluding Monex Earn Out Shares and Sponsor Earn Out Shares) (5) | | | | 166,496,802 | | | | | 100.0 | | | | | 156,434,302 | | | | | 100.0 | | | | | 145,621,802 | | | | | 100.0 | | | | | | 166,496,802 | | | | | 100.0 | | | | | 156,434,302 | | | | | 100.0 | | | | | 145,621,802 | | | | | 100.0 | | | ||||||||||||
Sponsor Earn Out Shares | | | | 948,894 | | | | | | | | | | 948,894 | | | | | | | | | | 948,894 | | | | | | | | | | | 948,894 | | | | | | | | | | 948,894 | | | | | | | | | | 948,894 | | | | | | | | ||||||||||||
Monex Earn Out Shares | | | | 33,998,232 | | | | | | | | | | 33,998,232 | | | | | | | | | | 33,998,232 | | | | | | | | | | | 33,998,232 | | | | | | | | | | 33,998,232 | | | | | | | | | | 33,998,232 | | | | | | | | ||||||||||||
Total TradeStation Shares outstanding at the Closing (including Monex Earn Out Shares and Sponsor Earn Out Shares) (6) | | | | 201,443,928 | | | | | | | | | | 191,381,428 | | | | | | | | | | 180,568,928 | | | | | | | | | | | 201,443,928 | | | | | | | | | | 191,381,428 | | | | | | | | | | 180,568,928 | | | | | | | |
| | | As of December 31, 2021(1) | | |||||||||||||||||||||||||||||||||
| | | Assuming no redemptions | | | Assuming 50% redemptions | | | Assuming 100% redemptions | | |||||||||||||||||||||||||||
| | | Shares | | | % | | | Shares | | | % | | | Shares | | | % | | ||||||||||||||||||
Quantum stockholders (including the Sponsors)(2) | | | | | 23,496,802 | | | | | | 14.1 | | | | | | 13,434,302 | | | | | | 8.6 | | | | | | 2,621,802 | | | | | | 1.8 | | |
Monex Shares (excludes 5 million Monex PIPE Shares)(3) | | | | | 129,750,000 | | | | | | 77.9 | | | | | | 129,750,000 | | | | | | 82.9 | | | | | | 129,750,000 | | | | | | 89.1 | | |
PIPE Shares (includes 5 million Monex PIPE Shares)(4) | | | | | 13,250,000 | | | | | | 8.0 | | | | | | 13,250,000 | | | | | | 8.5 | | | | | | 13,250,000 | | | | | | 9.10 | | |
Total TradeStation Shares outstanding at the Closing (excluding Monex Earn Out Shares and Sponsor Earn Out Shares)(5) | | | | | 166,496,802 | | | | | | 100.0 | | | | | | 156,434,302 | | | | | | 100.0 | | | | | | 145,621,802 | | | | | | 100.0 | | |
Sponsor Earn Out Shares | | | | | 948,894 | | | | | | | | | | | | 948,894 | | | | | | | | | | | | 948,894 | | | | | | | | |
Monex Earn Out Shares | | | | | 33,998,232 | | | | | | | | | | | | 33,998,232 | | | | | | | | | | | | 33,998,232 | | | | | | | | |
Total TradeStation Shares outstanding at the Closing (including Monex Earn Out Shares and Sponsor Earn Out Shares) | | | | | 201,443,928 | | | | | | | | | | | | 191,381,428 | | | | | | | | | | | | 180,568,928 | | | | | | | | |
| | | As of March 31, 2022(1) | | |||||||||||||||||||||||||||||||||
| | | Assuming no redemptions | | | Assuming 50% redemptions | | | Assuming 100% redemptions | | |||||||||||||||||||||||||||
| | | Shares | | | % | | | Shares | | | % | | | Shares | | | % | | ||||||||||||||||||
Quantum stockholders (including the Sponsors)(2) | | | | | 23,496,802 | | | | | | 14.1 | | | | | | 13,434,302 | | | | | | 8.6 | | | | | | 2,621,802 | | | | | | 1.8 | | |
Monex Shares (excludes 5 million Monex PIPE Shares)(3) | | | | | 129,750,000 | | | | | | 77.9 | | | | | | 129,750,000 | | | | | | 82.9 | | | | | | 129,750,000 | | | | | | 89.1 | | |
PIPE Shares (includes 5 million Monex PIPE Shares)(4) | | | | | 13,250,000 | | | | | | 8.0 | | | | | | 13,250,000 | | | | | | 8.5 | | | | | | 13,250,000 | | | | | | 9.10 | | |
Total TradeStation Shares outstanding at the Closing (excluding Monex Earn Out Shares and Sponsor Earn Out Shares)(5) | | | | | 166,496,802 | | | | | | 100.0 | | | | | | 156,434,302 | | | | | | 100.0 | | | | | | 145,621,802 | | | | | | 100.0 | | |
Sponsor Earn Out Shares | | | | | 948,894 | | | | | | | | | | | | 948,894 | | | | | | | | | | | | 948,894 | | | | | | | | |
Monex Earn Out Shares | | | | | 33,998,232 | | | | | | | | | | | | 33,998,232 | | | | | | | | | | | | 33,998,232 | | | | | | | | |
Total TradeStation Shares outstanding at the Closing (including Monex Earn Out Shares and Sponsor Earn Out Shares) | | | | | 201,443,928 | | | | | | | | | | | | 191,381,428 | | | | | | | | | | | | 180,568,928 | | | | | | | | |
| | Assuming No Redemptions | | Assuming 50% Redemptions | | Assuming 100% Redemptions | | | Assuming No Redemptions | | Assuming 50% Redemptions | | Assuming 100% Redemptions | | ||||||||||||||||||||||||
As of and for the nine months ended December 31, 2021 | | | | |||||||||||||||||||||||||||||||||||
As of and for the fiscal year ended March 31, 2022 | | | | |||||||||||||||||||||||||||||||||||
Book value (deficit) per share – basic and diluted(1) | | | $ | 1.16 | | | | $ | 0.59 | | | | $ | (0.05) | | | | | $ | 1.04 | | | | $ | 0.47 | | | | $ | (0.18) | | | ||||||
Weighted average shares outstanding – basic and diluted (2) | | | | 166,496,802 | | | | | 156,434,302 | | | | | 145,621,802 | | | | | | 166,496,802 | | | | | 156,434,302 | | | | | 145,621,802 | | | ||||||
Net income (loss) per share – basic and diluted | | | $ | (0.18) | | | | $ | (0.19) | | | | $ | (0.21) | | | | | $ | (0.35) | | | | $ | (0.38) | | | | $ | (0.40) | | | ||||||
Shareholders’ equity (deficit) (in thousands) | | | $ | 193,888 | | | | $ | 93,245 | | | | $ | (7,421) | | | | | $ | 174,546 | | | | $ | 73,903 | | | | $ | (26,719) | | |
| | | Quantum Units | | | Public Shares | | | Public Warrants | | |||||||||||||||||||||||||||
Calendar Quarter Ended 2021 | | | High | | | Low | | | High | | | Low | | | High | | | Low | | ||||||||||||||||||
First quarter (from March 10, 2021) | | | | $ | 10.32 | | | | | $ | 9.88 | | | | | $ | 9.85 | | | | | $ | 9.60 | | | | | $ | 0.47 | | | | | $ | 0.30 | | |
Second quarter | | | | $ | 10.15 | | | | | $ | 9.93 | | | | | $ | 9.90 | | | | | $ | 9.65 | | | | | $ | 0.37 | | | | | $ | 0.26 | | |
Third quarter | | | | $ | 10.20 | | | | | $ | 9.96 | | | | | $ | 9.85 | | | | | $ | 9.68 | | | | | $ | 0.40 | | | | | $ | 0.26 | | |
Fourth quarter | | | | $ | 10.65 | | | | | $ | 10.04 | | | | | $ | 10.22 | | | | | $ | 9.80 | | | | | $ | 0.73 | | | | | $ | 0.24 | | |
| | | Quantum Units | | | Public Shares | | | Public Warrants | | |||||||||||||||||||||||||||
Calendar Quarter | | | High | | | Low | | | High | | | Low | | | High | | | Low | | ||||||||||||||||||
First quarter 2021 (from March 10, 2021) | | | | $ | 10.32 | | | | | $ | 9.88 | | | | | $ | 9.85 | | | | | $ | 9.60 | | | | | $ | 0.47 | | | | | $ | 0.30 | | |
Second quarter 2021 | | | | $ | 10.15 | | | | | $ | 9.93 | | | | | $ | 9.90 | | | | | $ | 9.65 | | | | | $ | 0.37 | | | | | $ | 0.26 | | |
Third quarter 2021 | | | | $ | 10.20 | | | | | $ | 9.96 | | | | | $ | 9.85 | | | | | $ | 9.68 | | | | | $ | 0.40 | | | | | $ | 0.26 | | |
Fourth quarter 2021 | | | | $ | 10.65 | | | | | $ | 10.04 | | | | | $ | 10.22 | | | | | $ | 9.80 | | | | | $ | 0.73 | | | | | $ | 0.24 | | |
First quarter 2022 | | | | $ | 10.34 | | | | | $ | 10.09 | | | | | $ | 9.90 | | | | | $ | 9.85 | | | | | $ | 0.50 | | | | | $ | 0.26 | | |
Second quarter 2022 | | | | $ | 10.23 | | | | | $ | 9.86 | | | | | $ | 9.89 | | | | | $ | 9.83 | | | | | $ | 0.40 | | | | | $ | 0.07 | | |
($ in millions) | | | CY 2021E | | | CY 2022E | | | CY 2023E | | |||||||||
TradeStation Revenue | | | | $ | 219.6 | | | | | $ | 310.0 | | | | | $ | 470.5 | | |
TradeStation multiple | | | | | 6.5x | | | | | | 4.6x | | | | | | 3.1x | | |
75th percentile | | | | | 12.9x | | | | | | 9.9x | | | | | | 8.7x | | |
Mean | | | | | 11.2x | | | | | | 8.8x | | | | | | 7.0x | | |
Median | | | | | 10.6x | | | | | | 9.8x | | | | | | 7.5x | | |
25% | | | | | 8.3x | | | | | | 6.3x | | | | | | 5.2x | | |
| | | Fiscal Year Ended March 31, | | |||||||||||||||
| | | 2022E(3) | | | 2023E(3) | | | 2024E(3) | | |||||||||
| | | (in millions) | | |||||||||||||||
Revenue | | | | $ | 219 | | | | | $ | 349 | | | | | $ | 518 | | |
Total Expenses(1) | | | | $ | 246 | | | | | $ | 349 | | | | | $ | 453 | | |
Adjusted EBITDA(2) | | | | $ | (26) | | | | | $ | 0 | | | | | $ | 65 | | |
Adjusted Pre-Tax Income (Loss) | | | | $ | (48) | | | | | $ | (22) | | | | | $ | 40 | | |
| | | Calendar Year Ended December 31, | | ||||||||||||||||||||||||||||
| | | 2021 | | | | 2022E(3) | | | 2023E(3) | | | 2024E(3) | | | 2025E(3) | | |||||||||||||||
| | | (in millions) | | ||||||||||||||||||||||||||||
Revenue | | | | $ | 220 | | | | | | $ | 310 | | | | | $ | 471 | | | | | $ | 671 | | | | | $ | 923 | | |
Adjusted EBITDA(2) | | | | $ | 3 | | | | | | $ | (15) | | | | | $ | 44 | | | | | $ | 129 | | | | | $ | 235 | | |
| | | Fiscal Year Ended March 31, | | |||||||||||||||
| | | 2022E(3) | | | 2023E(3) | | | 2024E(3) | | |||||||||
| | | (in millions) | | |||||||||||||||
Revenue | | | | $ | 219 | | | | | $ | 349 | | | | | $ | 518 | | |
Total Expenses(1) | | | | $ | 246 | | | | | $ | 349 | | | | | $ | 453 | | |
Adjusted EBITDA(2) | | | | $ | (26) | | | | | $ | 0 | | | | | $ | 65 | | |
Adjusted Pre-Tax Income (Loss) | | | | $ | (48) | | | | | $ | (22) | | | | | $ | 40 | | |
| | | Calendar Year Ended December 31, | | ||||||||||||||||||||||||||||
| | | 2021 | | | | 2022E(3) | | | 2023E(3) | | | 2024E(3) | | | 2025E(3) | | |||||||||||||||
| | | (in millions) | | ||||||||||||||||||||||||||||
Revenue | | | | $ | 220 | | | | | | $ | 310 | | | | | $ | 471 | | | | | $ | 671 | | | | | $ | 923 | | |
Adjusted EBITDA(2) | | | | $ | 3 | | | | | | $ | (15) | | | | | $ | 44 | | | | | $ | 129 | | | | | $ | 235 | | |
| | | Fiscal Year Ended March 31, | | |||||||||||||||
| | | 2022E | | | 2023E | | | 2024E | | |||||||||
| | | (in millions) | | |||||||||||||||
Adjusted Pre-Tax Income (Loss) | | | | $ | (48) | | | | | $ | (22) | | | | | $ | 39 | | |
Depreciation and Amortization | | | | | 20 | | | | | | 22 | | | | | | 26 | | |
Interest Expense on Borrowings | | | | | 2 | | | | | | — | | | | | | — | | |
Adjusted EBITDA | | | | $ | (26) | | | | | $ | 0 | | | | | $ | 65 | | |
| | | Calendar Year Ended December 31, | | ||||||||||||||||
| | | 2021 | | | | 2022E | | | 2023E | | |||||||||
| | | (in millions) | | ||||||||||||||||
Adjusted Pre-Tax Income (Loss) | | | | $ | (19) | | | | | | $ | (36) | | | | | $ | 19 | | |
Depreciation and Amortization | | | | | 20 | | | | | | | 21 | | | | | | 25 | | |
Interest Expense on Borrowings | | | | | 2 | | | | | | | — | | | | | | — | | |
Adjusted EBITDA | | | | $ | 3 | | | | | | $ | (15) | | | | | $ | 44 | | |
| | | Number of Sponsor Shares Held Indirectly Through Sponsor | | |||||||||
Number of Sponsor | | | Shares Held Directly | | | Holdco(1) | | ||||||
John M. Schaible, Chairman and CEO | | | | | 40,833 | | | | | | 26,884 | | |
Miguel Leon, CFO and Director | | | | | 40,833 | | | | | | 57,611 | | |
Daniel Caamano V, President and Director | | | | | 40,833 | | | | | | 62,984 | | |
Sandip Patel, Director(2) | | | | | 40,833 | | | | | | 222,486 | | |
Thomas J. Hammond, Director | | | | | 40,833 | | | | | | 87,132 | | |
Richard Korhammer, Director | | | | | 40,833 | | | | | | 0 | | |
Steven J. Carlson, Director | | | | | 40,833 | | | | | | 57,607 | | |
| | | Number of Private Warrants Held Indirectly Through Sponsor Holdco(1) | | | Amount Paid for Private Warrants | | ||||||
John M. Schaible, Chairman and CEO | | | | | 35,000 | | | | | $ | 35,000 | | |
Miguel Leon, CFO and Director | | | | | 75,004 | | | | | $ | 75,004 | | |
Daniel Caamano V, President and Director | | | | | 82,000 | | | | | $ | 82,000 | | |
Sandip Patel, Director(2) | | | | | 288,758 | | | | | $ | 288,758 | | |
Thomas J. Hammond, Director | | | | | 113,438 | | | | | $ | 113,438 | | |
Richard Korhammer, Director | | | | | 0 | | | | | $ | 0 | | |
Steven J. Carlson, Director | | | | | 75,000 | | | | | $ | 75,000 | | |
| | | Amount of Working Capital Loans(1) | | |||
John M. Schaible, Chairman and CEO | | | | $ | 21,244 | | |
Miguel Leon, CFO and Director | | | | $ | 45,526 | | |
Daniel Caamano V, President and Director | | | | $ | 49,722 | | |
Sandip Patel, Director(2) | | | | $ | 196,401 | | |
Thomas J. Hammond, Director | | | | $ | 0 | | |
Richard Korhammer, Director | | | | $ | 0 | | |
Steven J. Carlson, Director | | | | $ | 0 | | |
Name | | | Age | | | Position | |
John Schaible | | | 51 | | | Chairman and Chief Executive Officer | |
Miguel Leon | | | 56 | | | Director and Chief Financial Officer | |
Daniel Caamano V | | | 65 | | | Director and President | |
Sandip I. Patel | | | 55 | | | Director | |
Thomas J. Hammond | | | 64 | | | Director | |
Richard Korhammer | | | 56 | | | Director | |
Steven J. Carlson | | | 62 | | | Director | |
| | | For the nine months ended December 31, | | | For the fiscal years ended March 31, | | ||||||||||||||||||||||||
Statement of Income | | | 2021 | | | 2020 | | | 2021 | | | 2020 | | | 2019 | | |||||||||||||||
(in thousands, except share data and per share amounts) | | | (unaudited) | | | (unaudited) | | | | | | | | | | | | | | | | | | | | ||||||
Revenues | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Trading-related revenue | | | | $ | 121,334 | | | | | $ | 118,299 | | | | | $ | 170,046 | | | | | $ | 113,231 | | | | | $ | 105,610 | | |
Subscription and other revenue | | | | | 4,402 | | | | | | 6,449 | | | | | | 8,771 | | | | | | 10,051 | | | | | | 12,647 | | |
Total non-interest income | | | | | 125,736 | | | | | | 124,748 | | | | | | 178,817 | | | | | | 123,282 | | | | | | 118,257 | | |
Interest income | | | | | 37,959 | | | | | | 31,209 | | | | | | 43,131 | | | | | | 68,131 | | | | | | 67,593 | | |
Interest expense | | | | | (6,688) | | | | | | (2,311) | | | | | | (3,296) | | | | | | (2,774) | | | | | | (1,719) | | |
Net interest income | | | | | 31,271 | | | | | | 28,898 | | | | | | 39,835 | | | | | | 65,357 | | | | | | 65,874 | | |
Total net revenues | | | | | 157,007 | | | | | | 153,646 | | | | | | 218,652 | | | | | | 188,639 | | | | | | 184,131 | | |
Expenses | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Employee compensation and benefits | | | | | 68,628 | | | | | | 53,050 | | | | | | 74,297 | | | | | | 69,066 | | | | | | 65,157 | | |
Cost of services provided | | | | | 25,186 | | | | | | 24,439 | | | | | | 33,493 | | | | | | 31,168 | | | | | | 28,253 | | |
Communication | | | | | 11,508 | | | | | | 10,497 | | | | | | 14,191 | | | | | | 12,488 | | | | | | 9,980 | | |
Marketing | | | | | 39,595 | | | | | | 11,949 | | | | | | 17,395 | | | | | | 11,049 | | | | | | 11,415 | | |
Professional services | | | | | 8,123 | | | | | | 4,729 | | | | | | 6,321 | | | | | | 4,679 | | | | | | 5,284 | | |
Occupancy and equipment | | | | | 12,329 | | | | | | 9,815 | | | | | | 13,439 | | | | | | 11,332 | | | | | | 10,146 | | |
Depreciation and amortization of property and equipment | | | | | 7,983 | | | | | | 7,476 | | | | | | 10,130 | | | | | | 9,947 | | | | | | 9,114 | | |
Amortization and intangibles | | | | | 6,693 | | | | | | 6,707 | | | | | | 8,942 | | | | | | 8,874 | | | | | | 8,778 | | |
Interest expense on borrowings | | | | | 2,293 | | | | | | 2,402 | | | | | | 3,070 | | | | | | 4,409 | | | | | | 4,590 | | |
Other expense (income) | | | | | (2,348) | | | | | | 16,365 | | | | | | 4,741 | | | | | | 13,186 | | | | | | 6,601 | | |
Total expenses | | | | | 179,990 | | | | | | 147,429 | | | | | | 186,019 | | | | | | 176,198 | | | | | | 159,318 | | |
Income (loss) before income taxes | | | | | (22,983) | | | | | | 6,217 | | | | | | 32,633 | | | | | | 12,441 | | | | | | 24,813 | | |
Income tax expense (benefit) | | | | | (6,037) | | | | | | 1,695 | | | | | | 8,843 | | | | | | 2,164 | | | | | | 6,217 | | |
Net income (loss) | | | | $ | (16,946) | | | | | $ | 4,522 | | | | | $ | 23,790 | | | | | $ | 10,277 | | | | | $ | 18,596 | | |
| | | For the nine months ended December 31, | | | For the fiscal years ended March 31, | | ||||||||||||||||||||||||
Statements of Cash Flows | | | 2021 | | | 2020 | | | 2021 | | | 2020 | | | 2019 | | |||||||||||||||
(in thousands) | | | (unaudited) | | | (unaudited) | | | | | | | | | | | | | | | | | | | | ||||||
Net cash provided by (used in) operating activities | | | | $ | 65,726 | | | | | $ | 534,736 | | | | | $ | 732,716 | | | | | $ | 474,390 | | | | | $ | 137,854 | | |
Net cash provided by (used in) investing activities | | | | | (13,876) | | | | | | (12,547) | | | | | | (12,888) | | | | | | (15,000) | | | | | | (10,732) | | |
Net cash provided by (used in) financing activities | | | | | 41,262 | | | | | | 21,000 | | | | | | 29,000 | | | | | | 45,000 | | | | | | (11,000) | | |
Net increase in cash, cash equivalents, and cash segregated | | | | $ | 93,112 | | | | | $ | 543,189 | | | | | $ | 748,828 | | | | | $ | 504,390 | | | | | $ | 116,122 | | |
| | | As of December 31, | | | As of March 31, | | ||||||||||||
Statement of Financial Condition | | | 2021 | | | 2021 | | | 2020 | | |||||||||
(in thousands) | | | (unaudited) | | | | | | | | | | | | | | |||
Cash and cash equivalents | | | | $ | 206,699 | | | | | $ | 84,399 | | | | | $ | 128,066 | | |
Total assets | | | | | 4,611,263 | | | | | | 4,197,497 | | | | | | 2,849,346 | | |
Total liabilities | | | | | 4,408,625 | | | | | | 3,954,175 | | | | | | 2,629,814 | | |
Total stockholder’s equity | | | | | 202,638 | | | | | | 243,322 | | | | | | 219,532 | | |
| | | For the nine months ended December 31, | | | For the fiscal years ended March 31, | | ||||||||||||||||||||||||
Other Financial Data: | | | 2021 | | | 2020 | | | 2021 | | | 2020 | | | 2019 | | |||||||||||||||
(in thousands) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Adjusted EBITDA(2) | | | | $ | (14,194) | | | | | $ | 35,261 | | | | | $ | 53,600 | | | | | $ | 41,884 | | | | | $ | 39,392 | | |
| | | Fiscal Year Ended March 31, | | |||||||||||||||
Statement of Income | | | 2022 | | | 2021 | | | 2021 | | |||||||||
(in thousands, except share data and per share amounts) | | | | | |||||||||||||||
Revenues | | | | | | | | | | | | | | | | | | | |
Trading-related revenue | | | | $ | 165,421 | | | | | $ | 170,046 | | | | | $ | 113,231 | | |
Subscription and other revenue | | | | | 2,854 | | | | | | 8,771 | | | | | | 10,051 | | |
Total non-interest income | | | | | 168,275 | | | | | | 178,817 | | | | | | 123,282 | | |
Interest income | | | | | 50,814 | | | | | | 43,131 | | | | | | 68,131 | | |
Interest expense | | | | | (9,470) | | | | | | (3,296) | | | | | | (2,774) | | |
Net interest income | | | | | 41,344 | | | | | | 39,835 | | | | | | 65,357 | | |
Total net revenues | | | | | 209,619 | | | | | | 218,652 | | | | | | 188,639 | | |
Expenses | | | | | | | | | | | | | | | | | | | |
Employee compensation and benefits | | | | | 91,664 | | | | | | 74,297 | | | | | | 69,066 | | |
Cost of services provided | | | | | 35,345 | | | | | | 33,493 | | | | | | 31,168 | | |
Communications | | | | | 15,543 | | | | | | 14,191 | | | | | | 12,488 | | |
Marketing | | | | | 57,733 | | | | | | 17,395 | | | | | | 11,049 | | |
Professional services | | | | | 10,091 | | | | | | 6,321 | | | | | | 4,679 | | |
Occupancy and equipment | | | | | 16,740 | | | | | | 13,439 | | | | | | 11,332 | | |
Depreciation and amortization of property and equipment | | | | | 10,758 | | | | | | 10,130 | | | | | | 9,947 | | |
Amortization and intangibles | | | | | 8,942 | | | | | | 8,942 | | | | | | 8,874 | | |
Interest expense on borrowings | | | | | 3,260 | | | | | | 3,070 | | | | | | 4,409 | | |
Other expense (income) | | | | | (1,355) | | | | | | 4,741 | | | | | | 13,186 | | |
Total expenses | | | | | 248,721 | | | | | | 186,019 | | | | | | 176,198 | | |
Income (loss) before income taxes | | | | | (39,102) | | | | | | 32,633 | | | | | | 12,441 | | |
Income tax expense (benefit) | | | | | (7,406) | | | | | | 8,843 | | | | | | 2,164 | | |
Net income (loss) | | | | $ | (31,696) | | | | | $ | 23,790 | | | | | $ | 10,277 | | |
| | | Year Ended March 31, | | |||||||||||||||
Statement of Financial Condition | | | 2022 | | | 2021 | | | 2020 | | |||||||||
(in thousands) | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 227,364 | | | | | $ | 84,399 | | | | | $ | 128,066 | | |
Total assets | | | | | 4,690,477 | | | | | | 4,197,497 | | | | | | 2,849,346 | | |
Total liabilities | | | | | 4,502,589 | | | | | | 3,954,175 | | | | | | 2,629,814 | | |
Total stockholder’s equity | | | | | 187,888 | | | | | | 243,322 | | | | | | 219,532 | | |
| | | Year Ended March 31, | | |||||||||||||||
Other Financial Data: | | | 2022 | | | 2021 | | | 2020 | | |||||||||
(in thousands) | | | | | | | | | | | | | | | | | | | |
Adjusted EBITDA(1) | | | | $ | (26,212) | | | | | $ | 53,600 | | | | | $ | 41,884 | | |
| | | For the nine months ended December 31, | | | For the fiscal years ended March 31, | | ||||||||||||||||||||||||
(in thousands) | | | 2021 | | | 2020 | | | 2021 | | | 2020 | | | 2019 | | |||||||||||||||
Net income (loss) | | | | $ | (16,946) | | | | | $ | 4,522 | | | | | $ | 23,790 | | | | | $ | 10,277 | | | | | $ | 18,596 | | |
Income tax provision (benefit) | | | | | (6,037) | | | | | | 1,695 | | | | | | 8,843 | | | | | | 2,164 | | | | | | 6,217 | | |
Depreciation & amortization | | | | | 14,676 | | | | | | 14,183 | | | | | | 19,072 | | | | | | 18,821 | | | | | | 17,892 | | |
Interest expense | | | | | 2,293 | | | | | | 2,402 | | | | | | 3,070 | | | | | | 4,409 | | | | | | 4,590 | | |
EBITDA | | | | | (6,014) | | | | | | 22,802 | | | | | | 54,775 | | | | | | 35,671 | | | | | | 47,295 | | |
Adjustments: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Swap fair value gain(a) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (7,067) | | |
Severance expense(b) | | | | | — | | | | | | 1,700 | | | | | | 1,700 | | | | | | — | | | | | | — | | |
Write-off of software(c) | | | | | — | | | | | | — | | | | | | — | | | | | | 1,996 | | | | | | 400 | | |
Market data audit settlement(d) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (1,236) | | |
Crypto timing gains & losses(e) | | | | | (34) | | | | | | 10,759 | | | | | | (2,875) | | | | | | 4,217 | | | | | | — | | |
Gain on investment(f) | | | | | (8,146) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Adjusted EBITDA | | | | $ | (14,194) | | | | | $ | 35,261 | | | | | $ | 53,600 | | | | | $ | 41,884 | | | | | $ | 39,392 | | |
| | | Year Ended March 31, | | |||||||||||||||
(in thousands) | | | 2022 | | | 2021 | | | 2020 | | |||||||||
Net income (loss) | | | | $ | (31,696) | | | | | $ | 23,790 | | | | | $ | 10,277 | | |
Income tax expense (benefit) | | | | | (7,406) | | | | | | 8,843 | | | | | | 2,164 | | |
Depreciation and amortization | | | | | 19,700 | | | | | | 19,072 | | | | | | 18,821 | | |
Interest expense | | | | | 3,260 | | | | | | 3,070 | | | | | | 4,409 | | |
EBITDA | | | | | (16,142) | | | | | | 54,775 | | | | | | 35,671 | | |
Adjustments: | | | | | | | | | | | | | | | | | | | |
Severance expense(a) | | | | | — | | | | | | 1,700 | | | | | | — | | |
Life insurance policy proceeds(b) | | | | | (1,841) | | | | | | — | | | | | | — | | |
Write-off of software(c) | | | | | — | | | | | | — | | | | | | 1,996 | | |
Crypto timing gains and losses(d) | | | | | (83) | | | | | | (2,875) | | | | | | 4,217 | | |
Gain on investment(e) | | | | | (8,146) | | | | | | — | | | | | | — | | |
Adjusted EBITDA | | | | $ | (26,212) | | | | | $ | 53,600 | | | | | $ | 41,884 | | |
| | As of December 31, | | As of March 31, | | | Fiscal Year Ended March 31, | | ||||||||||||||||||||||||||||||||||||||||||
| | 2021 | | 2020 | | 2021 | | 2020 | | 2019 | | | 2022 | | 2021 | | 2020 | | ||||||||||||||||||||||||||||||||
Total Customer Accounts | | | | 178,863 | | | | | 131,431 | | | | | 145,887 | | | | | 107,692 | | | | | 96,972 | | | | | | 181,036 | | | | | 145,887 | | | | | 107,692 | | |
| | Nine Months Ended December 31, | | Fiscal Year Ended March 31, | | | Fiscal Year Ended March 31, | | ||||||||||||||||||||||||||||||||||||||||||
| | 2021 | | 2020 | | 2021 | | 2020 | | 2019 | | | 2022 | | 2021 | | 2020 | | ||||||||||||||||||||||||||||||||
Gross New Accounts | | | | 66,528 | | | | | 51,828 | | | | | 79,089 | | | | | 35,543 | | | | | 33,333 | | | | | | 83,845 | | | | | 79,089 | | | | | 35,543 | | |
(in millions) | | | As of December 31, | | As of March 31, | | | | Fiscal Year Ended March 31, | | ||||||||||||||||||||||||||||||||||||||||
| 2021 | | 2020 | | 2021 | | 2020 | | 2019 | | | 2022 | | 2021 | | 2020 | | |||||||||||||||||||||||||||||||||
Equities and Futures Accounts | | | $ | 11,995 | | | | $ | 9,259 | | | | $ | 10,182 | | | | $ | 5,420 | | | | $ | 5,534 | | | ||||||||||||||||||||||||
Cryptocurrency Accounts(1) | | | | 283 | | | | | 54 | | | | | 154 | | | | | 2 | | | | | — | | | ||||||||||||||||||||||||
Equities | | | $ | 10,725 | | | | $ | 9,271 | | | | $ | 4,800 | | | ||||||||||||||||||||||||||||||||||
Options | | | | 80 | | | | | 93 | | | | | 33 | | | ||||||||||||||||||||||||||||||||||
Futures | | | | 877 | | | | | 818 | | | | | 587 | | | ||||||||||||||||||||||||||||||||||
Cryptocurrency(1) | | | | 344 | | | | | 154 | | | | | 2 | | | ||||||||||||||||||||||||||||||||||
Total Customer Assets | | | $ | 12,278 | | | | $ | 9,313 | | | | $ | 10,336 | | | | $ | 5,422 | | | | $ | 5,534 | | | | | $ | 12,026 | | | | $ | 10,336 | | | | $ | 5,422 | | |
(in millions) | | | As of December 31, | | As of March 31, | | | | Fiscal Year Ended March 31, | | ||||||||||||||||||||||||||||||||||||||||
| 2021 | | 2020 | | 2021 | | 2020 | | 2019 | | | 2022 | | 2021 | | 2020 | | |||||||||||||||||||||||||||||||||
Total Customer Cash | | | $ | 2,984 | | | | $ | 2,641 | | | | $ | 2,795 | | | | $ | 2,089 | | | | $ | 2,067 | | | | | $ | 2,908 | | | | $ | 2,795 | | | | $ | 2,089 | | |
| | Nine Months Ended December 31, | | Fiscal Year Ended March 31, | | | Fiscal Year Ended March 31, | | ||||||||||||||||||||||||||||||||||||||||||
| | 2021 | | 2020 | | 2021 | | 2020 | | 2019 | | | 2022 | | 2021 | | 2020 | | ||||||||||||||||||||||||||||||||
Equities and Futures Account DARTs | | | | 209,388 | | | | | 214,402 | | | | | 229,108 | | | | | 96,762 | | | | | 78,990 | | | | | | 216,081 | | | | | 229,108 | | | | | 96,762 | | | ||||||||
Crytpo Account DARTs | | | | 1,414 | | | | | 292 | | | | | 718 | | | | | 3 | | | | | — | | | | | | 1,324 | | | | | 718 | | | | | 3 | | | ||||||||
Total DARTs | | | | 210,802 | | | | | 214,694 | | | | | 229,826 | | | | | 96,765 | | | | | 78,990 | | | | | | 217,405 | | | | | 229,826 | | | | | 96,765 | | |
| | Nine Months Ended December 31, | | Fiscal Year Ended March 31, | | | Fiscal Year Ended March 31, | | ||||||||||||||||||||||||||||||||||||||||||
| | 2021 | | 2020 | | 2021 | | 2020 | | 2019 | | | 2022 | | 2021 | | 2020 | | ||||||||||||||||||||||||||||||||
Average Net Revenue Per Account | | | $ | 866 | | | | $ | 1,112 | | | | $ | 1,520 | | | | $ | 1,664 | | | | $ | 1,804 | | | | | $ | 1,092 | | | | $ | 1,520 | | | | $ | 1,664 | | |
| | Nine Months Ended December 31, | | Fiscal Year Ended March 31, | | | Fiscal Year Ended March 31, | | ||||||||||||||||||||||||||||||||||||||||||
(in millions) | | 2021 | | 2020 | | 2021 | | 2020 | | 2019 | | | 2022 | | 2021 | | 2020 | | ||||||||||||||||||||||||||||||||
Bitcoin | | | $ | 1,054 | | | | $ | 205 | | | | $ | 1,092 | | | | $ | 6 | | | | $ | — | | | | | $ | 1,308 | | | | $ | 1,092 | | | | $ | 6 | | | ||||||||
Ethereum | | | | 1,385 | | | | | 38 | | | | | 284 | | | | | 1 | | | | | — | | | | | | 1,668 | | | | | 284 | | | | | 1 | | | ||||||||
Other | | | | 195 | | | | | 31 | | | | | 104 | | | | | 2 | | | | | — | | | ||||||||||||||||||||||||
Litecoin | | | | 160 | | | | | 57 | | | | | 1 | | | ||||||||||||||||||||||||||||||||||
Bitcoin Cash | | | | 45 | | | | | 37 | | | | | 1 | | | ||||||||||||||||||||||||||||||||||
XRP | | | | 0 | | | | | 10 | | | | | 0 | | | ||||||||||||||||||||||||||||||||||
USDC | | | | 970 | | | | | 114 | | | | | — | | | ||||||||||||||||||||||||||||||||||
Total | | | $ | 2,634 | | | | $ | 274 | | | | $ | 1,480 | | | | $ | 9 | | | | $ | — | | | | | $ | 4,151 | | | | $ | 1,594 | | | | $ | 9 | | |
| | Nine Months Ended December 31, | | Fiscal Year Ended March 31, | | | Fiscal Year Ended March 31, | | ||||||||||||||||||||||||||||||||||||||||||
(in thousands) | | 2021 | | 2020 | | 2021 | | 2020 | | 2019 | | | 2022 | | 2021 | | 2020 | | ||||||||||||||||||||||||||||||||
Bitcoin | | | $ | 1,676 | | | | $ | 537 | | | | $ | 1,888 | | | | $ | 14 | | | | $ | — | | | | | $ | 2,086 | | | | $ | 1,888 | | | | $ | 14 | | | ||||||||
Ethereum | | | | 2,225 | | | | | 128 | | | | | 591 | | | | | 3 | | | | | — | | | ||||||||||||||||||||||||
Other | | | | 365 | | | | | 83 | | | | | 234 | | | | | 4 | | | | | — | | | ||||||||||||||||||||||||
Total | | | $ | 4,266 | | | | $ | 748 | | | | $ | 2,713 | | | | $ | 21 | | | | $ | — | | |
| | | Fiscal Year Ended March 31, | | |||||||||||||||
(in thousands) | | | 2022 | | | 2021 | | | 2020 | | |||||||||
Ethereum | | | | | 2,649 | | | | | | 591 | | | | | | 3 | | |
Litecoin | | | | | 290 | | | | | | 111 | | | | | | 2 | | |
Bitcoin Cash | | | | | 101 | | | | | | 75 | | | | | | 0 | | |
XRP | | | | | — | | | | | | 48 | | | | | | 1 | | |
USDC(1) | | | | | — | | | | | | — | | | | | | — | | |
Total | | | | $ | 5,126 | | | | | $ | 2,713 | | | | | $ | 20 | | |
|
| | Nine Months Ended December 31, | | Fiscal Year Ended March 31, | | | Fiscal Year Ended March 31, | | ||||||||||||||||||||||||||||||||||||||||||
| | 2021 | | 2020 | | 2021 | | 2020 | | 2019 | | | 2022 | | 2021 | | 2020 | | ||||||||||||||||||||||||||||||||
(in thousands) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||
Revenues: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||
Trading-related revenue | | | $ | 121,334 | | | | $ | 118,299 | | | | $ | 170,046 | | | | $ | 113,231 | | | | $ | 105,610 | | | | | $ | 165,421 | | | | $ | 170,046 | | | | $ | 113,231 | | | ||||||||
Subscription and other revenue | | | | 4,402 | | | | | 6,449 | | | | | 8,771 | | | | | 10,051 | | | | | 12,647 | | | | | | 2,854 | | | | | 8,771 | | | | | 10,051 | | | ||||||||
Total non-interest income | | | | 125,736 | | | | | 124,748 | | | | | 178,817 | | | | | 123,282 | | | | | 118,257 | | | | | | 168,275 | | | | | 178,817 | | | | | 123,282 | | | ||||||||
Interest income | | | | 37,959 | | | | | 31,209 | | | | | 43,131 | | | | | 68,131 | | | | | 67,593 | | | | | | 50,814 | | | | | 43,131 | | | | | 68,131 | | | ||||||||
Interest expense | | | | (6,688) | | | | | (2,311) | | | | | (3,296) | | | | | (2,774) | | | | | (1,719) | | | | | | (9,470) | | | | | (3,296) | | | | | (2,774) | | | ||||||||
Net interest income | | | | 31,271 | | | | | 28,898 | | | | | 39,835 | | | | | 65,357 | | | | | 65,874 | | | | | | 41,344 | | | | | 39,835 | | | | | 65,357 | | | ||||||||
Total net revenues | | | | 157,007 | | | | | 153,646 | | | | | 218,652 | | | | | 188,639 | | | | | 184,131 | | | | | | 209,619 | | | | | 218,652 | | | | | 188,639 | | | ||||||||
Expenses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||
Employee compensation and benefits | | | | 68,628 | | | | | 53,050 | | | | | 74,297 | | | | | 69,066 | | | | | 65,157 | | | | | | 91,664 | | | | | 74,297 | | | | | 69,066 | | | ||||||||
Cost of services provided | | | | 25,186 | | | | | 24,439 | | | | | 33,493 | | | | | 31,168 | | | | | 28,253 | | | | | | 35,345 | | | | | 33,493 | | | | | 31,168 | | | ||||||||
Communications | | | | 11,508 | | | | | 10,497 | | | | | 14,191 | | | | | 12,488 | | | | | 9,980 | | | | | | 15,543 | | | | | 14,191 | | | | | 12,488 | | | ||||||||
Marketing | | | | 39,595 | | | | | 11,949 | | | | | 17,395 | | | | | 11,049 | | | | | 11,415 | | | | | | 57,733 | | | | | 17,395 | | | | | 11,049 | | | ||||||||
Professional services | | | | 8,123 | | | | | 4,729 | | | | | 6,321 | | | | | 4,679 | | | | | 5,284 | | | | | | 10,091 | | | | | 6,321 | | | | | 4,679 | | | ||||||||
Occupancy and equipment | | | | 12,329 | | | | | 9,815 | | | | | 13,439 | | | | | 11,332 | | | | | 10,146 | | | | | | 16,740 | | | | | 13,439 | | | | | 11,332 | | | ||||||||
Depreciation and amortization of property and equipment | | | | 7,983 | | | | | 7,476 | | | | | 10,130 | | | | | 9,947 | | | | | 9,114 | | | | | | 10,758 | | | | | 10,130 | | | | | 9,947 | | | ||||||||
Amortization of intangibles | | | | 6,693 | | | | | 6,707 | | | | | 8,942 | | | | | 8,874 | | | | | 8,778 | | | | | | 8,942 | | | | | 8,942 | | | | | 8,874 | | | ||||||||
Interest expense on borrowings | | | | 2,293 | | | | | 2,402 | | | | | 3,070 | | | | | 4,409 | | | | | 4,590 | | | | | | 3,260 | | | | | 3,070 | | | | | 4,409 | | | ||||||||
Other expense (income) | | | | (2,348) | | | | | 16,365 | | | | | 4,741 | | | | | 13,186 | | | | | 6,601 | | | | | | (1,355) | | | | | 4,741 | | | | | 13,186 | | | ||||||||
Total expenses | | | | 179,990 | | | | | 147,429 | | | | | 186,019 | | | | | 176,198 | | | | | 159,318 | | | | | | 248,721 | | | | | 186,019 | | | | | 176,198 | | | ||||||||
Income (loss) before income taxes | | | | (22,983) | | | | | 6,217 | | | | | 32,633 | | | | | 12,441 | | | | | 24,813 | | | | | | (39,102) | | | | | 32,633 | | | | | 12,441 | | | ||||||||
Income tax expense (benefit) | | | | (6,037) | | | | | 1,695 | | | | | 8,843 | | | | | 2,164 | | | | | 6,217 | | | | | | (7,406) | | | | | 8,843 | | | | | 2,164 | | | ||||||||
Net income (loss) | | | $ | (16,946) | | | | $ | 4,522 | | | | $ | 23,790 | | | | $ | 10,277 | | | | $ | 18,596 | | | | | $ | (31,696) | | | | $ | 23,790 | | | | $ | 10,277 | | |
| | Nine Months Ended December 31, | | Change | | | Fiscal Year Ended March 31, | | Change | | ||||||||||||||||||||||||||||||||||||||||
| | 2021 | | 2020 | | $ | | % | | | 2022 | | 2021 | | $ | | % | | ||||||||||||||||||||||||||||||||
(in thousands) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||
Revenues: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||
Trading-related revenue | | | $ | 121,334 | | | | $ | 118,299 | | | | $ | 3,035 | | | | | 3% | | | | | $ | 165,421 | | | | $ | 170,046 | | | | $ | (4,625) | | | | | 3% | | | ||||||||
Subscription and other revenue | | | | 4,402 | | | | | 6,449 | | | | | (2,047) | | | | | (32)% | | | | | | 2,854 | | | | | 8,771 | | | | | (5,917) | | | | | (67)% | | | ||||||||
Total non-interest income | | | | 125,736 | | | | | 124,748 | | | | | 988 | | | | | 1% | | | | | | 168,275 | | | | | 178,817 | | | | | (10,542) | | | | | (6)% | | | ||||||||
Interest income | | | | 37,959 | | | | | 31,209 | | | | | 6,750 | | | | | 22% | | | | | | 50,814 | | | | | 43,131 | | | | | 7,683 | | | | | 18% | | | ||||||||
Interest expense | | | | (6,688) | | | | | (2,311) | | | | | (4,377) | | | | | 189% | | | | | | (9,470) | | | | | (3,296) | | | | | (6,174) | | | | | 187% | | | ||||||||
Net interest income | | | | 31,271 | | | | | 28,898 | | | | | 2,373 | | | | | 8% | | | | | | 41,344 | | | | | 39,835 | | | | | 1,509 | | | | | 4% | | | ||||||||
Total net revenues | | | | 157,007 | | | | | 153,646 | | | | | 3,361 | | | | | 2% | | | | | | 209,619 | | | | | 218,652 | | | | | (9,033) | | | | | (4)% | | | ||||||||
Expenses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||
Employee compensation and benefits | | | | 68,628 | | | | | 53,050 | | | | | 15,578 | | | | | 29% | | | | | | 91,664 | | | | | 74,297 | | | | | 17,367 | | | | | 23% | | | ||||||||
Cost of services provided | | | | 25,186 | | | | | 24,439 | | | | | 747 | | | | | 3% | | | | | | 35,345 | | | | | 33,493 | | | | | 1,852 | | | | | 6% | | | ||||||||
Communications | | | | 11,508 | | | | | 10,497 | | | | | 1,011 | | | | | 10% | | | | | | 15,543 | | | | | 14,191 | | | | | 1,352 | | | | | 10% | | | ||||||||
Marketing | | | | 39,595 | | | | | 11,949 | | | | | 27,646 | | | | | 231% | | | | | | 57,733 | | | | | 17,395 | | | | | 40,338 | | | | | 232% | | | ||||||||
Professional services | | | | 8,123 | | | | | 4,729 | | | | | 3,394 | | | | | 72% | | | | | | 10,091 | | | | | 6,321 | | | | | 3,770 | | | | | 60% | | | ||||||||
Occupancy and equipment | | | | 12,329 | | | | | 9,815 | | | | | 2,514 | | | | | 26% | | | | | | 16,740 | | | | | 13,439 | | | | | 3.301 | | | | | 25% | | | ||||||||
Depreciation and amortization of property and equipment | | | | 7,983 | | | | | 7,476 | | | | | 507 | | | | | 7% | | | | | | 10,758 | | | | | 10,130 | | | | | 628 | | | | | 6% | | | ||||||||
Amortization of intangibles | | | | 6,693 | | | | | 6,707 | | | | | (14) | | | | | 0% | | | | | | 8,942 | | | | | 8,942 | | | | | — | | | | | —% | | | ||||||||
Interest expense on borrowings | | | | 2,293 | | | | | 2,402 | | | | | (109) | | | | | (5)% | | | | | | 3,260 | | | | | 3,070 | | | | | 190 | | | | | 6% | | | ||||||||
Other expense (income) | | | | (2,348) | | | | | 16,365 | | | | | (18,713) | | | | | (114)% | | | | | | (1,355) | | | | | 4,741 | | | | | (6,096) | | | | | (129)% | | | ||||||||
Total expenses | | | | 179,990 | | | | | 147,429 | | | | | 32,561 | | | | | 22% | | | | | | 248,721 | | | | | 186,019 | | | | | 62,702 | | | | | 34% | | | ||||||||
Income (loss) before income taxes | | | | (22,983) | | | | | 6,217 | | | | | (29,200) | | | | | (470)% | | | | | | (39,102) | | | | | 32,633 | | | | | (71,735) | | | | | (220)% | | | ||||||||
Income tax expense (benefit) | | | | (6,037) | | | | | 1,695 | | | | | (7,732) | | | | | (456)% | | | | | | (7,406) | | | | | 8,843 | | | | | (16,249) | | | | | (184)% | | | ||||||||
Net income (loss) | | | $ | (16,946) | | | | $ | 4,522 | | | | $ | (21,468) | | | | | (475)% | | | | | $ | (31,696) | | | | $ | 23,790 | | | | $ | (55,486) | | | | | (233)% | | |
| | Nine Months Ended December 31, | | Change | | | Fiscal Year Ended March 31, | | Change | | ||||||||||||||||||||||||||||||||||||||||
| | 2021 | | 2020 | | $ | | % | | |||||||||||||||||||||||||||||||||||||||||
(in thousands) | | 2022 | | 2021 | | $ | | % | | |||||||||||||||||||||||||||||||||||||||||
Commissions | | | $ | 73,719 | | | | $ | 75,173 | | | | $ | (1,454) | | | | | (2)% | | | | | $ | 100,698 | | | | $ | 107,332 | | | | $ | (6,634) | | | | | (6)% | | | ||||||||
PFOF | | | | 40,070 | | | | | 34,430 | | | | | 5,640 | | | | | 16% | | | | | | 54,307 | | | | | 51,034 | | | | | 3,273 | | | | | 6% | | | ||||||||
Account and service fees | | | | 7,545 | | | | | 8,696 | | | | | (1,151) | | | | | (13)% | | | | | | 10,416 | | | | | 11,680 | | | | | (1,264) | | | | | (11)% | | | ||||||||
Total trading-related revenue | | | $ | 121,334 | | | | $ | 118,299 | | | | $ | 3,035 | | | | | 3% | | | | | $ | 165,421 | | | | $ | 170,046 | | | | $ | (4,625) | | | | | (3)% | | |
| | Nine Months Ended December 31, | | Change | | | Fiscal Year Ended March 31, | | Change | | ||||||||||||||||||||||||||||||||||||||||
(in thousands) | | 2021 | | 2020 | | $ | | % | | | 2022 | | 2021 | | $ | | % | | ||||||||||||||||||||||||||||||||
Securities lending | | | $ | 14,632 | | | | $ | 11,589 | | | | $ | 3,043 | | | | | 26% | | | | | $ | 19,102 | | | | $ | 15,549 | | | | $ | 3,553 | | | | | 23% | | | ||||||||
Margin lending | | | | 9,441 | | | | | 5,622 | | | | | 3,819 | | | | | 68% | | | | | | 12,234 | | | | | 8,609 | | | | | 3,625 | | | | | 42% | | | ||||||||
Interest on customer cash | | | | 7,088 | | | | | 11,048 | | | | | (3,960) | | | | | (36)% | | | | | | 9,820 | | | | | 14,315 | | | | | (4,495) | | | | | (31)% | | | ||||||||
Stablecoin and cryptocurrency lending | | | | 6,676 | | | | | 2,881 | | | | | 3,795 | | | | | 132% | | | | | | 9,393 | | | | | 4,567 | | | | | 4,826 | | | | | 106% | | | ||||||||
Other interest income | | | | 122 | | | | | 69 | | | | | 53 | | | | | 77% | | | | | | 265 | | | | | 91 | | | | | 174 | | | | | 191% | | | ||||||||
Total interest income | | | | 37,959 | | | | | 31,209 | | | | | 6,750 | | | | | 22% | | | | | | 50,814 | | | | | 43,131 | | | | | 7,683 | | | | | 18% | | | ||||||||
Interest expense | | | | (6,688) | | | | | (2,311) | | | | | (4,377) | | | | | 189% | | | | | | (9,470) | | | | | (3,296) | | | | | (6,174) | | | | | 187% | | | ||||||||
Net interest income | | | $ | 31,271 | | | | $ | 28,898 | | | | $ | 2,373 | | | | | 8% | | | | | $ | 41,344 | | | | $ | 39,835 | | | | $ | 1,509 | | | | | 4% | | |
| | Nine Months Ended December 31, | | Change | | | Fiscal Year Ended March 31, | | Change | | ||||||||||||||||||||||||||||||||||||||||
(in thousands) | | 2021 | | 2020 | | $ | | % | | | 2022 | | 2021 | | $ | | % | | ||||||||||||||||||||||||||||||||
Stablecoin and cryptocurrency interest | | | $ | 3,990 | | | | $ | 98 | | | | $ | 3,892 | | | | | 3,971% | | | | | $ | 6,080 | | | | $ | 325 | | | | $ | 5,755 | | | | | 1,771% | | | ||||||||
Fully paid lending shared interest | | | | 2,576 | | | | | 2,051 | | | | | 525 | | | | | 26% | | | |||||||||||||||||||||||||||||
Fully paid lending | | | | 3,247 | | | | | 2,682 | | | | | 565 | | | | | 21% | | | |||||||||||||||||||||||||||||
Other interest expense | | | | 122 | | | | | 162 | | | | | (40) | | | | | (25)% | | | | | | 143 | | | | | 289 | | | | | (146) | | | | | (51)% | | | ||||||||
Total interest expense | | | $ | 6,688 | | | | $ | 2,311 | | | | $ | 4,377 | | | | | 189% | | | | | $ | 9,470 | | | | $ | 3,296 | | | | $ | 6,174 | | | | | 187% | | |
| | Nine Months Ended December 31, | | Change | | | Fiscal Year Ended 31, | | Change | | ||||||||||||||||||||||||||||||||||||||||
(in thousands) | | 2021 | | 2020 | | $ | | % | | | 2022 | | 2021 | | $ | | % | | ||||||||||||||||||||||||||||||||
Clearing and execution fees | | | $ | 20,932 | | | | $ | 21,622 | | | | $ | (690) | | | | | (3)% | | | | | $ | 29,604 | | | | $ | 29,188 | | | | $ | 416 | | | | | 1% | | | ||||||||
Service fees | | | | 4,254 | | | | | 2,817 | | | | | 1,437 | | | | | 51% | | | | | | 5,741 | | | | | 4,305 | | | | | 1,436 | | | | | 33% | | | ||||||||
Total cost of services provided | | | $ | 25,186 | | | | $ | 24,439 | | | | $ | 747 | | | | | 3% | | | | | $ | 35,345 | | | | $ | 33,493 | | | | $ | 1,852 | | | | | 6% | | |
| | Nine Months Ended December 31, | | Change | | | Fiscal Year Ended March 31, | | Change | | ||||||||||||||||||||||||||||||||||||||||
(in thousands) | | 2021 | | 2020 | | $ | | % | | | 2022 | | 2021 | | $ | | % | | ||||||||||||||||||||||||||||||||
Gain on investment | | | $ | (8,146) | | | | $ | — | | | | $ | (8,146) | | | | | —% | | | |||||||||||||||||||||||||||||
Impairment loss on cryptocurrency assets | | | | — | | | | | 25,334 | | | | | (25,334) | | | | | (100)% | | | |||||||||||||||||||||||||||||
Net gain on cryptocurrency assets | | | $ | (34) | | | | $ | (12,090) | | | | $ | 12,056 | | | | | (100)% | | | | | | (83) | | | | | (28,209) | | | | | 28,126 | | | | | (100)% | | | ||||||||
Impairment loss on cryptocurrency assets | | | | — | | | | | 22,504 | | | | | (22,504) | | | | | (100)% | | | |||||||||||||||||||||||||||||
Gain on investment | | | | (8,146) | | | | | — | | | | | (8,146) | | | | | (100)% | | | |||||||||||||||||||||||||||||
Regulatory fees and expenses | | | | 1,001 | | | | | 900 | | | | | 101 | | | | | 11% | | | | | | 1,820 | | | | | 1,197 | | | | | 623 | | | | | 52% | | | ||||||||
Other miscellaneous expenses | | | | 4,831 | | | | | 5,051 | | | | | (220) | | | | | (4)% | | | | | | 5,054 | | | | | 6,419 | | | | | (1,365) | | | | | (21)% | | | ||||||||
Other expenses (income) | | | $ | (2,348) | | | | $ | 16,365 | | | | $ | (18,713) | | | | | (114)% | | | | | $ | (1,355) | | | | $ | 4,741 | | | | $ | (6,096) | | | | | (129)% | | |
| | Fiscal Year Ended March 31, | | Change | | | Fiscal Year Ended March 31, | | Change | | ||||||||||||||||||||||||||||||||||||||||
| | 2021 | | 2020 | | $ | | % | | | 2021 | | 2020 | | $ | | % | | ||||||||||||||||||||||||||||||||
(In thousands) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||
Revenues: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||
Trading-related revenue | | | $ | 170,046 | | | | $ | 113,231 | | | | $ | 56,815 | | | | | 50% | | | | | $ | 170,046 | | | | $ | 113,231 | | | | $ | 56,815 | | | | | 50% | | | ||||||||
Subscription and other revenue | | | | 8,771 | | | | | 10,051 | | | | | (1,280) | | | | | (13)% | | | | | | 8,771 | | | | | 10,051 | | | | | (1,280) | | | | | (13)% | | | ||||||||
Total non-interest income | | | | 178,817 | | | | | 123,282 | | | | | 55,535 | | | | | 45% | | | | | | 178,817 | | | | | 123,282 | | | | | 55,535 | | | | | 45% | | | ||||||||
Interest income | | | | 43,131 | | | | | 68,131 | | | | | (25,000) | | | | | (37)% | | | | | | 43,131 | | | | | 68,131 | | | | | (25,000) | | | | | (37)% | | | ||||||||
Interest expense | | | | (3,296) | | | | | (2,774) | | | | | (522) | | | | | 19% | | | | | | (3,296) | | | | | (2,774) | | | | | (522) | | | | | 19% | | | ||||||||
Net interest income | | | | 39,835 | | | | | 65,357 | | | | | (25,522) | | | | | (39)% | | | | | | 39,835 | | | | | 65,357 | | | | | (25,522) | | | | | (39)% | | | ||||||||
Total net revenues | | | | 218,652 | | | | | 188,639 | | | | | 30,013 | | | | | 16% | | | | | | 218,652 | | | | | 188,639 | | | | | 30,013 | | | | | 16% | | | ||||||||
Expenses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||
Employee compensation and benefits | | | | 74,297 | | | | | 69,066 | | | | | 5,231 | | | | | 8% | | | | | | 74,297 | | | | | 69,066 | | | | | 5,231 | | | | | 8% | | | ||||||||
Cost of services provided | | | | 33,493 | | | | | 31,168 | | | | | 2,325 | | | | | 7% | | | | | | 33,493 | | | | | 31,168 | | | | | 2,325 | | | | | 7% | | | ||||||||
Communications | | | | 14,191 | | | | | 12,488 | | | | | 1,703 | | | | | 14% | | | |||||||||||||||||||||||||||||
Marketing | | | | 17,395 | | | | | 11,049 | | | | | 6,346 | | | | | 57% | | | |||||||||||||||||||||||||||||
Professional services | | | | 6,321 | | | | | 4,679 | | | | | 1,642 | | | | | 35% | | | |||||||||||||||||||||||||||||
Occupancy and equipment | | | | 13,439 | | | | | 11,332 | | | | | 2,107 | | | | | 19% | | | |||||||||||||||||||||||||||||
Depreciation and amortization of property and equipment | | | | 10,130 | | | | | 9,947 | | | | | 183 | | | | | 2% | | | |||||||||||||||||||||||||||||
Communications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | | | | 14,191 | | | | | 12,488 | | | | | 1,703 | | | | | 14% | | | |||||||||||||||||||||||||||||
Marketing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | | | | 17,395 | | | | | 11,049 | | | | | 6,346 | | | | | 57% | | | |||||||||||||||||||||||||||||
Professional services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | | | | 6,321 | | | | | 4,679 | | | | | 1,642 | | | | | 35% | | | |||||||||||||||||||||||||||||
Occupancy and equipment . . . . . . . . . . . . . . . . . . . . . . . . | | | | 13,439 | | | | | 11,332 | | | | | 2,107 | | | | | 19% | | | |||||||||||||||||||||||||||||
Depreciation and amortization of property and equipment . . | | | | 10,130 | | | | | 9,947 | | | | | 183 | | | | | 2% | | | |||||||||||||||||||||||||||||
Amortization of intangibles . . . . . . . . . . . . . . . . . . . . . . . . | | | | 8,942 | | | | | 8,874 | | | | | 68 | | | | | 1% | | | |||||||||||||||||||||||||||||
Interest expense on borrowings . . . . . . . . . . . . . . . . . . . . . | | | | 3,070 | | | | | 4,409 | | | | | (1,339) | | | | | (30)% | | | |||||||||||||||||||||||||||||
Other expense (income) . . . . . . . . . . . . . . . . . . . . . . . . . . . | | | | 4,741 | | | | | 13,186 | | | | | (8,445) | | | | | (64)% | | | |||||||||||||||||||||||||||||
Total expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | | | | 186,019 | | | | | 176,198 | | | | | 9,821 | | | | | 6% | | | |||||||||||||||||||||||||||||
Income (loss) before income taxes . . . . . . . . . . . . . . . . . . . . . | | | | 32,633 | | | | | 12,441 | | | | | 20,192 | | | | | 162% | | | |||||||||||||||||||||||||||||
Income tax expense (benefit) . . . . . . . . . . . . . . . . . . . . . . . . . | | | | 8,843 | | | | | 2,164 | | | | | 6,679 | | | | | 309% | | | |||||||||||||||||||||||||||||
Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | | | $ | 23,790 | | | | $ | 10,277 | | | | $ | 13,513 | | | | | 131% | | |
| | | Fiscal Year Ended March 31, | | | Change | | ||||||||||||||||||
| | | 2021 | | | 2020 | | | $ | | | % | | ||||||||||||
(In thousands) | | | | | | | | | | | | | | | | | | | | | | | | | |
Amortization of intangibles | | | | | 8,942 | | | | | | 8,874 | | | | | | 68 | | | | | | 1% | | |
Interest expense on borrowings | | | | | 3,070 | | | | | | 4,409 | | | | | | (1,339) | | | | | | (30)% | | |
Other expense (income) | | | | | 4,741 | | | | | | 13,186 | | | | | | (8,445) | | | | | | (64)% | | |
Total expenses | | | | | 186,019 | | | | | | 176,198 | | | | | | 9,821 | | | | | | 6% | | |
Income (loss) before income taxes | | | | | 32,633 | | | | | | 12,441 | | | | | | 20,192 | | | | | | 162% | | |
Income tax expense (benefit) | | | | | 8,843 | | | | | | 2,164 | | | | | | 6,679 | | | | | | 309% | | |
Net income (loss) | | | | $ | 23,790 | | | | | $ | 10,277 | | | | | $ | 13,513 | | | | | | 131% | | |
|
| | | Fiscal Year Ended March 31, | | | Change | | ||||||||||||||||||
| | | 2021 | | | 2020 | | | $ | | | % | | ||||||||||||
Commissions | | | | $ | 107,331 | | | | | $ | 81,642 | | | | | $ | 25,689 | | | | | | 31% | | |
PFOF | | | | | 51,034 | | | | | | 17,821 | | | | | | 33,213 | | | | | | 186% | | |
Account and service fees | | | | | 11,681 | | | | | | 13,768 | | | | | | (2,087) | | | | | | (15)% | | |
Total trading-related revenue | | | | $ | 170,046 | | | | | $ | 113,231 | | | | | $ | 56,815 | | | | | | 50% | | |
| | | Fiscal Year Ended March 31, | | | Change | | ||||||||||||||||||
| | | 2021 | | | 2020 | | | $ | | | % | | ||||||||||||
Commissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | | | | $ | 107,331 | | | | | $ | 81,642 | | | | | $ | 25,689 | | | | | | 31% | | |
PFOF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | | | | | 51,034 | | | | | | 17,821 | | | | | | 33,213 | | | | | | 186% | | |
Account and service fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . | | | | | 11,681 | | | | | | 13,768 | | | | | | (2,087) | | | | | | (15)% | | |
Total trading-related revenue . . . . . . . . . . . . . . . . . . . . . . . . | | | | $ | 170,046 | | | | | $ | 113,231 | | | | | $ | 56,815 | | | | | | 50% | | |
| | Fiscal Year Ended March 31, | | Change | | | Fiscal Year Ended March 31, | | Change | | ||||||||||||||||||||||||||||||||||||||||
| | 2021 | | 2020 | | $ | | % | | | 2021 | | 2020 | | $ | | % | | ||||||||||||||||||||||||||||||||
Securities lending | | | $ | 15,549 | | | | $ | 11,656 | | | | $ | 3,893 | | | | | 33% | | | | | $ | 15,549 | | | | $ | 11,656 | | | | $ | 3,893 | | | | | 33% | | | ||||||||
Margin lending | | | | 8,609 | | | | | 5,549 | | | | | 3,060 | | | | | 55% | | | | | | 8,609 | | | | | 5,549 | | | | | 3,060 | | | | | 55% | | | ||||||||
Interest on customer cash | | | | 14,315 | | | | | 50,634 | | | | | (36,319) | | | | | (72)% | | | | | | 14,315 | | | | | 50,634 | | | | | (36,319) | | | | | (72)% | | | ||||||||
Stablecoin and cryptocurrency lending | | | | 4,567 | | | | | 273 | | | | | 4,295 | | | | | 1,575% | | | | | | 4,567 | | | | | 273 | | | | | 4,294 | | | | | 1,573% | | | ||||||||
Other interest income | | | | 90 | | | | | 19 | | | | | 71 | | | | | 371% | | | | | | 91 | | | | | 19 | | | | | 72 | | | | | 379% | | | ||||||||
Total interest income | | | | 43,131 | | | | | 68,131 | | | | | (25,000) | | | | | (37)% | | | | | | 43,131 | | | | | 68,131 | | | | | (25,000) | | | | | (37)% | | | ||||||||
Interest expense | | | | (3,296) | | | | | (2,774) | | | | | (522) | | | | | 19% | | | | | | (3,296) | | | | | (2,774) | | | | | (522) | | | | | 19% | | | ||||||||
Net interest income | | | $ | 39,835 | | | | $ | 65,357 | | | | $ | (25,522) | | | | | (39)% | | | | | $ | 39,835 | | | | $ | 65,357 | | | | $ | (25,522) | | | | | (39)% | | |
| | | Fiscal Year Ended March 31, | | | Change | | ||||||||||||||||||
(in thousands) | | | 2021 | | | 2020 | | | $ | | | % | | ||||||||||||
Stablecoin and cryptocurrency interest | | | | $ | 325 | | | | | $ | — | | | | | $ | 325 | | | | | | — | | |
Fully paid lending | | | | | 2,682 | | | | | | 1,365 | | | | | | 1,317 | | | | | | 96% | | |
Other interest expense | | | | | 289 | | | | | | 1,409 | | | | | | (1,120) | | | | | | (79)% | | |
Total interest expense | | | | $ | 3,296 | | | | | $ | 2,774 | | | | | $ | 522 | | | | | | 19% | | |
| | | Fiscal Year Ended March 31, | | | Change | | ||||||||||||||||||
(in thousands) | | | 2021 | | | 2020 | | | $ | | | % | | ||||||||||||
Clearing and execution fees | | | | $ | 29,188 | | | | | $ | 28,949 | | | | | $ | 239 | | | | | | 1% | | |
Service fees | | | | | 4,305 | | | | | | 2,219 | | | | | | 2,086 | | | | | | 94% | | |
Cost of Service Provided | | | | $ | 33,493 | | | | | $ | 31,168 | | | | | $ | 2,325 | | | | | | 7% | | |
| | | Fiscal Year Ended March 31, | | | Change | | ||||||||||||||||||
(in thousands) | | | 2021 | | | 2020 | | | $ | | | % | | ||||||||||||
Net gain on cryptocurrency assets | | | | $ | (28,209) | | | | | $ | (9,397) | | | | | $ | (18,812) | | | | | | 200% | | |
Impairment loss on cryptocurrency assets | | | | | 25,334 | | | | | | 13,614 | | | | | | 11,720 | | | | | | 86% | | |
Regulatory fees and expenses | | | | | 1,197 | | | | | | 743 | | | | | | 454 | | | | | | 61% | | |
Other miscellaneous expenses | | | | | 6,419 | | | | | | 8,226 | | | | | | (1,807) | | | | | | (22)% | | |
Other expense (income) | | | | $ | 4,741 | | | | | $ | 13,186 | | | | | $ | (8,445) | | | | | | (64)% | | |
| | | Fiscal Year Ended March 31, | | | Change | | ||||||||||||||||||
| | | 2020 | | | 2019 | | | $ | | | % | | ||||||||||||
(in thousands) | | | | | | | | | | | | | | | | | | | | | | | | | |
Revenues: | | | | | | | | | | | | | | | | | | | | | | | | | |
Trading-related revenue | | | | $ | 113,231 | | | | | $ | 105,610 | | | | | $ | 7,621 | | | | | | 7% | | |
Subscription and other revenue | | | | | 10,051 | | | | | | 12,647 | | | | | | (2,596) | | | | | | (21)% | | |
Total non-interest income | | | | | 123,282 | | | | | | 118,257 | | | | | | 5,025 | | | | | | 4% | | |
Interest income | | | | | 68,131 | | | | | | 67,593 | | | | | | 538 | | | | | | 1% | | |
Interest expense | | | | | (2,774) | | | | | | (1,719) | | | | | | (1,055) | | | | | | 61% | | |
Net interest income | | | | | 65,357 | | | | | | 65,874 | | | | | | (517) | | | | | | (1)% | | |
Net revenues | | | | | 188,639 | | | | | | 184,131 | | | | | | 4,508 | | | | | | 2% | | |
Expenses: | | | | | | | | | | | | | | | | | | | | | | | | | |
Employee compensation and benefits | | | | | 69,066 | | | | | | 65,157 | | | | | | 3,909 | | | | | | 6% | | |
Cost of services provided | | | | | 31,168 | | | | | | 28,253 | | | | | | 2,915 | | | | | | 10% | | |
Communications | | | | | 12,488 | | | | | | 9,980 | | | | | | 2,508 | | | | | | 25% | | |
Marketing | | | | | 11,049 | | | | | | 11,415 | | | | | | (366) | | | | | | (3)% | | |
Professional services | | | | | 4,679 | | | | | | 5,284 | | | | | | (605) | | | | | | (11)% | | |
Occupancy and equipment | | | | | 11,332 | | | | | | 10,146 | | | | | | 1,186 | | | | | | 12% | | |
Depreciation and amortization of property and equipment | | | | | 9,947 | | | | | | 9,114 | | | | | | 833 | | | | | | 9% | | |
Amortization of intangibles | | | | | 8,874 | | | | | | 8,778 | | | | | | 96 | | | | | | 1% | | |
Interest expense on borrowings | | | | | 4,409 | | | | | | 4,590 | | | | | | (181) | | | | | | (4)% | | |
Other expense (income) | | | | | 13,186 | | | | | | 6,601 | | | | | | 6,585 | | | | | | 100% | | |
Total expenses | | | | | 176,198 | | | | | | 159,318 | | | | | | 16,880 | | | | | | 11% | | |
Income (loss) before income taxes | | | | | 12,441 | | | | | | 24,813 | | | | | | (12,372) | | | | | | (50)% | | |
Income tax expense (benefit) | | | | | 2,164 | | | | | | 6,217 | | | | | | (4,053) | | | | | | (65)% | | |
Net income (loss) | | | | $ | 10,277 | | | | | $ | 18,596 | | | | | $ | (8,319) | | | | | | (45)% | | |
| | | Fiscal Year Ended March 31, | | | Change | | ||||||||||||||||||
(in thousands) | | | 2020 | | | 2019 | | | $ | | | % | | ||||||||||||
Commissions | | | | $ | 81,642 | | | | | $ | 77,831 | | | | | $ | 3,811 | | | | | | 5% | | |
PFOF | | | | | 17,821 | | | | | | 14,580 | | | | | | 3,241 | | | | | | 22% | | |
Account and service fees | | | | | 13,768 | | | | | | 13,199 | | | | | | 569 | | | | | | 4% | | |
Total trading-related revenue | | | | $ | 113,231 | | | | | $ | 105,610 | | | | | $ | 7,621 | | | | | | 7% | | |
| | | Fiscal Year Ended March 31, | | | Change | | ||||||||||||||||||
| | | 2020 | | | 2019 | | | $ | | | % | | ||||||||||||
Securities lending | | | | $ | 11,656 | | | | | $ | 8,449 | | | | | $ | 3,207 | | | | | | 38% | | |
Margin lending | | | | | 5,549 | | | | | | 5,726 | | | | | | (177) | | | | | | (3)% | | |
Interest on customer cash | | | | | 50,634 | | | | | | 52,987 | | | | | | (2,353) | | | | | | (4)% | | |
Stablecoin and cryptocurrency lending | | | | | 273 | | | | | | — | | | | | | 273 | | | | | | — | | |
Other interest income | | | | | 19 | | | | | | 431 | | | | | | 412 | | | | | | (96)% | | |
Total interest income | | | | | 68,131 | | | | | | 67,593 | | | | | | 538 | | | | | | 1% | | |
Interest expense | | | | | (2,774) | | | | | | (1,719) | | | | | | (1,055) | | | | | | 61% | | |
Net interest income | | | | $ | 65,357 | | | | | $ | 65,874 | | | | | $ | (517) | | | | | | (1)% | | |
| | | Fiscal Year Ended March 31, | | | Change | | ||||||||||||||||||
(in thousands) | | | 2020 | | | 2019 | | | $ | | | % | | ||||||||||||
Clearing and execution fees | | | | $ | 28,949 | | | | | $ | 26,442 | | | | | $ | 2,507 | | | | | | 9% | | |
Service fees | | | | | 2,219 | | | | | | 1,811 | | | | | | 408 | | | | | | 23% | | |
Cost of Service Provided | | | | $ | 31,168 | | | | | $ | 28,253 | | | | | $ | 2,915 | | | | | | 10% | | |
| | | Fiscal Year Ended March 31, | | | Change | | ||||||||||||||||||
(in thousands) | | | 2020 | | | 2019 | | | $ | | | % | | ||||||||||||
Net gain on cryptocurrency assets | | | | $ | (9,397) | | | | | $ | — | | | | | $ | (9,397) | | | | | | — | | |
Impairment loss on cryptocurrency assets | | | | | 13,614 | | | | | | — | | | | | | 13,614 | | | | | | — | | |
Regulatory fees and expenses | | | | | 743 | | | | | | 974 | | | | | | (231) | | | | | | (24)% | | |
Other miscellaneous expenses | | | | | 8,226 | | | | | | 5,627 | | | | | | 2,599 | | | | | | 46% | | |
Other expenses (income) | | | | $ | 13,186 | | | | | $ | 6,601 | | | | | $ | 6,585 | | | | | | 100% | | |
| | Nine Months Ended December 31, | | Year Ended March 31, | | | Year Ended March 31, | | ||||||||||||||||||||||||||||||||||||||||||
(in thousands) | | 2021 | | 2020 | | 2021 | | 2020 | | 2019 | | | 2022 | | 2021 | | 2020 | | ||||||||||||||||||||||||||||||||
Net cash provided by (used in) operating activities | | | $ | 65,726 | | | | $ | 534,736 | | | | $ | 732,716 | | | | $ | 474,390 | | | | $ | 137,854 | | | | | $ | 38,656 | | | | $ | 732,716 | | | | $ | 474,390 | | | ||||||||
Net cash provided by (used in) investing activities | | | | (13,876) | | | | | (12,547) | | | | | (12,888) | | | | | (15,000) | | | | | (10,732) | | | | | | (20,486) | | | | | (12,888) | | | | | (15,000) | | | ||||||||
Net cash provided by (used in) financing activities | | | | 41,262 | | | | | 21,000 | | | | | 29,000 | | | | | 45,000 | | | | | (11,000) | | | | | | 51,262 | | | | | 29,000 | | | | | 45,000 | | | ||||||||
Net increase in cash, cash equivalents, and cash segregated | | | $ | 93,112 | | | | $ | 543,189 | | | | $ | 748,828 | | | | $ | 504,390 | | | | $ | 116,122 | | | | | $ | 69,432 | | | | $ | 748,828 | | | | $ | 504,390 | | |
| | December 31, | | March 31, | | March 31, | | | March 31, | | March 31, | | March 31, | | ||||||||||||||||||||||||
| | 2021 | | 2021 | | 2020 | | | 2022 | | 2021 | | 2020 | | ||||||||||||||||||||||||
Net Capital | | | $ | 151,540 | | | | $ | 147,925 | | | | $ | 133,656 | | | | | $ | 143,789 | | | | $ | 147,925 | | | | $ | 133,656 | | | ||||||
Required Adjusted Net Capital | | | | 14,680 | | | | | 11,397 | | | | | 4,599 | | | | | | 11,137 | | | | | 11,397 | | | | | 4,599 | | | ||||||
Excess Adjusted Net Capital | | | | 136,860 | | | | | 136,528 | | | | | 129,057 | | | | | | 132,652 | | | | | 136,528 | | | | | 129,057 | | |
| | As of December 31, 2021 | | As of March 31, 2021(1) | | | As of March 31, 2022 | | As of March 31, 2021(1) | | ||||||||||||||||||||||||||||||||||||||||
Category | | Book Value | | Fair Value | | Book Value | | Fair Value | | | Book Value | | Fair Value | | Book Value | | Fair Value | | ||||||||||||||||||||||||||||||||
Bitcoin | | | $ | 107 | | | | $ | 383 | | | | $ | 115 | | | | $ | 926 | | | | | $ | 120 | | | | $ | 166 | | | | $ | 116 | | | | $ | 926 | | | ||||||||
Ethereum | | | | 115 | | | | | 123 | | | | | 239 | | | | | 269 | | | | | | 31 | | | | | 40 | | | | | 238 | | | | | 269 | | | ||||||||
Other | | | | 69 | | | | | 198 | | | | | 52 | | | | | 204 | | | |||||||||||||||||||||||||||||
Litecoin | | | | 32 | | | | | 63 | | | | | 17 | | | | | 89 | | | |||||||||||||||||||||||||||||
Bitcoin Cash | | | | 18 | | | | | 42 | | | | | 19 | | | | | 60 | | | |||||||||||||||||||||||||||||
XRP | | | | 16 | | | | | 77 | | | | | 16 | | | | | 55 | | | |||||||||||||||||||||||||||||
Firm Asset | | | | 291 | | | | | 704 | | | | | 406 | | | | | 1,399 | | | | | | 217 | | | | | 388 | | | | | 406 | | | | | 1,399 | | | ||||||||
Bitcoin | | | | 190,731 | | | | | 190,731 | | | | | 186,057 | | | | | 186,057 | | | | | | 142,867 | | | | | 142,867 | | | | | 186,057 | | | | | 186,057 | | | ||||||||
Ethereum | | | | 145 | | | | | 145 | | | | | 3,329 | | | | | 3,329 | | | | | | 74,389 | | | | | 74,389 | | | | | 3,329 | | | | | 3,329 | | | ||||||||
Collateral Asset | | | | 190,876 | | | | | 190,876 | | | | | 189,386 | | | | | 189,386 | | | | | | 217,256 | | | | | 217,256 | | | | | 189,386 | | | | | 189,386 | | | ||||||||
Bitcoin | | | | 59,940 | | | | | 59,940 | | | | | 103,431 | | | | | 103,431 | | | | | | 61,563 | | | | | 61,563 | | | | | 103,431 | | | | | 103,431 | | | ||||||||
Ethereum | | | | 67,533 | | | | | 67,533 | | | | | 22,710 | | | | | 22,710 | | | | | | 86,131 | | | | | 86,131 | | | | | 22,710 | | | | | 22,710 | | | ||||||||
Other | | | | 4,184 | | | | | 5,465 | | | | | 3,475 | | | | | 4,761 | | | |||||||||||||||||||||||||||||
Customer Asset | | | | 131,657 | | | | | 132,938 | | | | | 129,616 | | | | | 130,902 | | | |||||||||||||||||||||||||||||
Litecoin | | | | 5,287 | | | | | 5,287 | | | | | 1,841 | | | | | 1,841 | | | |||||||||||||||||||||||||||||
Bitcoin Cash | | | | 654 | | | | | 654 | | | | | 781 | | | | | 781 | | | |||||||||||||||||||||||||||||
XRP(2) | | | | 923 | | | | | 2,166 | | | | | 853 | | | | | 2,139 | | | |||||||||||||||||||||||||||||
Customer Asset(3) | | | | 154,558 | | | | | 155,801 | | | | | 129,616 | | | | | 130,902 | | | |||||||||||||||||||||||||||||
Total | | | $ | 322,824 | | | | $ | 324,518 | | | | $ | 319,408 | | | | $ | 321,687 | | | | | $ | 372,031 | | | | $ | 373,445 | | | | $ | 319,408 | | | | $ | 321,687 | | |
| | As of December 31, 2021 | | As of March 31, 2021 | | | As of March 31, 2022 | | As of March 31, 2021 | | ||||||||||||||||||||||||||||||||||||||||
Category | | Book Value | | Fair Value | | Book Value | | Fair Value | | | Book Value | | Fair Value | | Book Value | | Fair Value | | ||||||||||||||||||||||||||||||||
Bitcoin | | | $ | 29,215 | | | | $ | 29,215 | | | | $ | — | | | | $ | — | | | | | $ | 24,285 | | | | $ | 24,285 | | | | $ | — | | | | $ | — | | | ||||||||
Ethereum | | | | 14,739 | | | | | 14,739 | | | | | 7,765 | | | | | 7,765 | | | | | | 2,639 | | | | | 2,639 | | | | | 7,765 | | | | | 7,765 | | | ||||||||
Other | | | | 292 | | | | | 292 | | | | | 391 | | | | | 391 | | | |||||||||||||||||||||||||||||
Litecoin | | | | — | | | | | — | | | | | 391 | | | | | 391 | | | |||||||||||||||||||||||||||||
Total | | | $ | 44,246 | | | | $ | 44,246 | | | | $ | 8,156 | | | | $ | 8,156 | | | | | $ | 26,924 | | | | $ | 26,924 | | | | $ | 8,156 | | | | $ | 8,156 | | |
Name and Principal Position | | | Fiscal Year | | | Salary ($)(1) | | | Bonus ($)(2) | | | Non-Equity Incentive Plan Compensation ($)(3) | | | All Other Compensation ($)(4) | | | Total ($) | | ||||||||||||||||||
John Bartleman Chief Executive Officer | | | | | 2022 | | | | | | 472,917 | | | | | | — | | | | | | 1,261,763 | | | | | | 7,260 | | | | | | 1,741,940 | | |
| | | | | 2021 | | | | | | 450,000 | | | | | | — | | | | | | 1,023,889 | | | | | | 6,840 | | | | | | 1,480,729 | | |
Greg Vance Chief Financial Officer | | | | | 2022 | | | | | | 362,083 | | | | | | — | | | | | | 524,181 | | | | | | 7,380 | | | | | | 893,644 | | |
| | | | | 2021 | | | | | | 329,167 | | | | | | 50,000 | | | | | | 337,781 | | | | | | 6,900 | | | | | | 723,848 | | |
Marc Stone Chief Legal Officer | | | | | 2022 | | | | | | 368,583 | | | | | | — | | | | | | 480,277 | | | | | | 7,308 | | | | | | 856,168 | | |
| | | | | 2021 | | | | | | 342,000 | | | | | | — | | | | | | 263,519 | | | | | | 2,052 | | | | | | 607,571 | | |
| | | Minimum | | | Target | | | Maximum | | ||||||
Revenue | | | $186.3 million | | | $219.2 million | | | $274.0 million | | ||||||
EBITDA | | | $(32.3) million | | | $(15.9) million | | | $17.0 million | | ||||||
Payout as a % of Target Amount | | | 0% | | | | | 100% | | | | | | 200% | | |
| Pretax Income (Loss) | | | $(17.1) million | | | $(9.8) million | | | $30.1 million | | |||||||||
| Payout as a % of Target | | | | | 0% | | | | | | 100% | | | | | | 239% | | |
Name | | | Base Salary ($) | | | Target Bonus as a % of Base Salary | | | Target Bonus Amount ($) | | | Achievement Factor | | | Bonus Earned in fiscal 2021 ($) | | | Deferred Bonus ($) | | ||||||||||||||||||
John Bartleman | | | | | 450,000 | | | | | | 180% | | | | | | 810,000 | | | | | | 225% | | | | | | 455,625 | | | | | | 1,366,875 | | |
Greg Vance | | | | | 330,000 | | | | | | 85% | | | | | | 280,500 | | | | | | 225% | | | | | | 157,781 | | | | | | 473,344 | | |
Marc Stone | | | | | 342,000 | | | | | | 85% | | | | | | 290,700 | | | | | | 225% | | | | | | 163,519 | | | | | | 490,556 | | |
Name | | | 2018 LTI Grant ($) | | | Earned Amount ($) | | ||||||
John Bartleman | | | | | 1,030,000 | | | | | | 515,000 | | |
Greg Vance | | | | | 360,000 | | | | | | 180,000 | | |
Marc Stone | | | | | 200,000 | | | | | | 100,000 | | |
Grant | | | Target Amount | | | Grant Date Fair Market Value | | | Vesting Date Fair Market Value | | | Multiplier | | | Earned Amount | | |||||||||||||||
2014 Cash Program | | | | $ | 37,500 | | | | | ¥ | 345.43 | | | | | ¥ | 879.13 | | | | | | 2.5450 | | | | | $ | 95,438 | | |
Grant | | | Target Amount | | | Grant Date Fair Market Value | | | Vesting Date Fair Market Value | | | Multiplier | | | Earned Amount | | |||||||||||||||
2014 Cash Program Grant | | | | $ | 50,000 | | | | | ¥ | 357.06 | | | | | ¥ | 214.26 | | | | | | 0.6001 | | | | | $ | 30,004 | | |
2015 Cash Program Grant | | | | $ | 37,500 | | | | | ¥ | 345.43 | | | | | ¥ | 214.26 | | | | | | 0.6203 | | | | | $ | 23,260 | | |
| | No Redemption Scenario | | 50% Redemption Scenario(1) | | Maximum Redemption Scenario(2) | | | No Redemption Scenario | | 50% Redemption Scenario(1) | | Maximum Redemption Scenario(2) | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| | Purchase Price | | Shares Issued | | Purchase Price | | Shares Issued | | Purchase Price | | Shares Issued | | | Purchase Price | | Shares Issued | | Purchase Price | | Shares Issued | | Purchase Price | | Shares Issued | | ||||||||||||||||||||||||||||||||||||||||||||||||
| | (in thousands, except share and per share amounts) | | | (in thousands, except share and per share amounts) | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share consideration to Public Stockholders at Closing (3) | | | $ | 201,250 | | | | | 20,875,000 | | | | $ | 100,625 | | | | | 10,812,500 | | | | $ | — | | | | | — | | | | | $ | 201,250 | | | | | 20,875,000 | | | | $ | 100,625 | | | | | 10,812,500 | | | | $ | — | | | | | — | | | ||||||||||||
Share consideration to Quantum Sponsors at Closing (4) | | | $ | 26,218 | | | | | 2,621,802 | | | | $ | 26,218 | | | | | 2,621,802 | | | | $ | 26,218 | | | | | 2,621,802 | | | | | $ | 26,218 | | | | | 2,621,802 | | | | $ | 26,218 | | | | | 2,621,802 | | | | $ | 26,218 | | | | | 2,621,802 | | | ||||||||||||
Quantum PIPE Investment(5) | | | $ | 75,000 | | | | | 8,250,000 | | | | $ | 75,000 | | | | | 8,250,000 | | | | $ | 75,000 | | | | | 8,250,000 | | | |||||||||||||||||||||||||||||||||||||||||||
Quantum PIPE Investment(5) | | | $ | 75,000 | | | | | 8,250,000 | | | | $ | 75,000 | | | | | 8,250,000 | | | | $ | 75,000 | | | | | 8,250,000 | | |
| | | Assuming No Redemptions | | | Assuming 50% Redemptions | | | Assuming Maximum Redemptions | | |||||||||||||||||||||||||||
Equity Capitalization Summary at Closing | | | Shares | | | % | | | Shares | | | % | | | Shares | | | % | | ||||||||||||||||||
Public Stockholders(1) | | | | | 20,875,000 | | | | | | 12% | | | | | | 10,812,500 | | | | | | 7% | | | | | | — | | | | | | — | | |
Quantum Sponsor Shares(2) | | | | | 2,621,802 | | | | | | 2% | | | | | | 2,621,802 | | | | | | 2% | | | | | | 2,621,802 | | | | | | 2% | | |
TradeStation Stockholder (Monex)(3)(4) | | | | | 129,750,000 | | | | | | 77% | | | | | | 129,750,000 | | | | | | 82% | | | | | | 129,750,000 | | | | | | 88% | | |
Quantum PIPE Shares(5) | | | | | 8,250,000 | | | | | | 5% | | | | | | 8,250,000 | | | | | | 5% | | | | | | 8,250,000 | | | | | | 6% | | |
Monex PIPE Shares | | | | | 5,000,000 | | | | | | 3% | | | | | | 5,000,000 | | | | | | 3% | | | | | | 5,000,000 | | | | | | 3% | | |
Executive Shares(6) | | | | | 965,490 | | | | | | 1% | | | | | | 965,490 | | | | | | 1% | | | | | | 965,490 | | | | | | 1% | | |
Total Shares Outstanding at Closing excluding shares below | | | | | 167,462,292 | | | | | | 100% | | | | | | 157,399,792 | | | | | | 100% | | | | | | 146,587,292 | | | | | | 100% | | |
| | | Assuming No Redemptions | | | Assuming 50% Redemptions | | | Assuming Maximum Redemptions | | |||||||||||||||||||||||||||
Equity Capitalization Summary at Closing | | | Shares | | | % | | | Shares | | | % | | | Shares | | | % | | ||||||||||||||||||
Potential sources of dilution | | | | | | | | ||||||||||||||||||||||||||||||
Monex Earn Out Shares | | | | | 33,998,232 | | | | | | 15% | | | | | | 33,998,232 | | | | | | 16% | | | | | | 33,998,232 | | | | | | 17% | | |
Sponsor Earn Out Shares | | | | | 948,894 | | | | | | * | | | | | | 948,894 | | | | | | * | | | | | | 948,894 | | | | | | * | | |
Public Warrants(7) | | | | | 10,437,831 | | | | | | 5% | | | | | | 10,812,156 | | | | | | 5% | | | | | | 10,062,500 | | | | | | 5% | | |
Private Placement Warrants(7) | | | | | 6,153,125 | | | | | | 3% | | | | | | 6,153,125 | | | | | | 3% | | | | | | 6,153,125 | | | | | | 3% | | |
PIPE Additional Shares(8) | | | | | 4,038,462 | | | | | | 2% | | | | | | 4,038,462 | | | | | | 2% | | | | | | 4,038,462 | | | | | | 2% | | |
Total Potentially Dilutive Shares | | | | | 55,576,544 | | | | | | 25% | | | | | | 55,950,869 | | | | | | 26% | | | | | | 55,201,213 | | | | | | 27% | | |
Total Shares Outstanding at Closing including potentially dilutive shares above | | | | | 223,038,836 | | | | | | | | | | | | 213,350,661 | | | | | | | | | | | | 201,788,505 | | | | | | | | |
|
| | Historical | | Assuming No Redemptions | | Assuming Maximum Redemptions | | | Historical | | Assuming No Redemptions | | Assuming Maximum Redemptions | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| | Quantum Acquisition Corporation | | TradeStation Group Inc. | | Pro Forma Accounting Adjustments (Note 3) | | | | Pro Forma Condensed Combined | | Additional Pro Forma Adjustments (Note 3) | | | | Pro Forma Condensed Combined | | | Quantum Acquisition Corporation | | TradeStation Group Inc. | | Pro Forma Accounting Adjustments (Note 3) | | | | Pro Forma Condensed Combined | | Additional Pro Forma Adjustments (Note 3) | | | | Pro Forma Condensed Combined | | ||||||||||||||||||||||||||||||||||||||||||||||||||||
ASSETS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||||||||
Cash and cash equivalents | | | $ | 63 | | | | $ | 206,699 | | | | $ | 282,201 | | | A | | | $ | 488,963 | | | | $ | (201,309) | | | B | | | $ | 287,654 | | | | | $ | 124 | | | | $ | 227,364 | | | | $ | 283,528 | | | A | | | $ | 511,016 | | | | $ | (201,265) | | | B | | | $ | 309,751 | | | ||||||||||||||||
Cash and investments segregated under federal regulations and other | | | | — | | | | | 2,819,543 | | | | | — | | | | | | | 2,819,543 | | | | | — | | | | | | | 2,819,543 | | | | | | — | | | | | 2,773,092 | | | | | — | | | | | | | 2,773,092 | | | | | — | | | | | | | 2,773,092 | | | ||||||||||||||||
Receivables from brokers, dealers, clearing organizations and clearing agents | | | | — | | | | | 72,369 | | | | | — | | | | | | | 72,369 | | | | | — | | | | | | | 72,369 | | | | | | — | | | | | 71,585 | | | | | — | | | | | | | 71,585 | | | | | — | | | | | | | 71,585 | | | ||||||||||||||||
Securities borrowed | | | | — | | | | | 572,840 | | | | | — | | | | | | | 572,840 | | | | | — | | | | | | | 572,840 | | | | | | — | | | | | 670,936 | | | | | — | | | | | | | 670,936 | | | | | — | | | | | | | 670,936 | | | ||||||||||||||||
Receivables from brokerage customers, net of allowance | | | | — | | | | | 179,792 | | | | | — | | | | | | | 179,792 | | | | | — | | | | | | | 179,792 | | | | | | — | | | | | 152,577 | | | | | — | | | | | | | 152,577 | | | | | — | | | | | | | 152,577 | | | ||||||||||||||||
Cryptocurrency assets | | | | — | | | | | 322,824 | | | | | — | | | | | | | 322,824 | | | | | — | | | | | | | 322,824 | | | | | | — | | | | | 372,031 | | | | | — | | | | | | | 372,031 | | | | | — | | | | | | | 372,031 | | | ||||||||||||||||
Stablecoin assets | | | | — | | | | | 1,245 | | | | | — | | | | | | | 1,245 | | | | | — | | | | | | | 1,245 | | | | | | — | | | | | 1,288 | | | | | — | | | | | | | 1,288 | | | | | — | | | | | | | 1,288 | | | ||||||||||||||||
Cryptocurrency assets loaned | | | | — | | | | | 44,246 | | | | | — | | | | | | | 44,246 | | | | | — | | | | | | | 44,246 | | | | | | — | | | | | 26,924 | | | | | — | | | | | | | 26,924 | | | | | — | | | | | | | 26,924 | | | ||||||||||||||||
Pledged stablecoin assets | | | | — | | | | | 137,450 | | | | | — | | | | | | | 137,450 | | | | | — | | | | | | | 137,450 | | | | | | — | | | | | 135,850 | | | | | — | | | | | | | 135,850 | | | | | — | | | | | | | 135,850 | | | ||||||||||||||||
Due from affiliated companies | | | | — | | | | | 551 | | | | | — | | | | | | | 551 | | | | | — | | | | | | | 551 | | | | | | — | | | | | 1,269 | | | | | — | | | | | | | 1,269 | | | | | — | | | | | | | 1,269 | | | ||||||||||||||||
Prepaid expenses | | | | 339 | | | | | — | | | | | — | | | | | | | 339 | | | | | — | | | | | | | 339 | | | | | | 260 | | | | | — | | | | | — | | | | | | | 260 | | | | | — | | | | | | | 260 | | | ||||||||||||||||
Property and equipment, net | | | | — | | | | | 47,054 | | | | | — | | | | | | | 47,054 | | | | | — | | | | | | | 47,054 | | | | | | — | | | | | 51,627 | | | | | — | | | | | | | 51,627 | | | | | — | | | | | | | 51,627 | | | ||||||||||||||||
Goodwill and intangible assets, net | | | | — | | | | | 151,623 | | | | | — | | | | | | | 151,623 | | | | | — | | | | | | | 151,623 | | | | | | — | | | | | 149,374 | | | | | — | | | | | | | 149,374 | | | | | — | | | | | | | 149,374 | | | ||||||||||||||||
Right-of-use assets, net | | | | — | | | | | 13,864 | | | | | — | | | | | | | 13,864 | | | | | — | | | | | | | 13,864 | | | | | | — | | | | | 11,901 | | | | | — | | | | | | | 11,901 | | | | | — | | | | | | | 11,901 | | | ||||||||||||||||
Other assets | | | | — | | | | | 41,163 | | | | | (5,120) | | | C | | | | 36,043 | | | | | — | | | | | | | 36,043 | | | | | | — | | | | | 44,659 | | | | | (7,208) | | | C | | | | 37,451 | | | | | — | | | | | | | 37,451 | | | ||||||||||||||||
Marketable securities held in Trust Account | | | | 201,309 | | | | | — | | | | | (201,309) | | | B | | | | — | | | | | — | | | | | | | — | | | | | | 201,265 | | | | | — | | | | | (201,265) | | | B | | | | — | | | | | — | | | | | | | — | | | ||||||||||||||||
TOTAL ASSETS | | | $ | 201,711 | | | | $ | 4,611,263 | | | | $ | 75,772 | | | | | | $ | 4,888,746 | | | | $ | (201,309) | | �� | | | | | $ | 4,687,437 | | | | | $ | 201,649 | | | | $ | 4,690,477 | | | | $ | 75,055 | | | | | | $ | 4,967,181 | | | | $ | (201,265) | | | | | | $ | 4,765,916 | | | |||||||||||||||
LIABILITIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||||||||
Payables to brokers, dealers and clearing organizations | | | $ | — | | | | $ | 2,631 | | | | $ | — | | | | | | $ | 2,631 | | | | $ | — | | | | | | $ | 2,631 | | | | | $ | — | | | | $ | 3,494 | | | | $ | — | | | | | | $ | 3,494 | | | | $ | — | | | | | | $ | 3,494 | | | ||||||||||||||||
Securities loaned | | | | — | | | | | 601,575 | | | | | — | | | | | | | 601,575 | | | | | — | | | | | | | 601,575 | | | | | | — | | | | | 680,208 | | | | | — | | | | | | | 680,208 | | | | | — | | | | | | | 680,208 | | | ||||||||||||||||
Payables to brokerage customers | | | | — | | | | | 2,983,708 | | | | | — | | | | | | | 2,983,708 | | | | | — | | | | | | | 2,983,708 | | | | | | — | | | | | 2,907,860 | | | | | — | | | | | | | 2,907,860 | | | | | — | | | | | | | 2,907,860 | | | ||||||||||||||||
Cryptocurrency and stablecoin payables to customers | | | | — | | | | | 280,072 | | | | | — | | | | | | | 280,072 | | | | | — | | | | | | | 280,072 | | | | | | — | | | | | 340,018 | | | | | — | | | | | | | 340,018 | | | | | — | | | | | | | 340,018 | | | ||||||||||||||||
Accounts payable and accrued expenses | | | | 2,642 | | | | | — | | | | | (2,278) | | | H | | | | 364 | | | | | — | | | | | | | 364 | | | | | | 3,006 | | | | | — | | | | | (2,738) | | | H | | | | 268 | | | | | — | | | | | | | 268 | | | ||||||||||||||||
Cryptocurrency collateral received on stablecoin assets lending | | | | — | | | | | 190,876 | | | | | — | | | | | | | 190,876 | | | | | — | | | | | | | 190,876 | | | | | | — | | | | | 217,256 | | | | | — | | | | | | | 217,256 | | | | | — | | | | | | | 217,256 | | | ||||||||||||||||
Operating lease liabilities | | | | — | | | | | 17,471 | | | | | — | | | | | | | 17,471 | | | | | — | | | | | | | 17,471 | | | | | | — | | | | | 16,671 | | | | | — | | | | | | | 16,671 | | | | | — | | | | | | | 16,671 | | | ||||||||||||||||
Notes payable | | | | — | | | | | 268,000 | | | | | — | | | | | | | 268,000 | | | | | — | | | | | | | 268,000 | | | | | | — | | | | | 278,000 | | | | | — | | | | | | | 278,000 | | | | | — | | | | | | | 278,000 | | | ||||||||||||||||
Deferred income taxes, net | | | | — | | | | | 10,866 | | | | | — | | | | | | | 10,866 | | | | | — | | | | | | | 10,866 | | | | | | — | | | | | 7,959 | | | | | — | | | | | | | 7,959 | | | | | — | | | ��� | | | | 7,959 | | | ||||||||||||||||
Other liabilities | | | | — | | | | | 52,931 | | | | | (4,426) | | | H | | | | 48,505 | | | | | — | | | | | | | 48,505 | | | | | | — | | | | | 50,617 | | | | | (5,177) | | | H | | | | 45,440 | | | | | — | | | | | | | 45,440 | | | ||||||||||||||||
Due to affiliated companies | | | | — | | | | | 495 | | | | | — | | | | | | | 495 | | | | | — | | | | | | | 495 | | | | | | — | | | | | 506 | | | | | — | | | | | | | 506 | | | | | — | | | | | | | 506 | | | ||||||||||||||||
Warrant liability | | | | 7,138 | | | | | — | | | | | — | | | | | | | 7,138 | | | | | — | | | | | | | 7,138 | | | | | | 6,479 | | | | | — | | | | | — | | | | | | | 6,479 | | | | | — | | | | | | | 6,479 | | | ||||||||||||||||
Promissory note – related party | | | | 242 | | | | | — | | | | | — | | | | | | | 242 | | | | | — | | | | | | | 242 | | | |||||||||||||||||||||||||||||||||||||||||||||||||||
Monex earn out liability | | | | — | | | | | — | | | | | 271,026 | | | D | | | | 271,026 | | | | | — | | | | | | | 271,026 | | | | | | — | | | | | — | | | | | 277,294 | | | D | | | | 277,294 | | | | | — | | | | | | | 277,294 | | | ||||||||||||||||
Sponsor earn out liability | | | | — | | | | | — | | | | | 7,565 | | | D | | | | 7,565 | | | | | — | | | | | | | 7,565 | | | | | | — | | | | | — | | | | | 7,740 | | | D | | | | 7,740 | | | | | — | | | | | | | 7,740 | | | ||||||||||||||||
PIPE derivative liability | | | | 4,566 | | | | | — | | | | | — | | | | | | | 4,566 | | | | | — | | | | | | | 4,566 | | | | | | 3,200 | | | | | — | | | | | — | | | | | | | 3,200 | | | | | — | | | | | | | 3,200 | | | ||||||||||||||||
Total Liabilities | | | $ | 14,346 | | | | $ | 4,408,625 | | | | $ | 271,887 | | | | | | $ | 4,694,858 | | | | $ | — | | | | | | $ | 4,694,858 | | | | | $ | 12,927 | | | | $ | 4,502,589 | | | | $ | 277,119 | | | | | | $ | 4,792,635 | | | | $ | — | | | | | | $ | 4,792,635 | | |
| | Historical | | Assuming No Redemptions | | Assuming Maximum Redemptions | | | Historical | | Assuming No Redemptions | | Assuming Maximum Redemptions | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| | Quantum Acquisition Corporation | | TradeStation Group Inc. | | Pro Forma Accounting Adjustments (Note 3) | | | | Pro Forma Condensed Combined | | Additional Pro Forma Adjustments (Note 3) | | | | Pro Forma Condensed Combined | | | Quantum Acquisition Corporation | | TradeStation Group Inc. | | Pro Forma Accounting Adjustments (Note 3) | | | | Pro Forma Condensed Combined | | Additional Pro Forma Adjustments (Note 3) | | | | Pro Forma Condensed Combined | | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||||||||
Common stock subject to possible redemption** | | | | 201,250 | | | | | — | | | | | (201,250) | | | E | | | | — | | | | | — | | | | | | | — | | | | | | 201,250 | | | | | — | | | | | (201,250) | | | E | | | | — | | | | | — | | | | | | | — | | | ||||||||||||||||
Stockholders’ Equity (Deficit) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||||||||
TSG: Preferred stock, $0.01 par value* | | | | — | | | | | — | | | | | — | | | | | | | — | | | | | — | | | | | | | — | | | | | | — | | | | | — | | | | | — | | | | | | | — | | | | | — | | | | | | | — | | | ||||||||||||||||
TSG: Common stock, $0.01 par value* | | | | — | | | | | — | | | | | 1,675 | | | E | | | | 1,675 | | | | | (201) | | | B | | | | 1,474 | | | | | | — | | | | | — | | | | | 1,675 | | | E | | | | 1,675 | | | | | (201) | | | B | | | | 1,474 | | | ||||||||||||||||
QFAC: Preferred stock, $0.0001 par value** | | | | — | | | | | — | | | | | — | | | | | | | — | | | | | — | | | | | | | — | | | | | | — | | | | | — | | | | | — | | | | | | | — | | | | | — | | | | | | | — | | | ||||||||||||||||
QFAC: Common stock, $0.0001 par value** | | | | 1 | | | | | — | | | | | (1) | | | E | | | | — | | | | | — | | | | | | | — | | | | | | 1 | | | | | — | | | | | (1) | | | E | | | | — | | | | | — | | | | | | | — | | | ||||||||||||||||
Additional paid-in capital | | | | — | | | | | 171,278 | | | | | 302,162 | | | F | | | | 473,440 | | | | | (201,108) | | | B | | | | 272,332 | | | | | | — | | | | | 171,278 | | | | | 294,944 | | | F | | | | 466,222 | | | | | (201,064) | | | B | | | | 265,158 | | | ||||||||||||||||
Retained earnings (accumulated deficit) | | | | (13,886) | | | | | 31,360 | | | | | (298,701) | | | G | | | | (281,227) | | | | | — | | | | | | | (281,227) | | | | | | (12,529) | | | | | 16,610 | | | | $ | (297,432) | | | G | | | $ | (293,351) | | | | | — | | | | | | $ | (293,351) | | | ||||||||||||||||
Total Stockholders’ Equity (Deficit) | | | | (13,885) | | | | | 202,638 | | | | | 5,135 | | | | | | | 193,888 | | | | | (201,309) | | | | | | | (7,421) | | | | | $ | (12,528) | | | | | 187,888 | | | | $ | (814) | | | | | | $ | 174,546 | | | | | (201,265) | | | | | | $ | (26,719) | | | ||||||||||||||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | | | $ | 201,711 | | | | $ | 4,611,263 | | | | $ | 75,772 | | | | | | $ | 4,888,746 | | | | $ | (201,309) | | | | | | $ | 4,687,437 | | | | | $ | 201,649 | | | | $ | 4,690,477 | | | | $ | 75,055 | | | | | | $ | 4,967,181 | | | | $ | (201,265) | | | | | | $ | 4,765,916 | | | |
| | | Historical | | | Assuming No Redemptions | | | Assuming Maximum Redemptions | | |||||||||||||||||||||||||||||||||
| | | Quantum Acquisition Corporation | | | TradeStation Group Inc. | | | Pro Forma Accounting Adjustments (Note 3) | | | | | | Pro Forma Condensed Combined | | | Additional Pro Forma Adjustments (Note 3) | | | | | | Pro Forma Condensed Combined | | ||||||||||||||||||
Revenues | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total net revenues | | | | $ | — | | | | | $ | 157,007 | | | | | $ | — | | | | | | | | $ | 157,007 | | | | | $ | — | | | | | | | | $ | 157,007 | | |
Expenses | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Employee compensation and benefits | | | | | — | | | | | | 68,628 | | | | | | 7,845 | | | | AA | | | | | 76,473 | | | | | | — | | | | | | | | | 76,473 | | |
Cost of services provided | | | | | — | | | | | | 25,186 | | | | | | — | | | | | | | | | 25,186 | | | | | | — | | | | | | | | | 25,186 | | |
Communications | | | | | — | | | | | | 11,508 | | | | | | — | | | | | | | | | 11,508 | | | | | | — | | | | | | | | | 11,508 | | |
Marketing | | | | | — | | | | | | 39,595 | | | | | | — | | | | | | | | | 39,595 | | | | | | — | | | | | | | | | 39,595 | | |
Professional services | | | | | — | | | | | | 8,123 | | | | | | — | | | | | | | | | 8,123 | | | | | | — | | | | | | | | | 8,123 | | |
Occupancy and equipment | | | | | — | | | | | | 12,329 | | | | | | — | | | | | | | | | 12,329 | | | | | | — | | | | | | | | | 12,329 | | |
Depreciation and amortization or property and equipment | | | | | — | | | | | | 7,983 | | | | | | — | | | | | | | | | 7,983 | | | | | | — | | | | | | | | | 7,983 | | |
Amortization of intangibles | | | | | — | | | | | | 6,693 | | | | | | — | | | | | | | | | 6,693 | | | | | | — | | | | | | | | | 6,693 | | |
Operating and formation costs | | | | | 3,166 | | | | | | — | | | | | | (90) | | | | BB | | | | | 3,076 | | | | | | — | | | | | | | | | 3,076 | | |
Change in fair value of warrant liability | | | | | 5,292 | | | | | | — | | | | | | — | | | | | | | | | 5,292 | | | | | | — | | | | | | | | | 5,292 | | |
Interest earned on marketable securities held in Trust Account | | | | | (56) | | | | | | — | | | | | | 56 | | | | CC | | | | | — | | | | | | — | | | | | | | | | — | | |
Unrealized loss on marketable securities held in Trust Account | | | | | 9 | | | | | | — | | | | | | (9) | | | | CC | | | | | — | | | | | | — | | | | | | | | | — | | |
Change in fair value of PIPE derivative liability | | | | | (966) | | | | | | — | | | | | | — | | | | | | | | | (966) | | | | | | — | | | | | | | | | (966) | | |
Other expense (income) | | | | | — | | | | | | (2,348) | | | | | | — | | | | | | | | | (2,348) | | | | | | — | | | | | | | | | (2,348) | | |
Interest expense on borrowings | | | | | — | | | | | | 2,293 | | | | | | — | | | | | | | | | 2,293 | | | | | | — | | | | | | | | | 2,293 | | |
Total expenses | | | | | 7.445 | | | | | | 179,990 | | | | | | 7,802 | | | | | | | | | 195,237 | | | | | | — | | | | | | | | | 195,237 | | |
Loss before benefit for income taxes | | | | | (7,455) | | | | | | (22,983) | | | | | | (7,802) | | | | | | | | | (38,230) | | | | | | — | | | | | | | | | (38,230) | | |
Benefit for income taxes | | | | | — | | | | | | (6,037) | | | | | | (2,049) | | | | DD | | | | | (8,086) | | | | | | — | | | | | | | | | (8,086) | | |
Net loss | | | | $ | (7,445) | | | | | $ | (16,946) | | | | | $ | (5,753) | | | | | | | | $ | (30,144) | | | | | $ | — | | | | | | | | $ | (30,144) | | |
Loss per Share | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Weighted average shares outstanding | | | | | | | | | | | | | | | | | | | | | | | | | | 167,462,292 | | | | | | (20,875,000) | | | | EE | | | | | 146,587,292 | | |
Loss per share (basic and diluted) attributable to common stockholders | | | | | | | | | | | | | | | | | | | | | | | | | $ | (0.18) | | | | | | | | | | | | | | $ | (0.21) | | |
| | | Historical | | | Assuming No Redemptions | | | Assuming Maximum Redemptions | | |||||||||||||||||||||||||||||||||
| | | Quantum Acquisition Corporation* | | | TradeStation Group Inc. | | | Pro Forma Accounting Adjustments (Note 3) | | | | | | Pro Forma Condensed Combined | | | Additional Pro Forma Adjustments (Note 3) | | | | | | Pro Forma Condensed Combined | | ||||||||||||||||||
Revenues | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total net revenues | | | | $ | — | | | | | $ | 218,652 | | | | | $ | — | | | | | | | | $ | 218,652 | | | | | $ | — | | | | | | | | $ | 218,652 | | |
Expenses | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Employee compensation and benefits | | | | | — | | | | | | 74,297 | | | | | | 21,577 | | | | FF | | | | | 95,874 | | | | | | — | | | | | | | | | 95,874 | | |
Cost of services provided | | | | | — | | | | | | 33,493 | | | | | | — | | | | | | | | | 33,493 | | | | | | — | | | | | | | | | 33,493 | | |
Communications | | | | | — | | | | | | 14,191 | | | | | | — | | | | | | | | | 14,191 | | | | | | — | | | | | | | | | 14,191 | | |
Marketing | | | | | — | | | | | | 17,395 | | | | | | — | | | | | | | | | 17,395 | | | | | | — | | | | | | | | | 17,395 | | |
Professional services | | | | | — | | | | | | 6,321 | | | | | | — | | | | | | | | | 6,321 | | | | | | — | | | | | | | | | 6,321 | | |
Occupancy and equipment | | | | | — | | | | | | 13,439 | | | | | | — | | | | | | | | | 13,439 | | | | | | — | | | | | | | | | 13,439 | | |
Depreciation and amortization or property and equipment | | | | | — | | | | | | 10,130 | | | | | | — | | | | | | | | | 10,130 | | | | | | — | | | | | | | | | 10,130 | | |
Amortization of intangibles | | | | | — | | | | | | 8,942 | | | | | | — | | | | | | | | | 8,942 | | | | | | — | | | | | | | | | 8,942 | | |
Operating and formation costs | | | | | 243 | | | | | | — | | | | | | 3,004 | | | | GG | | | | | 3,247 | | | | | | — | | | | | | | | | 3,247 | | |
Other expenses (income) | | | | | — | | | | | | 4,741 | | | | | | 3,013 | | | | HH | | | | | 7,754 | | | | | | — | | | | | | | | | 7,754 | | |
Change in fair value of warrant liability | | | | | (1,969) | | | | | | — | | | | | | — | | | | | | | | | (1,969) | | | | | | — | | | | | | | | | (1,969) | | |
Unrealized loss on marketable securities held in Trust Account | | | | | (11) | | | | | | — | | | | | | 11 | | | | II | | | | | — | | | | | | — | | | | | | | | | — | | |
Interest expense on borrowings | | | | | — | | | | | | 3,070 | | | | | | — | | | | | | | | | 3,070 | | | | | | — | | | | | | | | | 3,070 | | |
Total expenses | | | | | (1,737) | | | | | | 186,019 | | | | | | 27,605 | | | | | | | | | 211,887 | | | | | | — | | | | | | | | | 211,887 | | |
Income (loss) before income taxes | | | | | 1,737 | | | | | | 32,633 | | | | | | (27,605) | | | | | | | | | 6,765 | | | | | | — | | | | | | | | | 6,765 | | |
Provision (benefit) for income taxes | | | | | — | | | | | | 8,843 | | | | | | (7,480) | | | | JJ | | | | | 1,363 | | | | | | — | | | | | | | | | 1,363 | | |
Net income (loss) | | | | $ | 1,737 | | | | | $ | 23,790 | | | | | $ | (20,125) | | | | | | | | $ | 5,402 | | | | | $ | — | | | | | | | | $ | 5,402 | | |
Earnings (loss) per Share | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Weighted average shares outstanding (basic) | | | | | | | | | | | | | | | | | | | | | | | | | | 167,462,292 | | | | | | (20,875,000) | | | | EE | | | | | 146,587,292 | | |
Earnings per share (basic) attributable to common stockholders | | | | | | | | | | | | | | | | | | | | | | | | | $ | 0.03 | | | | | | | | | | | | | | $ | 0.04 | | |
Weighted average shares outstanding (diluted) | | | | | | | | | | | | | | | | | | | | | | | | | | 168,468,011 | | | | | | | | | | | | | | | 147,593,011 | | |
Earnings per share (diluted) attributable to common stockholders | | | | | | | | | | | | | | | | | | | | | | | | | $ | 0.03 | | | | | | | | | | | | | | $ | 0.04 | | |
| | | Historical | | | Assuming No Redemptions | | | Assuming Maximum Redemptions | | |||||||||||||||||||||||||||||||||
| | | Quantum Acquisition Corporation | | | TradeStation Group Inc. | | | Pro Forma Accounting Adjustments (Note 3) | | | | | | Pro Forma Condensed Combined | | | Additional Pro Forma Adjustments (Note 3) | | | | | | Pro Forma Condensed Combined | | ||||||||||||||||||
Revenues | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total net revenues | | | | $ | — | | | | | $ | 209,619 | | | | | $ | — | | | | | | | | $ | 209,619 | | | | | $ | — | | | | | | | | $ | 209,619 | | |
Expenses | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Employee compensation and benefits | | | | | — | | | | | | 91,664 | | | | | | 20,786 | | | | AA | | | | | 112,450 | | | | | | — | | | | | | | | | 112,450 | | |
Cost of services provided | | | | | — | | | | | | 35,345 | | | | | | — | | | | | | | | | 35,345 | | | | | | — | | | | | | | | | 35,345 | | |
Communications | | | | | — | | | | | | 15,543 | | | | | | — | | | | | | | | | 15,543 | | | | | | — | | | | | | | | | 15,543 | | |
Marketing | | | | | — | | | | | | 57,733 | | | | | | — | | | | | | | | | 57,733 | | | | | | — | | | | | | | | | 57,733 | | |
Professional services | | | | | — | | | | | | 10,091 | | | | | | — | | | | | | | | | 10,091 | | | | | | — | | | | | | | | | 10,091 | | |
Occupancy and equipment | | | | | — | | | | | | 16,740 | | | | | | — | | | | | | | | | 16,740 | | | | | | — | | | | | | | | | 16,740 | | |
Depreciation and amortization or property and equipment | | | | | — | | | | | | 10,758 | | | | | | — | | | | | | | | | 10,758 | | | | | | — | | | | | | | | | 10,758 | | |
Amortization of intangibles | | | | | — | | | | | | 8,942 | | | | | | — | | | | | | | | | 8,942 | | | | | | — | | | | | | | | | 8,942 | | |
Operating and formation costs | | | | | 3,855 | | | | | | — | | | | | | 2,410 | | | | BB | | | | | 6,265 | | | | | | — | | | | | | | | | 6,265 | | |
Change in fair value of warrant liability | | | | | 4,633 | | | | | | — | | | | | | — | | | | | | | | | 4,633 | | | | | | — | | | | | | | | | 4,633 | | |
Interest earned on marketable securities held in Trust Account | | | | | (77) | | | | | | — | | | | | | 77 | | | | CC | | | | | — | | | | | | — | | | | | | | | | — | | |
Unrealized loss on marketable securities held in Trust Account | | | | | 9 | | | | | | — | | | | | | (9) | | | | CC | | | | | — | | | | | | — | | | | | | | | | — | | |
Change in fair value of PIPE derivative liability | | | | | (2,332) | | | | | | — | | | | | | — | | | | | | | | | (2,332) | | | | | | — | | | | | | | | | (2,332) | | |
Other expense (income) | | | | | — | | | | | | (1,355) | | | | | | 3,074 | | | | DD | | | | | 1,719 | | | | | | — | | | | | | | | | 1,719 | | |
Interest expense on borrowings | | | | | — | | | | | | 3,260 | | | | | | — | | | | | | | | | 3,260 | | | | | | — | | | | | | | | | 3,260 | | |
Total expenses | | | | | 6,088 | | | | | | 248,721 | | | | | $ | 26,338 | | | | | | | | $ | 281,147 | | | | | | — | | | | | | | | $ | 281,147 | | |
Loss before benefit for income taxes | | | | | (6,088) | | | | | | (39,102) | | | | | $ | (26,338) | | | | | | | | $ | (71,528) | | | | | | — | | | | | | | | $ | (71,528) | | |
Benefit for income taxes | | | | | — | | | | | | (7,406) | | | | | $ | (5,359) | | | | EE | | | | $ | (12,765) | | | | | | — | | | | | | | | $ | (12,765) | | |
Net loss | | | | $ | (6,088) | | | | | $ | (31,696) | | | | | $ | (20,979) | | | | | | | | $ | (58,763) | | | | | $ | — | | | | | | | | $ | (58,763) | | |
Loss per Share | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Weighted average shares outstanding | | | | | | | | | | | | | | | | | | | | | | | | | | 167,462,292 | | | | | | (20,875,000) | | | | FF | | | | | 146,587,292 | | |
Loss per share (basic and diluted) attributable to common stockholders | | | | | | | | | | | | | | | | | | | | | | | | | $ | (0.35) | | | | | | | | | | | | | | $ | (0.40) | | |
| | ($ in thousands) | | | | | | | | ($ in thousands) | | | | | | | ||||||||||
Reclassification of investments held in Quantum Trust Account | | | $ | 201,309 | | | | | (i) | | | | | $ | 201,265 | | | | | (i) | | | ||||
Settlement of estimated transaction costs | | | | (44,108) | | | | | (ii) | | | | | | (42,737) | | | | | (ii) | | | ||||
Proceeds from PIPE Investment – Third Party | | | | 75,000 | | | | | (iii) | | | | | | 75,000 | | | | | (iii) | | | ||||
Proceeds from PIPE Investment – Monex | | | | 50,000 | | | | | (iv) | | | | | | 50,000 | | | | | (iv) | | | ||||
| | | $ | 282,201 | | | | | | | | | | $ | 283,528 | | | | | | | |
| | ($ in thousands) | | | | | | | | ($ in thousands) | | | | | | | ||||||||||
Capitalize estimated transaction costs for TradeStation and Quantum | | | $ | (36,487) | | | | | (ii) | | | | | $ | (36,426) | | | | | (ii) | | | ||||
Issuance of TradeStation Shares to PIPE Investors | | | | 124,999 | | | | | (iii)(iv) | | | | | | 124,999 | | | | | (iii)(iv) | | | ||||
Reclassification of Public Shares subject to redemption | | | | 201,248 | | | | | (v) | | | | | | 201,248 | | | | | (v) | | | ||||
Elimination of Quantum accumulated deficit | | | | (13,886) | | | | | (vi) | | | | | | (12,529) | | | | | (vi) | | | ||||
Pre-closing TradeStation reorganization | | | | (1,298) | | | | | (vii) | | | | | | (1,298) | | | | | (vii) | | | ||||
Executive equity awards | | | | 27,959 | | | | | (viii) | | | | | | 19,313 | | | | | (viii) | | | ||||
Par value adjustment | | | | (363) | | | | | (ix) | | | | | | (363) | | | | | (ix) | | | ||||
Issuance of vested executive equity awards | | | | (10) | | | | | (F) | | | |||||||||||||||
| | | $ | 302,162 | | | | | | | | | | $ | 294,944 | | | | | | | |
| | ($ in thousands) | | | | | | | | ($ in thousands) | | | | | | | ||||||||||
Elimination of Quantum accumulated deficit | | | $ | 13,886 | | | | | (vi) | | | | | $ | 12,529 | | | | | (vi) | | | ||||
Transaction cost allocated to the Earn Out Shares | | | | (3,013) | | | | | (ii) | | | | | | (3,074) | | | | | (ii) | | | ||||
Quantum transaction cost | | | | (3,024) | | | | | (x) | | | | | $ | (2,530) | | | | | (x) | | | ||||
Monex Earn Out liability | | | | (271,026) | | | | | (D) | | | | | | (277,294) | | | | | (D) | | | ||||
Sponsor Earn Out liability | | | | (7,565) | | | | | (D) | | | | | | (7,740) | | | | | (D) | | | ||||
Executive equity awards | | | | (27,959) | | | | | (viii) | | | | | | (19,323) | | | | | (viii) | | | ||||
| | | $ | (298,701) | | | | | | | | | | $ | (297,432) | | | | | | | |
| | Year Ended March 31, 2021 | | Nine Months Ended December 31, 2021 | | | Year Ended March 31, 2022 | | ||||||||||||||||||||||||||||||||||||||||||||||||
| | No Redemption Scenario | | 50% Redemption Scenario | | Maximum Redemption Scenario | | No Redemption Scenario | | 50% Redemption Scenario | | Maximum Redemption Scenario | | | No Redemption Scenario | | 50% Redemption Scenario | | Maximum Redemption Scenario | | ||||||||||||||||||||||||||||||||||||
| | (dollars in thousands, except share and per share data) | | | (dollars in thousands, except share and per share data) | | ||||||||||||||||||||||||||||||||||||||||||||||||||
Pro forma net income (loss) | | | $ | 5,402 | | | | $ | 5,402 | | | | $ | 5,402 | | | | $ | (30,144) | | | | $ | (30,144) | | | | $ | (30,144) | | | |||||||||||||||||||||||||
Pro forma net loss | | | $ | (58,763) | | | | $ | (58,763) | | | | $ | (58,763) | | | ||||||||||||||||||||||||||||||||||||||||
Pro Forma weighted average shares calculation, basic and diluted | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||||||
Public Shares and Sponsor Shares (1)(2) | | | | 23,496,802 | | | | | 23,496,802 | | | | | 23,496,802 | | | | | 23,496,802 | | | | | 23,496,802 | | | | | 23,496,802 | | | | | | 23,496,802 | | | | | 23,496,802 | | | | | 23,496,802 | | | |||||||||
Quantum third-party PIPE shares (3)(4) | | | | 8,250,000 | | | | | 8,250,000 | | | | | 8,250,000 | | | | | 8,250,000 | | | | | 8,250,000 | | | | | 8,250,000 | | | | | | 8,250,000 | | | | | 8,250,000 | | | | | 8,250,000 | | | |||||||||
TradeStation Stockholder(5) | | | | 129,750,000 | | | | | 129,750,000 | | | | | 129,750,000 | | | | | 129,750,000 | | | | | 129,750,000 | | | | | 129,750,000 | | | | | | 129,750,000 | | | | | 129,750,000 | | | | | 129,750,000 | | | |||||||||
Monex PIPE shares | | | | 5,000,000 | | | | | 5,000,000 | | | | | 5,000,000 | | | | | 5,000,000 | | | | | 5,000,000 | | | | | 5,000,000 | | | | | | 5,000,000 | | | | | 5,000,000 | | | | | 5,000,000 | | | |||||||||
Executive shares | | | | 965,490 | | | | | 965,490 | | | | | 965,490 | | | | | 965,490 | | | | | 965,490 | | | | | 965,490 | | | | | | 965,490 | | | | | 965,490 | | | | | 965,490 | | | |||||||||
Redemptions | | | | — | | | | | (10,062,500) | | | | | (20,875,000) | | | | | — | | | | | (10,062,500) | | | | | (20,875,000) | | | | | | — | | | | | (10,062,500) | | | | | (20,875,000) | | | |||||||||
Pro forma weighted average shares outstanding (basic) | | | | 167,462,292 | | | | | 157,399,792 | | | | | 146,587,292 | | | | | 167,462,292 | | | | | 157,399,792 | | | | | 146,587,292 | | | | | | 167,462,292 | | | | | 157,399,792 | | | | | 146,587,292 | | | |||||||||
Net income (loss) per share (basic) attributable to common stockholders | | | $ | 0.03 | | | | $ | 0.03 | | | | $ | 0.04 | | | | $ | (0.18) | | | | $ | (0.19) | | | | $ | (0.21) | | | |||||||||||||||||||||||||
Net loss per share (basic) attributable to common stockholders | | | $ | (0.35) | | | | $ | (0.37) | | | | $ | (0.40) | | | ||||||||||||||||||||||||||||||||||||||||
Year ended March 31, 2021 pro forma weighted average shares outstanding (diluted) (6) | | | | 168,468,011 | | | | | 158,405,511 | | | | | 147,593,011 | | | | | 167,462,292 | | | | | 157,399,792 | | | | | 146,587,292 | | | | | | 167,462,292 | | | | | 157,399,792 | | | | | 146,587,292 | | | |||||||||
Net income (loss) per share (diluted) attributable to common stock holders | | | $ | 0.03 | | | | $ | 0.03 | | | | $ | 0.04 | | | | $ | (0.18) | | | | $ | (0.19) | | | | $ | (0.21) | | | |||||||||||||||||||||||||
Net loss per share (diluted) attributable to common stock holders | | | $ | (0.35) | | | | $ | (0.37) | | | | $ | (0.40) | | |
Name | | | Age | | | Position | |
Executive Officers | | | | | | | |
John Bartleman | | | 50 | | | President; Chief Executive Officer; Chairman of the Board | |
Takashi Oyagi | | | 53 | | | Chief Strategic Officer; Director | |
Marc Stone | | | 61 | | | Chief Legal Officer; General Counsel; Secretary | |
Greg Vance | | | 53 | | | Chief Financial Officer | |
Peter Korotkiy | | | 53 | | | Chief Brokerage Officer | |
Michael Fisch | | | 49 | | | Chief Technology Officer | |
Directors | | | | | | | |
Oki Matsumoto | | | 58 | | | Director | |
Jun Makihara | | | 64 | | | Director | |
Denise Dickins | | | 60 | | | Director nominee | |
Ellen Ellison | | | 63 | | | Director nominee | |
George W. Wellde, Jr. | | | 69 | | | Director nominee | |
John Schaible | | | 51 | | | Director nominee | |
Sandip I. Patel | | | 55 | | | Director nominee | |
| | | Amount of Working Capital Loans(1) | | |||
John M. Schaible, Chairman and CEO | | | | $ | 21,244 | | |
Miguel Leon, CFO and Director | | | | $ | 45,526 | | |
Daniel Caamano V, President and Director | | | | $ | 49,722 | | |
Sandip Patel, Director(2) | | | | $ | 196,401 | | |
Thomas J. Hammond, Director | | | | $ | 0 | | |
Richard Korhammer, Director | | | | $ | 0 | | |
Steven J. Carlson, Director | | | | $ | 0 | | |
| | | TradeStation | | | Quantum | |
Authorized and Outstanding Capital Stock | | | The authorized capital stock of TradeStation consists of 750,000,000 TradeStation Shares and 25,000,000 shares of preferred stock, of which 1,000 TradeStation Shares and zero shares of preferred stock are outstanding. | | | The authorized capital stock of Quantum consists of 101,000,000 shares of capital stock, including 100,000,000 Quantum Shares and 1,000,000 shares of preferred stock, of which 25,156,250 Quantum Shares and zero shares of preferred stock are issued and outstanding. | |
Special Meetings of Stockholders | | | Except as otherwise required by law and subject to the rights of the holders of any series of preferred shares of TradeStation, special meetings of the stockholders of TradeStation for any purpose or purposes may be called at any time only by or at the direction of the TradeStation Board or the chair of the TradeStation Board; provided, however, that at any time when Monex as beneficial stockholders own, in the aggregate, at least 50% of the total voting power of all then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, special meetings of the | | | Subject to the rights, if any, of the holders of any outstanding series of the preferred stock, and to the requirements of applicable law, special meetings of stockholders of Quantum may be called only by the chairman of the Quantum Board, the chief executive officer of Quantum, or the Quantum Board pursuant to a resolution adopted by a majority of the Quantum Board, and the ability of the stockholders of Quantum to call a special meeting is hereby specifically denied. Except as provided in the foregoing sentence, special meetings of stockholders of Quantum may not be called by another person or persons. | |
| | | TradeStation | | | Quantum | |
| | | stockholders of TradeStation for any purpose or purposes may also be called by or at the direction of the TradeStation Board or the chair of the TradeStation Board at the request of Monex. | | | | |
Action by Written Consent | | | At any time when Monex owns, in the aggregate, at least 50% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, any action required or permitted to be taken at any annual or special meeting of stockholders of TradeStation may be taken without a meeting, without prior notice and without a vote, only if a consent or consents, setting forth the action so taken, shall be signed (i) by or on behalf of Monex and (ii) by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted and shall be delivered to TradeStation in accordance with the applicable provisions of the FBCA. At any time when Monex owns, in the aggregate, less than 50% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, any action required or permitted to be taken by the stockholders of TradeStation must be effected at a duly called annual or special meeting of such holders and may not be effected by any consent of stockholders in lieu of a meeting. | | | Except as may be otherwise provided for or fixed pursuant to the Amended and Restated Certificate of Incorporation (including any preferred stock designation) relating to the rights of the holders of any outstanding series of Preferred Stock, subsequent to the consummation of the IPO, any action required or permitted to be taken by the stockholders of Quantum must be effected by a duly called annual or special meeting of such stockholders and may not be effected by written consent of the stockholders of Quantum. | |
Quorum | | | A majority of the shares entitled to vote, represented in person or by proxy, shall constitute a quorum at a meeting of stockholders of TradeStation. When a specified item of business is required to be voted on by a class or series of stock, a majority of the shares of such class or series shall constitute a quorum for the transaction of such item of business by that class or series. | | | Except as otherwise provided by applicable law, the Certificate of Incorporation or the By Laws of Quantum, the presence, in person or by proxy, at a stockholders meeting of the holders of shares of outstanding capital stock of the Corporation representing a majority of the voting power of all outstanding shares of capital stock of Quantum entitled to vote at such meeting shall constitute a quorum for the transaction of business at such | |
| | | TradeStation | | | Quantum | |
| | | | | | meeting, except that when specified business is to be voted on by a class or series of stock voting as a class, the holders of shares representing a majority of the voting power of the outstanding shares of such class or series shall constitute a quorum of such class or series for the transaction of such business. | |
Notice of Meetings | | | Except as provided under “Action by Written Consent” above, TradeStation shall notify stockholders of the date, time and place of each annual and special stockholders’ meeting no fewer than 10 or more than 60 days before the meeting date. | | | Written notice of each stockholders meeting stating the place, if any, date, and time of the meeting, and the means of remote communication, if any, by which stockholders and proxy holders may be deemed to be present in person and vote at such meeting, and the record date for determining the stockholders entitled to vote at the meeting, if such date is different from the record date for determining stockholders entitled to notice of the meeting, shall be given to each stockholder entitled to vote thereat as of the record date for determining the stockholders entitled to notice of the meeting, by Quantum not less than 10 nor more than 60 days before the date of the meeting unless otherwise required by the DGCL | |
Advance Notice Provisions | | | No equivalent provision. | | | Advance notice of stockholder nominations for the election of directors and of business to be brought by stockholders before any meeting of the stockholders of Quantum shall be given in the manner provided in the Bylaws of Quantum. | |
Bylaw Amendments | | | The TradeStation Board may make, repeal, alter, amend and rescind, in whole or in part, the Amended Bylaws without the assent or vote of TradeStation stockholders in any manner not inconsistent with the FBCA or other applicable law or the Amended Charter; provided that at any time when Monex owns, in the aggregate, less than 50% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, in addition to any vote of the holders of any class or series of capital stock of TradeStation required by the Amended Charter, the affirmative vote of the holders of at least | | | The Quantum Board shall have the power to adopt, amend, alter or repeal the By Laws. The affirmative vote of a majority of the Board shall be required to adopt, amend, alter or repeal the By Laws. The By Laws also may be adopted, amended, altered or repealed by the stockholders; provided, however, that in addition to any vote of the holders of any class or series of capital stock of the Corporation required by applicable law or the Certificate of Incorporation, the affirmative vote of the holders of at least a majority of the voting (except as otherwise provided in Section 8.7 of the By-Laws) power of all outstanding shares of capital stock of the | |
| | | TradeStation | | | Quantum | |
| | | 662∕3% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote thereon, voting together as a single class, shall be required in order for the stockholders of TradeStation to alter, amend, repeal or rescind, in whole or in part, any provision of the Amended Bylaws or to adopt any provision inconsistent herewith. | | | Corporation entitled to vote generally in the election of directors, voting together as a single class, shall be required for the stockholders to adopt, amend, alter or repeal the By Laws. | |
Charter Amendments | | | At any time when Monex owns, in the aggregate, less than 50% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, in addition to any greater or additional vote required by applicable law or the Amended Charter, the following provisions in the Amended Charter may be amended, altered, repealed or rescinded, in whole or in part, or any provision inconsistent therewith may be adopted, only by the affirmative vote of the holders of at least 662∕3% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote thereon, voting together as a single class: Article V, Article VI, Article VIII, Article XI and Article XII. | | | Quantum reserves the right at any time and from time to time to amend, alter, change or repeal any provision contained in Quantum’s Amended and Restated Certificate of Incorporation (including any preferred stock designation), and other provisions authorized by the laws of the State of Delaware at the time in force that may be added or inserted, in the manner now or hereafter prescribed by Quantum’s Amended and Restated Certificate and the DGCL. | |
Size of Board, Election of Directors | | | The number of directors shall be determined from time to time by resolution adopted by the TradeStation Board. The directors (other than those directors elected by holders of any series of preferred shares), voting separately as a series or together with one or more such series, as the case may be, shall be divided into three classes designated Class I, Class II, Class III. Each class shall consist, as nearly as possible, of one-third of the total number of such directors. Class I directors shall initially serve for a term expiring at the first annual meeting of stockholders following the date the TradeStation Shares are first publicly traded after the date of the Restated Articles (the “Listing Date”), Class II directors shall initially serve for a term expiring at the second annual meeting of stockholders following the Listing Date and Class III | | | Quantum’s Amended and Restated Certificate of Incorporation provides that the number of directors of Quantum, other than those who may be elected by the holders of one or more series of the preferred stock voting separately by class or series, shall be fixed from time to time exclusively by the Quantum Board pursuant to a resolution adopted by a majority of the Quantum Board. | |
| | | TradeStation | | | Quantum | |
| | | directors shall initially serve for a term expiring at the third annual meeting of stockholders following the Listing Date. At each annual meeting of stockholders commencing with the first annual meeting following the Listing Date, the directors of the class to be elected at each annual meeting shall be elected for a three-year term. If the total number of such directors is changed, any increase or decrease shall be apportioned among the classes so as to maintain the number of directors in each class as nearly equal as possible, and any such additional director of any class elected to fill a newly created directorship resulting from an increase in such class shall hold office for a term that shall coincide with the remaining term of that class, but in no case shall a decrease in the total number of directors remove or shorten the term of any incumbent director. Any such director shall hold office until the annual meeting at which his or her term expires and until his or her successor shall be elected and qualified, or his or her earlier death, resignation, retirement, disqualification or removal from office. The TradeStation Board may assign members of the TradeStation Board already in office to their respective class. | | | | |
Removal of Directors | | | Any or all of the directors, voting separately as a series or together with one or more other such series, may be removed from office at any time, with or without cause, by the affirmative vote of a majority in voting power of all outstanding share of stock of TradeStation entitled to vote thereon, voting together as a single class; provided, however, that at any time when Monex owns, in the aggregate, less than 50% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, any such director or all such directors may be removed only for cause and only upon the affirmative vote of the holders of at least 662∕3% of the total voting power of all then outstanding shares of stock of TradeStation entitles to vote thereon, voting together as a single class. | | | Any or all of the directors may be removed from office at any time, but only for cause and only by the affirmative vote of holders of a majority of the voting power of all then outstanding shares of capital stock of Quantum entitled to vote generally in the election of directors, voting together as a single class. | |
| | | TradeStation | | | Quantum | |
Board Vacancies and Newly Created Directorships | | | Any vacancy occurring in the TradeStation Board (whether by death, resignation, retirement, disqualification, removal or other cause) shall be filled by the affirmative vote of a majority of the directors then in office (other than directors elected by the holders of any series of preferred shares, voting separately as a series or together with one or more series, as the case may be), although less than a quorum, by a sole remaining director or by the stockholders; provided, however, that, subject to the rights granted to holders of one or more series of preferred shares then outstanding, at any time when Monex owns, in the aggregate, less than 50% of the total voting power of all then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, any newly-created directorship on the TradeStation Board that results from an increase in the number of directors and any vacancy occurring in the TradeStation Board shall be filled only by an affirmative vote of a majority of the directors then in office, although less than a quorum, or by a sole remaining director (and not by stockholders) (other than directors elected by the holders of any series of preferred shares, by voting separately as a series or together with one or more series, as the case may be). | | | Quantum’s articles provide that newly created directorships resulting from an increase in the number of directors and any vacancies on the Quantum Board resulting from death, resignation, retirement, disqualification, removal or other cause may be filled solely and exclusively by a majority vote of the remaining directors then in office, even if less than a quorum, or by a sole remaining director (and not by stockholders), and any director so chosen shall hold office for the remainder of the full term of the class of directors to which the new directorship was added or in which the vacancy occurred and until his or her successor has been elected and qualified, subject, however, to such director’s earlier death, resignation, retirement, disqualification or removal. | |
Corporate Opportunity | | | To the fullest extent permitted by law, TradeStation renounces any interest or expectancy in, or right to be offered an opportunity to participate in, any business opportunity which may be a corporate opportunity for an identified person and TradeStation or any of its affiliates, except as provided in Section (C) of Article VI of the Amended Charter. In the event that any identified person acquires knowledge of a potential transaction or other business opportunity which may be a corporate opportunity for itself, herself or himself and TradeStation or any of its affiliates, such identified person shall, to the fullest extent permitted by law, have no duty to communicate or offer such transaction or other business opportunity to | | | To the extent allowed by law, the doctrine of corporate opportunity, or any other analogous doctrine, shall not apply with respect to Quantum or any of its officers or directors, or any of their respective affiliates, in circumstances where the application of any such doctrine would conflict with any fiduciary duties or contractual obligations they may have as of the date of Quantum’s Amended and Restated Certificate of Incorporation or in the future, and Quantum renounces any expectancy that any of the directors or officers of Quantum will offer any such corporate opportunity of which he or she may become aware to Quantum, except, the doctrine of corporate opportunity shall apply with respect to | |
| | | TradeStation | | | Quantum | |
| | | TradeStation or any of its affiliates and, to the fullest extent permitted by law, shall not be liable to TradeStation or its stockholders or to any affiliate of TradeStation for breach of any fiduciary duty as a stockholder, director or officer of TradeStation solely by reason of the fact that such identified person pursues or acquires such corporate opportunity for itself, herself or himself, or offers or directs such corporate opportunity to another person or does not communicate information regarding such corporate opportunity to TradeStation. | | | any of the directors or officers of Quantum only with respect to a corporate opportunity that was offered to such person solely in his or her capacity as a director or officer of Quantum and (i) such opportunity is one Quantum is legally and contractually permitted to undertake and would otherwise be reasonable for Quantum to pursue and (ii) the director or officer is permitted to refer that opportunity to Quantum without violating any legal obligation. | |
Exclusive Forum | | | Unless TradeStation consents in writing to the selection of an alternative forum, the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of TradeStation, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of TradeStation to TradeStation or TradeStation’s stockholders, (iii) an action asserting a claim arising pursuant to any provision of the FBCA or (iv) any action asserting a claim governed by the internal affairs doctrine shall be a state or federal court located within the state of Florida, in all cases subject to the court’s having personal jurisdiction over the indispensable parties named as defendants. | | | Unless Quantum consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall be the sole and exclusive forum for any stockholder (including a beneficial owner) to bring (i) any derivative action or proceeding brought on behalf of Quantum, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee or agent of Quantum to Quantum or Quantum’s stockholders, or any claim for aiding and abetting any such alleged breach, (iii) any action asserting a claim against Quantum, its directors, officers or employees arising pursuant to any provision of the DGCL or Quantum’s Amended and Restated Certificate of Incorporation or Bylaws or (iv) any action asserting a claim against Quantum, its directors, officers or employees governed by the internal affairs doctrine, except for, as to each of (i) through (iv) above, any claim as to which the Court of Chancery determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, or for which the Court of Chancery does not have subject matter jurisdiction. This exclusive forum provision will not apply to suits brought to enforce any duty or | |
| | | TradeStation | | | Quantum | |
| | | | | | liability created by the Exchange Act, the Securities Act or any other claim for which the federal courts have exclusive jurisdiction. Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder and Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. As a result, the exclusive forum provision will not apply to suits brought to enforce any duty or liability created by the Exchange Act, the Securities Act or any other claim for which the federal courts have exclusive jurisdiction. | |
Limitation of Liability | | | A director of TradeStation shall not be personally liable to TradeStation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director’s duty of loyalty to TradeStation or its stockholders, taking into account Article VI of the Amended Charter in determining the director’s duty of loyalty, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 607.0834 of the FBCA, as the same exists or hereafter may be amended, (iv) for violation of a criminal law, unless the director had reasonable cause to believe the director’s conduct was lawful or had no reasonable cause to believe the director’s conduct was unlawful or (v) for any transaction from which the director derived an improper personal benefit. If the FBCA is amended or interpreted to authorize the further elimination or limitation of the liability of directors, then the liability of TradeStation’s directors shall be eliminated or limited to the full extent authorized by the FBCA, as so amended or interpreted. | | | A director of Quantum shall not be personally liable to Quantum or its stockholders for monetary damages for breach of fiduciary duty as a director, except to the extent such exemption from liability or limitation thereof is not permitted under the DGCL as the same exists or may hereafter be amended unless a director violated his or her duty of loyalty to Quantum or its stockholders, acted in bad faith, knowingly or intentionally violated the law, authorized unlawful payments of dividends, unlawful stock purchases or unlawful redemptions, or derived improper personal benefit from his or her actions as a director. Any amendment, modification or repeal of the foregoing sentence shall not adversely affect any right or protection of a director of Quantum hereunder in respect of any act or omission occurring prior to the time of such amendment, modification or repeal. | |
| | | TradeStation | | | Quantum | |
Indemnification and Contribution | | | TradeStation shall indemnify any person who was or is a party to any proceeding (other than an action by, or in the right of, TradeStation), by reason of the fact that he or she is or was a director or officer of TradeStation and may so indemnify any employee or agent of TradeStation or any person who was serving at the request of TradeStation as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise against liability incurred in connection with such proceeding, including any appeal thereof, if he or she acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, the best interests of TradeStation and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful. | | | To the fullest extent permitted by applicable law, Quantum shall indemnify, defend and hold harmless each person who is or was made a party or is threatened to be made a party to or is otherwise involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (a “proceeding”) by reason of the fact that he or she is or was a director or officer of Quantum or, while a director or officer of Quantum, is or was serving at the request of Quantum as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust, other enterprise or nonprofit entity, including service with respect to an employee benefit plan (an “indemnitee”), whether the basis of such proceeding is alleged action in an official capacity as a director, officer, employee or agent, or in any other capacity while serving as a director, officer, employee or agent, against all liability and loss suffered and expenses (including, without limitation, attorneys’ fees, judgments, fines, the Employee Retirement Income Security Act of 1974, excise taxes and penalties and amounts paid in settlement) reasonably incurred by such indemnitee in connection with such proceeding. Quantum shall to the fullest extent not prohibited by applicable law pay the expenses (including attorneys’ fees) incurred by an indemnitee in defending or otherwise participating in any proceeding in advance of its final disposition; provided, however, that, to the extent required by applicable law, such payment of expenses in advance of the final disposition of the proceeding shall be made only upon receipt of an undertaking, by or on behalf of the indemnitee, to repay all amounts so advanced if it shall ultimately be determined that the indemnitee is not entitled to be indemnified. | |
| | | | | | After the Merger | | ||||||||||||||||||||||||||||||
| | | Before the Merger | | | Assuming No Redemptions | | | Assuming Illustrative Maximum Redemptions | | |||||||||||||||||||||||||||
Name and Address of Beneficial Owner | | | Number of Quantum Shares | | | % | | | Number of TradeStation Shares | | | % | | | Number of TradeStation Shares | | | % | | ||||||||||||||||||
Directors and Executive Officers of Quantum Pre-Merger(1) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
John Schaible | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | |
Daniel Caamano, V(2) | | | | | 41,233 | | | | | | * | | | | | | 41,233 | | | | | | * | | | | | | 41,233 | | | | | | * | | |
Miguel Leon | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | |
Steven J. Carlson | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | |
Thomas J. Hammond | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | |
Richard Korhammer | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | |
Sandip I. Patel(3) | | | | | 41,334 | | | | | | * | | | | | | 41,334 | | | | | | * | | | | | | 41,334 | | | | | | * | | |
All pre-Merger directors and executive officers of Quantum as a group (7 individuals) | | | | | 286,732 | | | | | | 1.1 | | | | | | 286,732 | | | | | | * | | | | | | 286,732 | | | | | | * | | |
Directors and Executive Officers of TradeStation Post-Merger(4) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
John Bartleman | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Takashi Oyagi | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Marc Stone | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Greg Vance | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Peter Korotkiy | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Michael Fisch | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Oki Matsumoto | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Jun Makihara | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Denise Dickins | | | | | ��� | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Ellen Ellison | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
George W. Wellde, Jr. | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
John Schaible | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | |
Sandip I. Patel(3) | | | | | 41,334 | | | | | | * | | | | | | 41,334 | | | | | | * | | | | | | 41,334 | | | | | | * | | |
All post-Merger directors and executive officers of TradeStation as a group (12 individuals) | | | | | — | | | | | | — | | | | | | 82,167 | | | | | | * | | | | | | 82,167 | | | | | | * | | |
Five Percent Holders: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Monex Group, Inc.(5) | | | | | — | | | | | | — | | | | | | 129,750,000 | | | | | | 77.9 | | | | | | 129,750,000 | | | | | | 89.1 | | |
Quantum Ventures LLC(6) | | | | | 3,796,335 | | | | | | 15.1 | | | | | | 2,621,802 | | | | | | 1.6 | | | | | | 2,621,802 | | | | | | 1.8 | | |
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| Unaudited Condensed Financial Statements as of March 31, 2022 and December 31, 2021 and for the three months ended March 31, 2022 and March 31, 2021: | | | ||||
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| | | December 31, 2021 (Restated) | | | December 31, 2020 | | ||||||
ASSETS | | | | | | | | | | | | | |
Current assets | | | | | | | | | | | | | |
Cash | | | | $ | 63,179 | | | | | $ | 21,868 | | |
Prepaid expenses | | | | | 339,450 | | | | | | 20,833 | | |
Total Current Assets | | | | | 402,629 | | | | | | 42,701 | | |
Deferred offering costs | | | | | — | | | | | | 157,919 | | |
Marketable securities held in Trust Account | | | | | 201,308,628 | | | | | | — | | |
TOTAL ASSETS | | | | $ | 201,711,257 | | | | | $ | 200,620 | | |
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY | | | | | | | | | | | | | |
Current liabilities | | | | | | | | | | | | | |
Accounts payable and accrued expenses | | | | $ | 2,642,531 | | | | | $ | 940 | | |
PIPE derivative liability | | | | | 4,566,000 | | | | | | — | | |
Accrued offering costs | | | | | — | | | | | | 50,000 | | |
Promissory note – related party | | | | | — | | | | | | 130,100 | | |
Total Current Liabilities | | | | | 7,208,531 | | | | | | 181,040 | | |
Warrant liabilities | | | | | 7,137,930 | | | | | | — | | |
Total Liabilities | | | | | 14,346,461 | | | | | | 181,040 | | |
Commitments and Contingencies | | | | | | | | | | | | | |
Common stock subject to possible redemption; 20,125,000 and no shares at redemption value at December 31, 2021 and 2020, respectively | | | | | 201,250,000 | | | | | | — | | |
Stockholders’ (Deficit) Equity | | | | | | | | | | | | | |
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued or outstanding | | | | | — | | | | | | — | | |
Common stock, $0.0001 par value; 100,000,000 shares authorized; 5,031,250 shares issued and outstanding (excluding 20,125,000 and no shares subject to possible redemption) at December 31, 2021 and 2020, respectively | | | | | 503 | | | | | | 503 | | |
Additional paid-in capital | | | | | — | | | | | | 24,497 | | |
Accumulated deficit | | | | | (13,885,707) | | | | | | (5,420) | | |
Total Stockholders’ (Deficit) Equity | | | | | (13,885,204) | | | | | | 19,580 | | |
TOTAL LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY | | | | $ | 201,711,257 | | | | | $ | 200,620 | | |
| | | Year Ended December 31, 2021 (Restated) | | | For the Period from October 1, 2020 (inception) through December 31, 2020 | | ||||||
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Operating and formation costs | | | | $ | 3,404,429 | | | | | $ | 5,420 | | |
Loss from operations | | | | | (3,404,429) | | | | | | (5,420) | | |
Other (expense) income: | | | | | | | | | | | | | |
Change in fair value of warrant liability | | | | | (3,322,992) | | | | | | — | | |
Change in fair value of PIPE derivative liability | | | | | 966,000 | | | | | | — | | |
Interest earned on marketable securities held in Trust Account | | | | | 56,233 | | | | | | — | | |
Unrealized gain on marketable securities held in Trust Account | | | | | 2,395 | | | | | | — | | |
Other expense, net | | | | | (2,298,364) | | | | | | — | | |
Net loss | | | | $ | (5,702,793) | | | | | $ | (5,420) | | |
Basic and diluted weighted average shares outstanding, Redeemable common stock | | | | | 17,897,945 | | | | | | — | | |
Basic and diluted net loss per share, Redeemable common stock | | | | $ | (0.25) | | | | | $ | — | | |
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | | | | | 4,959,332 | | | | | | 4,375,000 | | |
Basic and diluted net loss per share, Non-redeemable common stock | | | | $ | (0.25) | | | | | $ | (0.00) | | |
| | | Common Stock | | | Additional Paid-in Capital | | | Accumulated Deficit | | | Total Stockholders’ Equity (Deficit) | | ||||||||||||||||||
| | | Shares | | | Amount | | ||||||||||||||||||||||||
Balance – October 1, 2020 (Inception) | | | | | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
Issuance of common stock to Sponsor | | | | | 5,031,250 | | | | | | 503 | | | | | | 24,497 | | | | | | — | | | | | | 25,000 | | |
Net loss | | | | | — | | | | | | — | | | | | | — | | | | | | (5,420) | | | | | | (5,420) | | |
Balance – December 31, 2020 | | | | | 5,031,250 | | | | | | 503 | | | | | | 24,497 | | | | | | (5,420) | | | | | | 19,580 | | |
Accretion of Common Stock subject to Redemption | | | | | — | | | | | | — | | | | | | (8,500,809) | | | | | | (2,645,494) | | | | | | (11,146,303) | | |
Fair value of Public Warrants at issuance | | | | | — | | | | | | — | | | | | | 6,138,125 | | | | | | — | | | | | | 6,138,125 | | |
Cash paid in excess of fair value for Private Warrants | | | | | — | | | | | | — | | | | | | 2,338,187 | | | | | | — | | | | | | 2,338,187 | | |
Fair value of PIPE derivative liability at issuance (restated) | | | | | — | | | | | | — | | | | | | — | | | | | | (5,532,000) | | | | | | (5,532,000) | | |
Net loss (restated) | | | | | — | | | | | | — | | | | | | — | | | | | | (5,702,793) | | | | | | (5,702,793) | | |
Balance – December 31, 2021 (restated) | | | | | 5,031,250 | | | | | $ | 503 | | | | | $ | — | | | | | $ | (13,885,707) | | | | | $ | (13,885,204) | | |
| | | Year Ended December 31, 2021 (Restated) | | | For the Period from October 1, 2020 (inception) through December 31, 2020 | | ||||||
Cash Flows from Operating Activities: | | | | | | | | | | | | | |
Net loss | | | | $ | (5,702,793) | | | | | $ | (5,420) | | |
Adjustments to reconcile net loss to net cash used in operating activities: | | | | | | | | | | | | | |
Change in fair value of warrant liability | | | | | 3,322,992 | | | | | | — | | |
Change in fair value of PIPE derivative liability | | | | | (966,000) | | | | | | — | | |
Transaction costs incurred in connection with warrant liability | | | | | 9,348 | | | | | | — | | |
Unrealized gain on marketable securities held in Trust Account | | | | | (2,395) | | | | | | — | | |
Interest earned on marketable securities held in Trust Account | | | | | (56,233) | | | | | | — | | |
Changes in operating assets and liabilities: | | | | | | | | | | | | | |
Prepaid expenses | | | | | (318,617) | | | | | | (20,833) | | |
Accounts payable and accrued expenses | | | | | 2,641,591 | | | | | | 940 | | |
Net cash used in operating activities | | | | | (1,072,107) | | | | | | (25,313) | | |
Cash Flows from Investing Activities: | | | | | | | | | | | | | |
Investment of cash in Trust Account | | | | | (201,250,000) | | | | | | — | | |
Net cash used in investing activities | | | | | (201,250,000) | | | | | | — | | |
Cash Flows from Financing Activities: | | | | | | | | | | | | | |
Proceeds from issuance of common stock to Sponsor | | | | | — | | | | | | 25,000 | | |
Proceeds from sale of Units, net of underwriting discounts paid | | | | | 196,721,875 | | | | | | — | | |
Proceeds from promissory note – related party | | | | | 23,957 | | | | | | 130,100 | | |
Proceeds from sale of Private Placements Warrants | | | | | 6,153,125 | | | | | | — | | |
Repayment of promissory note – related party | | | | | (154,057) | | | | | | — | | |
Payment of offering costs | | | | | (381,482) | | | | | | (107,919) | | |
Net cash provided by financing activities | | | | | 202,363,418 | | | | | | 47,181 | | |
Net Change in Cash | | | | | 41,311 | | | | | | 21,868 | | |
Cash – Beginning | | | | | 21,868 | | | | | | — | | |
Cash – Ending | | | | $ | 63,179 | | | | | $ | 21,868 | | |
Supplemental disclosure of non-cash investing and financing activities: | | | | | | | | | | | | | |
Offering costs included in accrued offering costs | | | | $ | — | | | | | $ | 50,000 | | |
Initial classification of common stock subject to possible redemption | | | | $ | 201,250,000 | | | | | $ | — | | |
Initial classification of PIPE derivative liability | | | | $ | 5,532,000 | | | | | $ | — | | |
Initial classification of warrant liability | | | | $ | 3,814,938 | | | | | $ | — | | |
Accretion of common stock subject to possible redemption | | | | $ | 11,146,303 | | | | | $ | — | | |
| | | ($ in thousands) | | | | | | | | |||
Reclassification of investments held in Quantum Trust Account | | | | $ | 201,265 | | | | | | (i) | | |
Settlement of estimated transaction costs | | | | | (42,737) | | | | | | (ii) | | |
Proceeds from PIPE Investment – Third Party | | | | | 75,000 | | | | | | (iii) | | |
Proceeds from PIPE Investment – Monex | | | | | 50,000 | | | | | | (iv) | | |
| | | | $ | 283,528 | | | | | | | | |
| | | ($ in thousands) | | | | | | | | |||
Capitalize estimated transaction costs for TradeStation and Quantum | | | | $ | (36,426) | | | | | | (ii) | | |
Issuance of TradeStation Shares to PIPE Investors | | | | | 124,999 | | | | | | (iii)(iv) | | |
Reclassification of Public Shares subject to redemption | | | | | 201,248 | | | | | | (v) | | |
Elimination of Quantum accumulated deficit | | | | | (12,529) | | | | | | (vi) | | |
Pre-closing TradeStation reorganization | | | | | (1,298) | | | | | | (vii) | | |
Executive equity awards | | | | | 19,313 | | | | | | (viii) | | |
Par value adjustment | | | | | (363) | | | | | | (ix) | | |
| | | | $ | 294,944 | | | | | | | | |
| | | ($ in thousands) | | | | | | | | |||
Elimination of Quantum accumulated deficit | | | | $ | 12,529 | | | | | | (vi) | | |
Transaction cost allocated to the Earn Out Shares | | | | | (3,074) | | | | | | (ii) | | |
Quantum transaction cost | | | | $ | (2,530) | | | | | | (x) | | |
Monex Earn Out liability | | | | | (277,294) | | | | | | (D) | | |
Sponsor Earn Out liability | | | | | (7,740) | | | | | | (D) | | |
Executive equity awards | | | | | (19,323) | | | | | | (viii) | | |
| | | | $ | (297,432) | | | | | | | | |
| | | Year Ended March 31, 2022 | | |||||||||||||||
| | | No Redemption Scenario | | | 50% Redemption Scenario | | | Maximum Redemption Scenario | | |||||||||
| | | (dollars in thousands, except share and per share data) | | |||||||||||||||
Pro forma net loss | | | | $ | (58,763) | | | | | $ | (58,763) | | | | | $ | (58,763) | | |
Pro Forma weighted average shares calculation, basic and diluted | | | | | | | | | | | | | | | | | | | |
Public Shares and Sponsor Shares(1)(2) | | | | | 23,496,802 | | | | | | 23,496,802 | | | | | | 23,496,802 | | |
Quantum third-party PIPE shares(3)(4) | | | | | 8,250,000 | | | | | | 8,250,000 | | | | | | 8,250,000 | | |
TradeStation Stockholder(5) | | | | | 129,750,000 | | | | | | 129,750,000 | | | | | | 129,750,000 | | |
Monex PIPE shares | | | | | 5,000,000 | | | | | | 5,000,000 | | | | | | 5,000,000 | | |
Executive shares | | | | | 965,490 | | | | | | 965,490 | | | | | | 965,490 | | |
Redemptions | | | | | — | | | | | | (10,062,500) | | | | | | (20,875,000) | | |
Pro forma weighted average shares outstanding (basic) | | | | | 167,462,292 | | | | | | 157,399,792 | | | | | | 146,587,292 | | |
Net loss per share (basic) attributable to common stockholders | | | | $ | (0.35) | | | | | $ | (0.37) | | | | | $ | (0.40) | | |
Year ended March 31, 2021 pro forma weighted average shares outstanding (diluted)(6) | | | | | 167,462,292 | | | | | | 157,399,792 | | | | | | 146,587,292 | | |
Net loss per share (diluted) attributable to common stock holders | | | | $ | (0.35) | | | | | $ | (0.37) | | | | | $ | (0.40) | | |
Name | | | Age | | | Position | |
Executive Officers | | | | | | | |
John Bartleman | | | 50 | | | President; Chief Executive Officer; Chairman of the Board | |
Takashi Oyagi | | | 53 | | | Chief Strategic Officer; Director | |
Marc Stone | | | 61 | | | Chief Legal Officer; General Counsel; Secretary | |
Greg Vance | | | 53 | | | Chief Financial Officer | |
Peter Korotkiy | | | 53 | | | Chief Brokerage Officer | |
Michael Fisch | | | 49 | | | Chief Technology Officer | |
Directors | | | | | | | |
Oki Matsumoto | | | 58 | | | Director | |
Jun Makihara | | | 64 | | | Director | |
Denise Dickins | | | 60 | | | Director nominee | |
Ellen Ellison | | | 63 | | | Director nominee | |
George W. Wellde, Jr. | | | 69 | | | Director nominee | |
John Schaible | | | 51 | | | Director nominee | |
Sandip I. Patel | | | 55 | | | Director nominee | |
| | | Amount of Working Capital Loans(1) | | |||
John M. Schaible, Chairman and CEO | | | | $ | 21,244 | | |
Miguel Leon, CFO and Director | | | | $ | 45,526 | | |
Daniel Caamano V, President and Director | | | | $ | 49,722 | | |
Sandip Patel, Director(2) | | | | $ | 196,401 | | |
Thomas J. Hammond, Director | | | | $ | 0 | | |
Richard Korhammer, Director | | | | $ | 0 | | |
Steven J. Carlson, Director | | | | $ | 0 | | |
| | | TradeStation | | | Quantum | |
Authorized and Outstanding Capital Stock | | | The authorized capital stock of TradeStation consists of 750,000,000 TradeStation Shares and 25,000,000 shares of preferred stock, of which 1,000 TradeStation Shares and zero shares of preferred stock are outstanding. | | | The authorized capital stock of Quantum consists of 101,000,000 shares of capital stock, including 100,000,000 Quantum Shares and 1,000,000 shares of preferred stock, of which 25,156,250 Quantum Shares and zero shares of preferred stock are issued and outstanding. | |
Special Meetings of Stockholders | | | Except as otherwise required by law and subject to the rights of the holders of any series of preferred shares of TradeStation, special meetings of the stockholders of TradeStation for any purpose or purposes may be called at any time only by or at the direction of the TradeStation Board or the chair of the TradeStation Board; provided, however, that at any time when Monex as beneficial stockholders own, in the aggregate, at least 50% of the total voting power of all then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, special meetings of the | | | Subject to the rights, if any, of the holders of any outstanding series of the preferred stock, and to the requirements of applicable law, special meetings of stockholders of Quantum may be called only by the chairman of the Quantum Board, the chief executive officer of Quantum, or the Quantum Board pursuant to a resolution adopted by a majority of the Quantum Board, and the ability of the stockholders of Quantum to call a special meeting is hereby specifically denied. Except as provided in the foregoing sentence, special meetings of stockholders of Quantum may not be called by another person or persons. | |
| | | TradeStation | | | Quantum | |
| | | stockholders of TradeStation for any purpose or purposes may also be called by or at the direction of the TradeStation Board or the chair of the TradeStation Board at the request of Monex. | | | | |
Action by Written Consent | | | At any time when Monex owns, in the aggregate, at least 50% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, any action required or permitted to be taken at any annual or special meeting of stockholders of TradeStation may be taken without a meeting, without prior notice and without a vote, only if a consent or consents, setting forth the action so taken, shall be signed (i) by or on behalf of Monex and (ii) by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted and shall be delivered to TradeStation in accordance with the applicable provisions of the FBCA. At any time when Monex owns, in the aggregate, less than 50% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, any action required or permitted to be taken by the stockholders of TradeStation must be effected at a duly called annual or special meeting of such holders and may not be effected by any consent of stockholders in lieu of a meeting. | | | Except as may be otherwise provided for or fixed pursuant to the Amended and Restated Certificate of Incorporation (including any preferred stock designation) relating to the rights of the holders of any outstanding series of Preferred Stock, subsequent to the consummation of the IPO, any action required or permitted to be taken by the stockholders of Quantum must be effected by a duly called annual or special meeting of such stockholders and may not be effected by written consent of the stockholders of Quantum. | |
Quorum | | | A majority of the shares entitled to vote, represented in person or by proxy, shall constitute a quorum at a meeting of stockholders of TradeStation. When a specified item of business is required to be voted on by a class or series of stock, a majority of the shares of such class or series shall constitute a quorum for the transaction of such item of business by that class or series. | | | Except as otherwise provided by applicable law, the Certificate of Incorporation or the By Laws of Quantum, the presence, in person or by proxy, at a stockholders meeting of the holders of shares of outstanding capital stock of the Corporation representing a majority of the voting power of all outstanding shares of capital stock of Quantum entitled to vote at such meeting shall constitute a quorum for the transaction of business at such | |
| | | TradeStation | | | Quantum | |
| | | | | | meeting, except that when specified business is to be voted on by a class or series of stock voting as a class, the holders of shares representing a majority of the voting power of the outstanding shares of such class or series shall constitute a quorum of such class or series for the transaction of such business. | |
Notice of Meetings | | | Except as provided under “Action by Written Consent” above, TradeStation shall notify stockholders of the date, time and place of each annual and special stockholders’ meeting no fewer than 10 or more than 60 days before the meeting date. | | | Written notice of each stockholders meeting stating the place, if any, date, and time of the meeting, and the means of remote communication, if any, by which stockholders and proxy holders may be deemed to be present in person and vote at such meeting, and the record date for determining the stockholders entitled to vote at the meeting, if such date is different from the record date for determining stockholders entitled to notice of the meeting, shall be given to each stockholder entitled to vote thereat as of the record date for determining the stockholders entitled to notice of the meeting, by Quantum not less than 10 nor more than 60 days before the date of the meeting unless otherwise required by the DGCL | |
Advance Notice Provisions | | | No equivalent provision. | | | Advance notice of stockholder nominations for the election of directors and of business to be brought by stockholders before any meeting of the stockholders of Quantum shall be given in the manner provided in the Bylaws of Quantum. | |
Bylaw Amendments | | | The TradeStation Board may make, repeal, alter, amend and rescind, in whole or in part, the Amended Bylaws without the assent or vote of TradeStation stockholders in any manner not inconsistent with the FBCA or other applicable law or the Amended Charter; provided that at any time when Monex owns, in the aggregate, less than 50% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, in addition to any vote of the holders of any class or series of capital stock of TradeStation required by the Amended Charter, the affirmative vote of the holders of at least | | | The Quantum Board shall have the power to adopt, amend, alter or repeal the By Laws. The affirmative vote of a majority of the Board shall be required to adopt, amend, alter or repeal the By Laws. The By Laws also may be adopted, amended, altered or repealed by the stockholders; provided, however, that in addition to any vote of the holders of any class or series of capital stock of the Corporation required by applicable law or the Certificate of Incorporation, the affirmative vote of the holders of at least a majority of the voting (except as otherwise provided in Section 8.7 of the By-Laws) power of all outstanding shares of capital stock of the | |
| | | TradeStation | | | Quantum | |
| | | 662∕3% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote thereon, voting together as a single class, shall be required in order for the stockholders of TradeStation to alter, amend, repeal or rescind, in whole or in part, any provision of the Amended Bylaws or to adopt any provision inconsistent herewith. | | | Corporation entitled to vote generally in the election of directors, voting together as a single class, shall be required for the stockholders to adopt, amend, alter or repeal the By Laws. | |
Charter Amendments | | | At any time when Monex owns, in the aggregate, less than 50% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, in addition to any greater or additional vote required by applicable law or the Amended Charter, the following provisions in the Amended Charter may be amended, altered, repealed or rescinded, in whole or in part, or any provision inconsistent therewith may be adopted, only by the affirmative vote of the holders of at least 662∕3% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote thereon, voting together as a single class: Article V, Article VI, Article VIII, Article XI and Article XII. | | | Quantum reserves the right at any time and from time to time to amend, alter, change or repeal any provision contained in Quantum’s Amended and Restated Certificate of Incorporation (including any preferred stock designation), and other provisions authorized by the laws of the State of Delaware at the time in force that may be added or inserted, in the manner now or hereafter prescribed by Quantum’s Amended and Restated Certificate and the DGCL. | |
Size of Board, Election of Directors | | | The number of directors shall be determined from time to time by resolution adopted by the TradeStation Board. The directors (other than those directors elected by holders of any series of preferred shares), voting separately as a series or together with one or more such series, as the case may be, shall be divided into three classes designated Class I, Class II, Class III. Each class shall consist, as nearly as possible, of one-third of the total number of such directors. Class I directors shall initially serve for a term expiring at the first annual meeting of stockholders following the date the TradeStation Shares are first publicly traded after the date of the Restated Articles (the “Listing Date”), Class II directors shall initially serve for a term expiring at the second annual meeting of stockholders following the Listing Date and Class III | | | Quantum’s Amended and Restated Certificate of Incorporation provides that the number of directors of Quantum, other than those who may be elected by the holders of one or more series of the preferred stock voting separately by class or series, shall be fixed from time to time exclusively by the Quantum Board pursuant to a resolution adopted by a majority of the Quantum Board. | |
| | | TradeStation | | | Quantum | |
| | | directors shall initially serve for a term expiring at the third annual meeting of stockholders following the Listing Date. At each annual meeting of stockholders commencing with the first annual meeting following the Listing Date, the directors of the class to be elected at each annual meeting shall be elected for a three-year term. If the total number of such directors is changed, any increase or decrease shall be apportioned among the classes so as to maintain the number of directors in each class as nearly equal as possible, and any such additional director of any class elected to fill a newly created directorship resulting from an increase in such class shall hold office for a term that shall coincide with the remaining term of that class, but in no case shall a decrease in the total number of directors remove or shorten the term of any incumbent director. Any such director shall hold office until the annual meeting at which his or her term expires and until his or her successor shall be elected and qualified, or his or her earlier death, resignation, retirement, disqualification or removal from office. The TradeStation Board may assign members of the TradeStation Board already in office to their respective class. | | | | |
Removal of Directors | | | Any or all of the directors, voting separately as a series or together with one or more other such series, may be removed from office at any time, with or without cause, by the affirmative vote of a majority in voting power of all outstanding share of stock of TradeStation entitled to vote thereon, voting together as a single class; provided, however, that at any time when Monex owns, in the aggregate, less than 50% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, any such director or all such directors may be removed only for cause and only upon the affirmative vote of the holders of at least 662∕3% of the total voting power of all then outstanding shares of stock of TradeStation entitles to vote thereon, voting together as a single class. | | | Any or all of the directors may be removed from office at any time, but only for cause and only by the affirmative vote of holders of a majority of the voting power of all then outstanding shares of capital stock of Quantum entitled to vote generally in the election of directors, voting together as a single class. | |
| | | TradeStation | | | Quantum | |
Board Vacancies and Newly Created Directorships | | | Any vacancy occurring in the TradeStation Board (whether by death, resignation, retirement, disqualification, removal or other cause) shall be filled by the affirmative vote of a majority of the directors then in office (other than directors elected by the holders of any series of preferred shares, voting separately as a series or together with one or more series, as the case may be), although less than a quorum, by a sole remaining director or by the stockholders; provided, however, that, subject to the rights granted to holders of one or more series of preferred shares then outstanding, at any time when Monex owns, in the aggregate, less than 50% of the total voting power of all then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, any newly-created directorship on the TradeStation Board that results from an increase in the number of directors and any vacancy occurring in the TradeStation Board shall be filled only by an affirmative vote of a majority of the directors then in office, although less than a quorum, or by a sole remaining director (and not by stockholders) (other than directors elected by the holders of any series of preferred shares, by voting separately as a series or together with one or more series, as the case may be). | | | Quantum’s articles provide that newly created directorships resulting from an increase in the number of directors and any vacancies on the Quantum Board resulting from death, resignation, retirement, disqualification, removal or other cause may be filled solely and exclusively by a majority vote of the remaining directors then in office, even if less than a quorum, or by a sole remaining director (and not by stockholders), and any director so chosen shall hold office for the remainder of the full term of the class of directors to which the new directorship was added or in which the vacancy occurred and until his or her successor has been elected and qualified, subject, however, to such director’s earlier death, resignation, retirement, disqualification or removal. | |
Corporate Opportunity | | | To the fullest extent permitted by law, TradeStation renounces any interest or expectancy in, or right to be offered an opportunity to participate in, any business opportunity which may be a corporate opportunity for an identified person and TradeStation or any of its affiliates, except as provided in Section (C) of Article VI of the Amended Charter. In the event that any identified person acquires knowledge of a potential transaction or other business opportunity which may be a corporate opportunity for itself, herself or himself and TradeStation or any of its affiliates, such identified person shall, to the fullest extent permitted by law, have no duty to communicate or offer such transaction or other business opportunity to | | | To the extent allowed by law, the doctrine of corporate opportunity, or any other analogous doctrine, shall not apply with respect to Quantum or any of its officers or directors, or any of their respective affiliates, in circumstances where the application of any such doctrine would conflict with any fiduciary duties or contractual obligations they may have as of the date of Quantum’s Amended and Restated Certificate of Incorporation or in the future, and Quantum renounces any expectancy that any of the directors or officers of Quantum will offer any such corporate opportunity of which he or she may become aware to Quantum, except, the doctrine of corporate opportunity shall apply with respect to | |
| | | TradeStation | | | Quantum | |
| | | TradeStation or any of its affiliates and, to the fullest extent permitted by law, shall not be liable to TradeStation or its stockholders or to any affiliate of TradeStation for breach of any fiduciary duty as a stockholder, director or officer of TradeStation solely by reason of the fact that such identified person pursues or acquires such corporate opportunity for itself, herself or himself, or offers or directs such corporate opportunity to another person or does not communicate information regarding such corporate opportunity to TradeStation. | | | any of the directors or officers of Quantum only with respect to a corporate opportunity that was offered to such person solely in his or her capacity as a director or officer of Quantum and (i) such opportunity is one Quantum is legally and contractually permitted to undertake and would otherwise be reasonable for Quantum to pursue and (ii) the director or officer is permitted to refer that opportunity to Quantum without violating any legal obligation. | |
Exclusive Forum | | | Unless TradeStation consents in writing to the selection of an alternative forum, the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of TradeStation, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of TradeStation to TradeStation or TradeStation’s stockholders, (iii) an action asserting a claim arising pursuant to any provision of the FBCA or (iv) any action asserting a claim governed by the internal affairs doctrine shall be a state or federal court located within the state of Florida, in all cases subject to the court’s having personal jurisdiction over the indispensable parties named as defendants. | | | Unless Quantum consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall be the sole and exclusive forum for any stockholder (including a beneficial owner) to bring (i) any derivative action or proceeding brought on behalf of Quantum, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee or agent of Quantum to Quantum or Quantum’s stockholders, or any claim for aiding and abetting any such alleged breach, (iii) any action asserting a claim against Quantum, its directors, officers or employees arising pursuant to any provision of the DGCL or Quantum’s Amended and Restated Certificate of Incorporation or Bylaws or (iv) any action asserting a claim against Quantum, its directors, officers or employees governed by the internal affairs doctrine, except for, as to each of (i) through (iv) above, any claim as to which the Court of Chancery determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, or for which the Court of Chancery does not have subject matter jurisdiction. This exclusive forum provision will not apply to suits brought to enforce any duty or | |
| | | TradeStation | | | Quantum | |
| | | | | | liability created by the Exchange Act, the Securities Act or any other claim for which the federal courts have exclusive jurisdiction. Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder and Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. As a result, the exclusive forum provision will not apply to suits brought to enforce any duty or liability created by the Exchange Act, the Securities Act or any other claim for which the federal courts have exclusive jurisdiction. | |
Limitation of Liability | | | A director of TradeStation shall not be personally liable to TradeStation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director’s duty of loyalty to TradeStation or its stockholders, taking into account Article VI of the Amended Charter in determining the director’s duty of loyalty, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 607.0834 of the FBCA, as the same exists or hereafter may be amended, (iv) for violation of a criminal law, unless the director had reasonable cause to believe the director’s conduct was lawful or had no reasonable cause to believe the director’s conduct was unlawful or (v) for any transaction from which the director derived an improper personal benefit. If the FBCA is amended or interpreted to authorize the further elimination or limitation of the liability of directors, then the liability of TradeStation’s directors shall be eliminated or limited to the full extent authorized by the FBCA, as so amended or interpreted. | | | A director of Quantum shall not be personally liable to Quantum or its stockholders for monetary damages for breach of fiduciary duty as a director, except to the extent such exemption from liability or limitation thereof is not permitted under the DGCL as the same exists or may hereafter be amended unless a director violated his or her duty of loyalty to Quantum or its stockholders, acted in bad faith, knowingly or intentionally violated the law, authorized unlawful payments of dividends, unlawful stock purchases or unlawful redemptions, or derived improper personal benefit from his or her actions as a director. Any amendment, modification or repeal of the foregoing sentence shall not adversely affect any right or protection of a director of Quantum hereunder in respect of any act or omission occurring prior to the time of such amendment, modification or repeal. | |
| | | TradeStation | | | Quantum | |
Indemnification and Contribution | | | TradeStation shall indemnify any person who was or is a party to any proceeding (other than an action by, or in the right of, TradeStation), by reason of the fact that he or she is or was a director or officer of TradeStation and may so indemnify any employee or agent of TradeStation or any person who was serving at the request of TradeStation as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise against liability incurred in connection with such proceeding, including any appeal thereof, if he or she acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, the best interests of TradeStation and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful. | | | To the fullest extent permitted by applicable law, Quantum shall indemnify, defend and hold harmless each person who is or was made a party or is threatened to be made a party to or is otherwise involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (a “proceeding”) by reason of the fact that he or she is or was a director or officer of Quantum or, while a director or officer of Quantum, is or was serving at the request of Quantum as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust, other enterprise or nonprofit entity, including service with respect to an employee benefit plan (an “indemnitee”), whether the basis of such proceeding is alleged action in an official capacity as a director, officer, employee or agent, or in any other capacity while serving as a director, officer, employee or agent, against all liability and loss suffered and expenses (including, without limitation, attorneys’ fees, judgments, fines, the Employee Retirement Income Security Act of 1974, excise taxes and penalties and amounts paid in settlement) reasonably incurred by such indemnitee in connection with such proceeding. Quantum shall to the fullest extent not prohibited by applicable law pay the expenses (including attorneys’ fees) incurred by an indemnitee in defending or otherwise participating in any proceeding in advance of its final disposition; provided, however, that, to the extent required by applicable law, such payment of expenses in advance of the final disposition of the proceeding shall be made only upon receipt of an undertaking, by or on behalf of the indemnitee, to repay all amounts so advanced if it shall ultimately be determined that the indemnitee is not entitled to be indemnified. | |
| | | | | | After the Merger | | ||||||||||||||||||||||||||||||
| | | Before the Merger | | | Assuming No Redemptions | | | Assuming Illustrative Maximum Redemptions | | |||||||||||||||||||||||||||
Name and Address of Beneficial Owner | | | Number of Quantum Shares | | | % | | | Number of TradeStation Shares | | | % | | | Number of TradeStation Shares | | | % | | ||||||||||||||||||
Directors and Executive Officers of Quantum Pre-Merger(1) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
John Schaible | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | |
Daniel Caamano, V(2) | | | | | 41,233 | | | | | | * | | | | | | 41,233 | | | | | | * | | | | | | 41,233 | | | | | | * | | |
Miguel Leon | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | |
Steven J. Carlson | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | |
Thomas J. Hammond | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | |
Richard Korhammer | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | |
Sandip I. Patel(3) | | | | | 41,334 | | | | | | * | | | | | | 41,334 | | | | | | * | | | | | | 41,334 | | | | | | * | | |
All pre-Merger directors and executive officers of Quantum as a group (7 individuals) | | | | | 286,732 | | | | | | 1.1 | | | | | | 286,732 | | | | | | * | | | | | | 286,732 | | | | | | * | | |
Directors and Executive Officers of TradeStation Post-Merger(4) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
John Bartleman | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Takashi Oyagi | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Marc Stone | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Greg Vance | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Peter Korotkiy | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Michael Fisch | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Oki Matsumoto | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Jun Makihara | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Denise Dickins | | | | | ��� | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Ellen Ellison | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
George W. Wellde, Jr. | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
John Schaible | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | |
Sandip I. Patel(3) | | | | | 41,334 | | | | | | * | | | | | | 41,334 | | | | | | * | | | | | | 41,334 | | | | | | * | | |
All post-Merger directors and executive officers of TradeStation as a group (12 individuals) | | | | | — | | | | | | — | | | | | | 82,167 | | | | | | * | | | | | | 82,167 | | | | | | * | | |
Five Percent Holders: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Monex Group, Inc.(5) | | | | | — | | | | | | — | | | | | | 129,750,000 | | | | | | 77.9 | | | | | | 129,750,000 | | | | | | 89.1 | | |
Quantum Ventures LLC(6) | | | | | 3,796,335 | | | | | | 15.1 | | | | | | 2,621,802 | | | | | | 1.6 | | | | | | 2,621,802 | | | | | | 1.8 | | |
| | | | ||
| Financial Statements as of December 31, 2021 and December 31, 2020 and for the fiscal years ended December 31, 2021 and December 31, 2020: | | | ||
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| Unaudited Condensed Financial Statements as of March 31, 2022 and December 31, 2021 and for the three months ended March 31, 2022 and March 31, 2021: | | | ||
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| | | | | F-55 | | | |
| Consolidated Financial Statements as of March 31, 2022 and 2021 and for the fiscal years ended March 31, 2022, 2021 and 2020: | | | | | | | |
| | | | | F-56 | | | |
| | | | | F-57 | | | |
| | | | | F-58 | | | |
| | | | | F-59 | | | |
| | | | | F-60 | | |
| | | December 31, 2021 (Restated) | | | December 31, 2020 | | ||||||
ASSETS | | | | | | | | | | | | | |
Current assets | | | | | | | | | | | | | |
Cash | | | | $ | 63,179 | | | | | $ | 21,868 | | |
Prepaid expenses | | | | | 339,450 | | | | | | 20,833 | | |
Total Current Assets | | | | | 402,629 | | | | | | 42,701 | | |
Deferred offering costs | | | | | — | | | | | | 157,919 | | |
Marketable securities held in Trust Account | | | | | 201,308,628 | | | | | | — | | |
TOTAL ASSETS | | | | $ | 201,711,257 | | | | | $ | 200,620 | | |
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY | | | | | | | | | | | | | |
Current liabilities | | | | | | | | | | | | | |
Accounts payable and accrued expenses | | | | $ | 2,642,531 | | | | | $ | 940 | | |
PIPE derivative liability | | | | | 4,566,000 | | | | | | — | | |
Accrued offering costs | | | | | — | | | | | | 50,000 | | |
Promissory note – related party | | | | | — | | | | | | 130,100 | | |
Total Current Liabilities | | | | | 7,208,531 | | | | | | 181,040 | | |
Warrant liabilities | | | | | 7,137,930 | | | | | | — | | |
Total Liabilities | | | | | 14,346,461 | | | | | | 181,040 | | |
Commitments and Contingencies | | | | | | | | | | | | | |
Common stock subject to possible redemption; 20,125,000 and no shares at redemption value at December 31, 2021 and 2020, respectively | | | | | 201,250,000 | | | | | | — | | |
Stockholders’ (Deficit) Equity | | | | | | | | | | | | | |
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued or outstanding | | | | | — | | | | | | — | | |
Common stock, $0.0001 par value; 100,000,000 shares authorized; 5,031,250 shares issued and outstanding (excluding 20,125,000 and no shares subject to possible redemption) at December 31, 2021 and 2020, respectively | | | | | 503 | | | | | | 503 | | |
Additional paid-in capital | | | | | — | | | | | | 24,497 | | |
Accumulated deficit | | | | | (13,885,707) | | | | | | (5,420) | | |
Total Stockholders’ (Deficit) Equity | | | | | (13,885,204) | | | | | | 19,580 | | |
TOTAL LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY | | | | $ | 201,711,257 | | | | | $ | 200,620 | | |
| | | Year Ended December 31, 2021 (Restated) | | | For the Period from October 1, 2020 (inception) through December 31, 2020 | | ||||||
| | ||||||||||||
Operating and formation costs | | | | $ | 3,404,429 | | | | | $ | 5,420 | | |
Loss from operations | | | | | (3,404,429) | | | | | | (5,420) | | |
Other (expense) income: | | | | | | | | | | | | | |
Change in fair value of warrant liability | | | | | (3,322,992) | | | | | | — | | |
Change in fair value of PIPE derivative liability | | | | | 966,000 | | | | | | — | | |
Interest earned on marketable securities held in Trust Account | | | | | 56,233 | | | | | | — | | |
Unrealized gain on marketable securities held in Trust Account | | | | | 2,395 | | | | | | — | | |
Other expense, net | | | | | (2,298,364) | | | | | | — | | |
Net loss | | | | $ | (5,702,793) | | | | | $ | (5,420) | | |
Basic and diluted weighted average shares outstanding, Redeemable common stock | | | | | 17,897,945 | | | | | | — | | |
Basic and diluted net loss per share, Redeemable common stock | | | | $ | (0.25) | | | | | $ | — | | |
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | | | | | 4,959,332 | | | | | | 4,375,000 | | |
Basic and diluted net loss per share, Non-redeemable common stock | | | | $ | (0.25) | | | | | $ | (0.00) | | |
| | | Common Stock | | | Additional Paid-in Capital | | | Accumulated Deficit | | | Total Stockholders’ Equity (Deficit) | | ||||||||||||||||||
| | | Shares | | | Amount | | ||||||||||||||||||||||||
Balance – October 1, 2020 (Inception) | | | | | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
Issuance of common stock to Sponsor | | | | | 5,031,250 | | | | | | 503 | | | | | | 24,497 | | | | | | — | | | | | | 25,000 | | |
Net loss | | | | | — | | | | | | — | | | | | | — | | | | | | (5,420) | | | | | | (5,420) | | |
Balance – December 31, 2020 | | | | | 5,031,250 | | | | | | 503 | | | | | | 24,497 | | | | | | (5,420) | | | | | | 19,580 | | |
Accretion of Common Stock subject to Redemption | | | | | — | | | | | | — | | | | | | (8,500,809) | | | | | | (2,645,494) | | | | | | (11,146,303) | | |
Fair value of Public Warrants at issuance | | | | | — | | | | | | — | | | | | | 6,138,125 | | | | | | — | | | | | | 6,138,125 | | |
Cash paid in excess of fair value for Private Warrants | | | | | — | | | | | | — | | | | | | 2,338,187 | | | | | | — | | | | | | 2,338,187 | | |
Fair value of PIPE derivative liability at issuance (restated) | | | | | — | | | | | | — | | | | | | — | | | | | | (5,532,000) | | | | | | (5,532,000) | | |
Net loss (restated) | | | | | — | | | | | | — | | | | | | — | | | | | | (5,702,793) | | | | | | (5,702,793) | | |
Balance – December 31, 2021 (restated) | | | | | 5,031,250 | | | | | $ | 503 | | | | | $ | — | | | | | $ | (13,885,707) | | | | | $ | (13,885,204) | | |
| | | ($ in thousands) | | | | | | | | |||
Reclassification of investments held in Quantum Trust Account | | | | $ | 201,265 | | | | | | (i) | | |
Settlement of estimated transaction costs | | | | | (42,737) | | | | | | (ii) | | |
Proceeds from PIPE Investment – Third Party | | | | | 75,000 | | | | | | (iii) | | |
Proceeds from PIPE Investment – Monex | | | | | 50,000 | | | | | | (iv) | | |
| | | | $ | 283,528 | | | | | | | | |
| | | ($ in thousands) | | | | | | | | |||
Capitalize estimated transaction costs for TradeStation and Quantum | | | | $ | (36,426) | | | | | | (ii) | | |
Issuance of TradeStation Shares to PIPE Investors | | | | | 124,999 | | | | | | (iii)(iv) | | |
Reclassification of Public Shares subject to redemption | | | | | 201,248 | | | | | | (v) | | |
Elimination of Quantum accumulated deficit | | | | | (12,529) | | | | | | (vi) | | |
Pre-closing TradeStation reorganization | | | | | (1,298) | | | | | | (vii) | | |
Executive equity awards | | | | | 19,313 | | | | | | (viii) | | |
Par value adjustment | | | | | (363) | | | | | | (ix) | | |
| | | | $ | 294,944 | | | | | | | | |
| | | ($ in thousands) | | | | | | | | |||
Elimination of Quantum accumulated deficit | | | | $ | 12,529 | | | | | | (vi) | | |
Transaction cost allocated to the Earn Out Shares | | | | | (3,074) | | | | | | (ii) | | |
Quantum transaction cost | | | | $ | (2,530) | | | | | | (x) | | |
Monex Earn Out liability | | | | | (277,294) | | | | | | (D) | | |
Sponsor Earn Out liability | | | | | (7,740) | | | | | | (D) | | |
Executive equity awards | | | | | (19,323) | | | | | | (viii) | | |
| | | | $ | (297,432) | | | | | | | | |
| | | Year Ended March 31, 2022 | | |||||||||||||||
| | | No Redemption Scenario | | | 50% Redemption Scenario | | | Maximum Redemption Scenario | | |||||||||
| | | (dollars in thousands, except share and per share data) | | |||||||||||||||
Pro forma net loss | | | | $ | (58,763) | | | | | $ | (58,763) | | | | | $ | (58,763) | | |
Pro Forma weighted average shares calculation, basic and diluted | | | | | | | | | | | | | | | | | | | |
Public Shares and Sponsor Shares(1)(2) | | | | | 23,496,802 | | | | | | 23,496,802 | | | | | | 23,496,802 | | |
Quantum third-party PIPE shares(3)(4) | | | | | 8,250,000 | | | | | | 8,250,000 | | | | | | 8,250,000 | | |
TradeStation Stockholder(5) | | | | | 129,750,000 | | | | | | 129,750,000 | | | | | | 129,750,000 | | |
Monex PIPE shares | | | | | 5,000,000 | | | | | | 5,000,000 | | | | | | 5,000,000 | | |
Executive shares | | | | | 965,490 | | | | | | 965,490 | | | | | | 965,490 | | |
Redemptions | | | | | — | | | | | | (10,062,500) | | | | | | (20,875,000) | | |
Pro forma weighted average shares outstanding (basic) | | | | | 167,462,292 | | | | | | 157,399,792 | | | | | | 146,587,292 | | |
Net loss per share (basic) attributable to common stockholders | | | | $ | (0.35) | | | | | $ | (0.37) | | | | | $ | (0.40) | | |
Year ended March 31, 2021 pro forma weighted average shares outstanding (diluted)(6) | | | | | 167,462,292 | | | | | | 157,399,792 | | | | | | 146,587,292 | | |
Net loss per share (diluted) attributable to common stock holders | | | | $ | (0.35) | | | | | $ | (0.37) | | | | | $ | (0.40) | | |
Name | | | Age | | | Position | |
Executive Officers | | | | | | | |
John Bartleman | | | 50 | | | President; Chief Executive Officer; Chairman of the Board | |
Takashi Oyagi | | | 53 | | | Chief Strategic Officer; Director | |
Marc Stone | | | 61 | | | Chief Legal Officer; General Counsel; Secretary | |
Greg Vance | | | 53 | | | Chief Financial Officer | |
Peter Korotkiy | | | 53 | | | Chief Brokerage Officer | |
Michael Fisch | | | 49 | | | Chief Technology Officer | |
Directors | | | | | | | |
Oki Matsumoto | | | 58 | | | Director | |
Jun Makihara | | | 64 | | | Director | |
Denise Dickins | | | 60 | | | Director nominee | |
Ellen Ellison | | | 63 | | | Director nominee | |
George W. Wellde, Jr. | | | 69 | | | Director nominee | |
John Schaible | | | 51 | | | Director nominee | |
Sandip I. Patel | | | 55 | | | Director nominee | |
| | | Amount of Working Capital Loans(1) | | |||
John M. Schaible, Chairman and CEO | | | | $ | 21,244 | | |
Miguel Leon, CFO and Director | | | | $ | 45,526 | | |
Daniel Caamano V, President and Director | | | | $ | 49,722 | | |
Sandip Patel, Director(2) | | | | $ | 196,401 | | |
Thomas J. Hammond, Director | | | | $ | 0 | | |
Richard Korhammer, Director | | | | $ | 0 | | |
Steven J. Carlson, Director | | | | $ | 0 | | |
| | | TradeStation | | | Quantum | |
Authorized and Outstanding Capital Stock | | | The authorized capital stock of TradeStation consists of 750,000,000 TradeStation Shares and 25,000,000 shares of preferred stock, of which 1,000 TradeStation Shares and zero shares of preferred stock are outstanding. | | | The authorized capital stock of Quantum consists of 101,000,000 shares of capital stock, including 100,000,000 Quantum Shares and 1,000,000 shares of preferred stock, of which 25,156,250 Quantum Shares and zero shares of preferred stock are issued and outstanding. | |
Special Meetings of Stockholders | | | Except as otherwise required by law and subject to the rights of the holders of any series of preferred shares of TradeStation, special meetings of the stockholders of TradeStation for any purpose or purposes may be called at any time only by or at the direction of the TradeStation Board or the chair of the TradeStation Board; provided, however, that at any time when Monex as beneficial stockholders own, in the aggregate, at least 50% of the total voting power of all then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, special meetings of the | | | Subject to the rights, if any, of the holders of any outstanding series of the preferred stock, and to the requirements of applicable law, special meetings of stockholders of Quantum may be called only by the chairman of the Quantum Board, the chief executive officer of Quantum, or the Quantum Board pursuant to a resolution adopted by a majority of the Quantum Board, and the ability of the stockholders of Quantum to call a special meeting is hereby specifically denied. Except as provided in the foregoing sentence, special meetings of stockholders of Quantum may not be called by another person or persons. | |
| | | TradeStation | | | Quantum | |
| | | stockholders of TradeStation for any purpose or purposes may also be called by or at the direction of the TradeStation Board or the chair of the TradeStation Board at the request of Monex. | | | | |
Action by Written Consent | | | At any time when Monex owns, in the aggregate, at least 50% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, any action required or permitted to be taken at any annual or special meeting of stockholders of TradeStation may be taken without a meeting, without prior notice and without a vote, only if a consent or consents, setting forth the action so taken, shall be signed (i) by or on behalf of Monex and (ii) by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted and shall be delivered to TradeStation in accordance with the applicable provisions of the FBCA. At any time when Monex owns, in the aggregate, less than 50% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, any action required or permitted to be taken by the stockholders of TradeStation must be effected at a duly called annual or special meeting of such holders and may not be effected by any consent of stockholders in lieu of a meeting. | | | Except as may be otherwise provided for or fixed pursuant to the Amended and Restated Certificate of Incorporation (including any preferred stock designation) relating to the rights of the holders of any outstanding series of Preferred Stock, subsequent to the consummation of the IPO, any action required or permitted to be taken by the stockholders of Quantum must be effected by a duly called annual or special meeting of such stockholders and may not be effected by written consent of the stockholders of Quantum. | |
Quorum | | | A majority of the shares entitled to vote, represented in person or by proxy, shall constitute a quorum at a meeting of stockholders of TradeStation. When a specified item of business is required to be voted on by a class or series of stock, a majority of the shares of such class or series shall constitute a quorum for the transaction of such item of business by that class or series. | | | Except as otherwise provided by applicable law, the Certificate of Incorporation or the By Laws of Quantum, the presence, in person or by proxy, at a stockholders meeting of the holders of shares of outstanding capital stock of the Corporation representing a majority of the voting power of all outstanding shares of capital stock of Quantum entitled to vote at such meeting shall constitute a quorum for the transaction of business at such | |
| | | TradeStation | | | Quantum | |
| | | | | | meeting, except that when specified business is to be voted on by a class or series of stock voting as a class, the holders of shares representing a majority of the voting power of the outstanding shares of such class or series shall constitute a quorum of such class or series for the transaction of such business. | |
Notice of Meetings | | | Except as provided under “Action by Written Consent” above, TradeStation shall notify stockholders of the date, time and place of each annual and special stockholders’ meeting no fewer than 10 or more than 60 days before the meeting date. | | | Written notice of each stockholders meeting stating the place, if any, date, and time of the meeting, and the means of remote communication, if any, by which stockholders and proxy holders may be deemed to be present in person and vote at such meeting, and the record date for determining the stockholders entitled to vote at the meeting, if such date is different from the record date for determining stockholders entitled to notice of the meeting, shall be given to each stockholder entitled to vote thereat as of the record date for determining the stockholders entitled to notice of the meeting, by Quantum not less than 10 nor more than 60 days before the date of the meeting unless otherwise required by the DGCL | |
Advance Notice Provisions | | | No equivalent provision. | | | Advance notice of stockholder nominations for the election of directors and of business to be brought by stockholders before any meeting of the stockholders of Quantum shall be given in the manner provided in the Bylaws of Quantum. | |
Bylaw Amendments | | | The TradeStation Board may make, repeal, alter, amend and rescind, in whole or in part, the Amended Bylaws without the assent or vote of TradeStation stockholders in any manner not inconsistent with the FBCA or other applicable law or the Amended Charter; provided that at any time when Monex owns, in the aggregate, less than 50% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, in addition to any vote of the holders of any class or series of capital stock of TradeStation required by the Amended Charter, the affirmative vote of the holders of at least | | | The Quantum Board shall have the power to adopt, amend, alter or repeal the By Laws. The affirmative vote of a majority of the Board shall be required to adopt, amend, alter or repeal the By Laws. The By Laws also may be adopted, amended, altered or repealed by the stockholders; provided, however, that in addition to any vote of the holders of any class or series of capital stock of the Corporation required by applicable law or the Certificate of Incorporation, the affirmative vote of the holders of at least a majority of the voting (except as otherwise provided in Section 8.7 of the By-Laws) power of all outstanding shares of capital stock of the | |
| | | TradeStation | | | Quantum | |
| | | 662∕3% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote thereon, voting together as a single class, shall be required in order for the stockholders of TradeStation to alter, amend, repeal or rescind, in whole or in part, any provision of the Amended Bylaws or to adopt any provision inconsistent herewith. | | | Corporation entitled to vote generally in the election of directors, voting together as a single class, shall be required for the stockholders to adopt, amend, alter or repeal the By Laws. | |
Charter Amendments | | | At any time when Monex owns, in the aggregate, less than 50% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, in addition to any greater or additional vote required by applicable law or the Amended Charter, the following provisions in the Amended Charter may be amended, altered, repealed or rescinded, in whole or in part, or any provision inconsistent therewith may be adopted, only by the affirmative vote of the holders of at least 662∕3% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote thereon, voting together as a single class: Article V, Article VI, Article VIII, Article XI and Article XII. | | | Quantum reserves the right at any time and from time to time to amend, alter, change or repeal any provision contained in Quantum’s Amended and Restated Certificate of Incorporation (including any preferred stock designation), and other provisions authorized by the laws of the State of Delaware at the time in force that may be added or inserted, in the manner now or hereafter prescribed by Quantum’s Amended and Restated Certificate and the DGCL. | |
Size of Board, Election of Directors | | | The number of directors shall be determined from time to time by resolution adopted by the TradeStation Board. The directors (other than those directors elected by holders of any series of preferred shares), voting separately as a series or together with one or more such series, as the case may be, shall be divided into three classes designated Class I, Class II, Class III. Each class shall consist, as nearly as possible, of one-third of the total number of such directors. Class I directors shall initially serve for a term expiring at the first annual meeting of stockholders following the date the TradeStation Shares are first publicly traded after the date of the Restated Articles (the “Listing Date”), Class II directors shall initially serve for a term expiring at the second annual meeting of stockholders following the Listing Date and Class III | | | Quantum’s Amended and Restated Certificate of Incorporation provides that the number of directors of Quantum, other than those who may be elected by the holders of one or more series of the preferred stock voting separately by class or series, shall be fixed from time to time exclusively by the Quantum Board pursuant to a resolution adopted by a majority of the Quantum Board. | |
| | | TradeStation | | | Quantum | |
| | | directors shall initially serve for a term expiring at the third annual meeting of stockholders following the Listing Date. At each annual meeting of stockholders commencing with the first annual meeting following the Listing Date, the directors of the class to be elected at each annual meeting shall be elected for a three-year term. If the total number of such directors is changed, any increase or decrease shall be apportioned among the classes so as to maintain the number of directors in each class as nearly equal as possible, and any such additional director of any class elected to fill a newly created directorship resulting from an increase in such class shall hold office for a term that shall coincide with the remaining term of that class, but in no case shall a decrease in the total number of directors remove or shorten the term of any incumbent director. Any such director shall hold office until the annual meeting at which his or her term expires and until his or her successor shall be elected and qualified, or his or her earlier death, resignation, retirement, disqualification or removal from office. The TradeStation Board may assign members of the TradeStation Board already in office to their respective class. | | | | |
Removal of Directors | | | Any or all of the directors, voting separately as a series or together with one or more other such series, may be removed from office at any time, with or without cause, by the affirmative vote of a majority in voting power of all outstanding share of stock of TradeStation entitled to vote thereon, voting together as a single class; provided, however, that at any time when Monex owns, in the aggregate, less than 50% of the total voting power of all the then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, any such director or all such directors may be removed only for cause and only upon the affirmative vote of the holders of at least 662∕3% of the total voting power of all then outstanding shares of stock of TradeStation entitles to vote thereon, voting together as a single class. | | | Any or all of the directors may be removed from office at any time, but only for cause and only by the affirmative vote of holders of a majority of the voting power of all then outstanding shares of capital stock of Quantum entitled to vote generally in the election of directors, voting together as a single class. | |
| | | TradeStation | | | Quantum | |
Board Vacancies and Newly Created Directorships | | | Any vacancy occurring in the TradeStation Board (whether by death, resignation, retirement, disqualification, removal or other cause) shall be filled by the affirmative vote of a majority of the directors then in office (other than directors elected by the holders of any series of preferred shares, voting separately as a series or together with one or more series, as the case may be), although less than a quorum, by a sole remaining director or by the stockholders; provided, however, that, subject to the rights granted to holders of one or more series of preferred shares then outstanding, at any time when Monex owns, in the aggregate, less than 50% of the total voting power of all then outstanding shares of stock of TradeStation entitled to vote generally in the election of directors, any newly-created directorship on the TradeStation Board that results from an increase in the number of directors and any vacancy occurring in the TradeStation Board shall be filled only by an affirmative vote of a majority of the directors then in office, although less than a quorum, or by a sole remaining director (and not by stockholders) (other than directors elected by the holders of any series of preferred shares, by voting separately as a series or together with one or more series, as the case may be). | | | Quantum’s articles provide that newly created directorships resulting from an increase in the number of directors and any vacancies on the Quantum Board resulting from death, resignation, retirement, disqualification, removal or other cause may be filled solely and exclusively by a majority vote of the remaining directors then in office, even if less than a quorum, or by a sole remaining director (and not by stockholders), and any director so chosen shall hold office for the remainder of the full term of the class of directors to which the new directorship was added or in which the vacancy occurred and until his or her successor has been elected and qualified, subject, however, to such director’s earlier death, resignation, retirement, disqualification or removal. | |
Corporate Opportunity | | | To the fullest extent permitted by law, TradeStation renounces any interest or expectancy in, or right to be offered an opportunity to participate in, any business opportunity which may be a corporate opportunity for an identified person and TradeStation or any of its affiliates, except as provided in Section (C) of Article VI of the Amended Charter. In the event that any identified person acquires knowledge of a potential transaction or other business opportunity which may be a corporate opportunity for itself, herself or himself and TradeStation or any of its affiliates, such identified person shall, to the fullest extent permitted by law, have no duty to communicate or offer such transaction or other business opportunity to | | | To the extent allowed by law, the doctrine of corporate opportunity, or any other analogous doctrine, shall not apply with respect to Quantum or any of its officers or directors, or any of their respective affiliates, in circumstances where the application of any such doctrine would conflict with any fiduciary duties or contractual obligations they may have as of the date of Quantum’s Amended and Restated Certificate of Incorporation or in the future, and Quantum renounces any expectancy that any of the directors or officers of Quantum will offer any such corporate opportunity of which he or she may become aware to Quantum, except, the doctrine of corporate opportunity shall apply with respect to | |
| | | TradeStation | | | Quantum | |
| | | TradeStation or any of its affiliates and, to the fullest extent permitted by law, shall not be liable to TradeStation or its stockholders or to any affiliate of TradeStation for breach of any fiduciary duty as a stockholder, director or officer of TradeStation solely by reason of the fact that such identified person pursues or acquires such corporate opportunity for itself, herself or himself, or offers or directs such corporate opportunity to another person or does not communicate information regarding such corporate opportunity to TradeStation. | | | any of the directors or officers of Quantum only with respect to a corporate opportunity that was offered to such person solely in his or her capacity as a director or officer of Quantum and (i) such opportunity is one Quantum is legally and contractually permitted to undertake and would otherwise be reasonable for Quantum to pursue and (ii) the director or officer is permitted to refer that opportunity to Quantum without violating any legal obligation. | |
Exclusive Forum | | | Unless TradeStation consents in writing to the selection of an alternative forum, the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of TradeStation, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of TradeStation to TradeStation or TradeStation’s stockholders, (iii) an action asserting a claim arising pursuant to any provision of the FBCA or (iv) any action asserting a claim governed by the internal affairs doctrine shall be a state or federal court located within the state of Florida, in all cases subject to the court’s having personal jurisdiction over the indispensable parties named as defendants. | | | Unless Quantum consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall be the sole and exclusive forum for any stockholder (including a beneficial owner) to bring (i) any derivative action or proceeding brought on behalf of Quantum, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee or agent of Quantum to Quantum or Quantum’s stockholders, or any claim for aiding and abetting any such alleged breach, (iii) any action asserting a claim against Quantum, its directors, officers or employees arising pursuant to any provision of the DGCL or Quantum’s Amended and Restated Certificate of Incorporation or Bylaws or (iv) any action asserting a claim against Quantum, its directors, officers or employees governed by the internal affairs doctrine, except for, as to each of (i) through (iv) above, any claim as to which the Court of Chancery determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, or for which the Court of Chancery does not have subject matter jurisdiction. This exclusive forum provision will not apply to suits brought to enforce any duty or | |
| | | TradeStation | | | Quantum | |
| | | | | | liability created by the Exchange Act, the Securities Act or any other claim for which the federal courts have exclusive jurisdiction. Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder and Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. As a result, the exclusive forum provision will not apply to suits brought to enforce any duty or liability created by the Exchange Act, the Securities Act or any other claim for which the federal courts have exclusive jurisdiction. | |
Limitation of Liability | | | A director of TradeStation shall not be personally liable to TradeStation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director’s duty of loyalty to TradeStation or its stockholders, taking into account Article VI of the Amended Charter in determining the director’s duty of loyalty, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 607.0834 of the FBCA, as the same exists or hereafter may be amended, (iv) for violation of a criminal law, unless the director had reasonable cause to believe the director’s conduct was lawful or had no reasonable cause to believe the director’s conduct was unlawful or (v) for any transaction from which the director derived an improper personal benefit. If the FBCA is amended or interpreted to authorize the further elimination or limitation of the liability of directors, then the liability of TradeStation’s directors shall be eliminated or limited to the full extent authorized by the FBCA, as so amended or interpreted. | | | A director of Quantum shall not be personally liable to Quantum or its stockholders for monetary damages for breach of fiduciary duty as a director, except to the extent such exemption from liability or limitation thereof is not permitted under the DGCL as the same exists or may hereafter be amended unless a director violated his or her duty of loyalty to Quantum or its stockholders, acted in bad faith, knowingly or intentionally violated the law, authorized unlawful payments of dividends, unlawful stock purchases or unlawful redemptions, or derived improper personal benefit from his or her actions as a director. Any amendment, modification or repeal of the foregoing sentence shall not adversely affect any right or protection of a director of Quantum hereunder in respect of any act or omission occurring prior to the time of such amendment, modification or repeal. | |
| | | TradeStation | | | Quantum | |
Indemnification and Contribution | | | TradeStation shall indemnify any person who was or is a party to any proceeding (other than an action by, or in the right of, TradeStation), by reason of the fact that he or she is or was a director or officer of TradeStation and may so indemnify any employee or agent of TradeStation or any person who was serving at the request of TradeStation as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise against liability incurred in connection with such proceeding, including any appeal thereof, if he or she acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, the best interests of TradeStation and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful. | | | To the fullest extent permitted by applicable law, Quantum shall indemnify, defend and hold harmless each person who is or was made a party or is threatened to be made a party to or is otherwise involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (a “proceeding”) by reason of the fact that he or she is or was a director or officer of Quantum or, while a director or officer of Quantum, is or was serving at the request of Quantum as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust, other enterprise or nonprofit entity, including service with respect to an employee benefit plan (an “indemnitee”), whether the basis of such proceeding is alleged action in an official capacity as a director, officer, employee or agent, or in any other capacity while serving as a director, officer, employee or agent, against all liability and loss suffered and expenses (including, without limitation, attorneys’ fees, judgments, fines, the Employee Retirement Income Security Act of 1974, excise taxes and penalties and amounts paid in settlement) reasonably incurred by such indemnitee in connection with such proceeding. Quantum shall to the fullest extent not prohibited by applicable law pay the expenses (including attorneys’ fees) incurred by an indemnitee in defending or otherwise participating in any proceeding in advance of its final disposition; provided, however, that, to the extent required by applicable law, such payment of expenses in advance of the final disposition of the proceeding shall be made only upon receipt of an undertaking, by or on behalf of the indemnitee, to repay all amounts so advanced if it shall ultimately be determined that the indemnitee is not entitled to be indemnified. | |
| | | | | | After the Merger | | ||||||||||||||||||||||||||||||
| | | Before the Merger | | | Assuming No Redemptions | | | Assuming Illustrative Maximum Redemptions | | |||||||||||||||||||||||||||
Name and Address of Beneficial Owner | | | Number of Quantum Shares | | | % | | | Number of TradeStation Shares | | | % | | | Number of TradeStation Shares | | | % | | ||||||||||||||||||
Directors and Executive Officers of Quantum Pre-Merger(1) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
John Schaible | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | |
Daniel Caamano, V(2) | | | | | 41,233 | | | | | | * | | | | | | 41,233 | | | | | | * | | | | | | 41,233 | | | | | | * | | |
Miguel Leon | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | |
Steven J. Carlson | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | |
Thomas J. Hammond | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | |
Richard Korhammer | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | |
Sandip I. Patel(3) | | | | | 41,334 | | | | | | * | | | | | | 41,334 | | | | | | * | | | | | | 41,334 | | | | | | * | | |
All pre-Merger directors and executive officers of Quantum as a group (7 individuals) | | | | | 286,732 | | | | | | 1.1 | | | | | | 286,732 | | | | | | * | | | | | | 286,732 | | | | | | * | | |
Directors and Executive Officers of TradeStation Post-Merger(4) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
John Bartleman | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Takashi Oyagi | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Marc Stone | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Greg Vance | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Peter Korotkiy | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Michael Fisch | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Oki Matsumoto | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Jun Makihara | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Denise Dickins | | | | | ��� | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Ellen Ellison | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
George W. Wellde, Jr. | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
John Schaible | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | | | | | 40,833 | | | | | | * | | |
Sandip I. Patel(3) | | | | | 41,334 | | | | | | * | | | | | | 41,334 | | | | | | * | | | | | | 41,334 | | | | | | * | | |
All post-Merger directors and executive officers of TradeStation as a group (12 individuals) | | | | | — | | | | | | — | | | | | | 82,167 | | | | | | * | | | | | | 82,167 | | | | | | * | | |
Five Percent Holders: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Monex Group, Inc.(5) | | | | | — | | | | | | — | | | | | | 129,750,000 | | | | | | 77.9 | | | | | | 129,750,000 | | | | | | 89.1 | | |
Quantum Ventures LLC(6) | | | | | 3,796,335 | | | | | | 15.1 | | | | | | 2,621,802 | | | | | | 1.6 | | | | | | 2,621,802 | | | | | | 1.8 | | |
| | | | ||
| Financial Statements as of December 31, 2021 and December 31, 2020 and for the fiscal years ended December 31, 2021 and December 31, 2020: | | | ||
| | | | ||
| | | | ||
| | | | ||
| | | | ||
| | | | ||
| Unaudited Condensed Financial Statements as of March 31, 2022 and December 31, 2021 and for the three months ended March 31, 2022 and March 31, 2021: | | | ||
| | | | ||
| | | | ||
| | | | ||
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| | | |
| | | | | F-55 | | | |
| Consolidated Financial Statements as of March 31, 2022 and 2021 and for the fiscal years ended March 31, 2022, 2021 and 2020: | | | | | | | |
| | | | | F-56 | | | |
| | | | | F-57 | | | |
| | | | | F-58 | | | |
| | | | | F-59 | | | |
| | | | | F-60 | | |
| | | December 31, 2021 (Restated) | | | December 31, 2020 | | ||||||
ASSETS | | | | | | | | | | | | | |
Current assets | | | | | | | | | | | | | |
Cash | | | | $ | 63,179 | | | | | $ | 21,868 | | |
Prepaid expenses | | | | | 339,450 | | | | | | 20,833 | | |
Total Current Assets | | | | | 402,629 | | | | | | 42,701 | | |
Deferred offering costs | | | | | — | | | | | | 157,919 | | |
Marketable securities held in Trust Account | | | | | 201,308,628 | | | | | | — | | |
TOTAL ASSETS | | | | $ | 201,711,257 | | | | | $ | 200,620 | | |
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY | | | | | | | | | | | | | |
Current liabilities | | | | | | | | | | | | | |
Accounts payable and accrued expenses | | | | $ | 2,642,531 | | | | | $ | 940 | | |
PIPE derivative liability | | | | | 4,566,000 | | | | | | — | | |
Accrued offering costs | | | | | — | | | | | | 50,000 | | |
Promissory note – related party | | | | | — | | | | | | 130,100 | | |
Total Current Liabilities | | | | | 7,208,531 | | | | | | 181,040 | | |
Warrant liabilities | | | | | 7,137,930 | | | | | | — | | |
Total Liabilities | | | | | 14,346,461 | | | | | | 181,040 | | |
Commitments and Contingencies | | | | | | | | | | | | | |
Common stock subject to possible redemption; 20,125,000 and no shares at redemption value at December 31, 2021 and 2020, respectively | | | | | 201,250,000 | | | | | | — | | |
Stockholders’ (Deficit) Equity | | | | | | | | | | | | | |
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued or outstanding | | | | | — | | | | | | — | | |
Common stock, $0.0001 par value; 100,000,000 shares authorized; 5,031,250 shares issued and outstanding (excluding 20,125,000 and no shares subject to possible redemption) at December 31, 2021 and 2020, respectively | | | | | 503 | | | | | | 503 | | |
Additional paid-in capital | | | | | — | | | | | | 24,497 | | |
Accumulated deficit | | | | | (13,885,707) | | | | | | (5,420) | | |
Total Stockholders’ (Deficit) Equity | | | | | (13,885,204) | | | | | | 19,580 | | |
TOTAL LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY | | | | $ | 201,711,257 | | | | | $ | 200,620 | | |
| | | Year Ended December 31, 2021 (Restated) | | | For the Period from October 1, 2020 (inception) through December 31, 2020 | | ||||||
| | ||||||||||||
Operating and formation costs | | | | $ | 3,404,429 | | | | | $ | 5,420 | | |
Loss from operations | | | | | (3,404,429) | | | | | | (5,420) | | |
Other (expense) income: | | | | | | | | | | | | | |
Change in fair value of warrant liability | | | | | (3,322,992) | | | | | | — | | |
Change in fair value of PIPE derivative liability | | | | | 966,000 | | | | | | — | | |
Interest earned on marketable securities held in Trust Account | | | | | 56,233 | | | | | | — | | |
Unrealized gain on marketable securities held in Trust Account | | | | | 2,395 | | | | | | — | | |
Other expense, net | | | | | (2,298,364) | | | | | | — | | |
Net loss | | | | $ | (5,702,793) | | | | | $ | (5,420) | | |
Basic and diluted weighted average shares outstanding, Redeemable common stock | | | | | 17,897,945 | | | | | | — | | |
Basic and diluted net loss per share, Redeemable common stock | | | | $ | (0.25) | | | | | $ | — | | |
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | | | | | 4,959,332 | | | | | | 4,375,000 | | |
Basic and diluted net loss per share, Non-redeemable common stock | | | | $ | (0.25) | | | | | $ | (0.00) | | |
| | | Common Stock | | | Additional Paid-in Capital | | | Accumulated Deficit | | | Total Stockholders’ Equity (Deficit) | | ||||||||||||||||||
| | | Shares | | | Amount | | ||||||||||||||||||||||||
Balance – October 1, 2020 (Inception) | | | | | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
Issuance of common stock to Sponsor | | | | | 5,031,250 | | | | | | 503 | | | | | | 24,497 | | | | | | — | | | | | | 25,000 | | |
Net loss | | | | | — | | | | | | — | | | | | | — | | | | | | (5,420) | | | | | | (5,420) | | |
Balance – December 31, 2020 | | | | | 5,031,250 | | | | | | 503 | | | | | | 24,497 | | | | | | (5,420) | | | | | | 19,580 | | |
Accretion of Common Stock subject to Redemption | | | | | — | | | | | | — | | | | | | (8,500,809) | | | | | | (2,645,494) | | | | | | (11,146,303) | | |
Fair value of Public Warrants at issuance | | | | | — | | | | | | — | | | | | | 6,138,125 | | | | | | — | | | | | | 6,138,125 | | |
Cash paid in excess of fair value for Private Warrants | | | | | — | | | | | | — | | | | | | 2,338,187 | | | | | | — | | | | | | 2,338,187 | | |
Fair value of PIPE derivative liability at issuance (restated) | | | | | — | | | | | | — | | | | | | — | | | | | | (5,532,000) | | | | | | (5,532,000) | | |
Net loss (restated) | | | | | — | | | | | | — | | | | | | — | | | | | | (5,702,793) | | | | | | (5,702,793) | | |
Balance – December 31, 2021 (restated) | | | | | 5,031,250 | | | | | $ | 503 | | | | | $ | — | | | | | $ | (13,885,707) | | | | | $ | (13,885,204) | | |
| | | Year Ended December 31, 2021 (Restated) | | | For the Period from October 1, 2020 (inception) through December 31, 2020 | | ||||||
Cash Flows from Operating Activities: | | | | | | | | | | | | | |
Net loss | | | | $ | (5,702,793) | | | | | $ | (5,420) | | |
Adjustments to reconcile net loss to net cash used in operating activities: | | | | | | | | | | | | | |
Change in fair value of warrant liability | | | | | 3,322,992 | | | | | | — | | |
Change in fair value of PIPE derivative liability | | | | | (966,000) | | | | | | — | | |
Transaction costs incurred in connection with warrant liability | | | | | 9,348 | | | | | | — | | |
Unrealized gain on marketable securities held in Trust Account | | | | | (2,395) | | | | | | — | | |
Interest earned on marketable securities held in Trust Account | | | | | (56,233) | | | | | | — | | |
Changes in operating assets and liabilities: | | | | | | | | | | | | | |
Prepaid expenses | | | | | (318,617) | | | | | | (20,833) | | |
Accounts payable and accrued expenses | | | | | 2,641,591 | | | | | | 940 | | |
Net cash used in operating activities | | | | | (1,072,107) | | | | | | (25,313) | | |
Cash Flows from Investing Activities: | | | | | | | | | | | | | |
Investment of cash in Trust Account | | | | | (201,250,000) | | | | | | — | | |
Net cash used in investing activities | | | | | (201,250,000) | | | | | | — | | |
Cash Flows from Financing Activities: | | | | | | | | | | | | | |
Proceeds from issuance of common stock to Sponsor | | | | | — | | | | | | 25,000 | | |
Proceeds from sale of Units, net of underwriting discounts paid | | | | | 196,721,875 | | | | | | — | | |
Proceeds from promissory note – related party | | | | | 23,957 | | | | | | 130,100 | | |
Proceeds from sale of Private Placements Warrants | | | | | 6,153,125 | | | | | | — | | |
Repayment of promissory note – related party | | | | | (154,057) | | | | | | — | | |
Payment of offering costs | | | | | (381,482) | | | | | | (107,919) | | |
Net cash provided by financing activities | | | | | 202,363,418 | | | | | | 47,181 | | |
Net Change in Cash | | | | | 41,311 | | | | | | 21,868 | | |
Cash – Beginning | | | | | 21,868 | | | | | | — | | |
Cash – Ending | | | | $ | 63,179 | | | | | $ | 21,868 | | |
Supplemental disclosure of non-cash investing and financing activities: | | | | | | | | | | | | | |
Offering costs included in accrued offering costs | | | | $ | — | | | | | $ | 50,000 | | |
Initial classification of common stock subject to possible redemption | | | | $ | 201,250,000 | | | | | $ | — | | |
Initial classification of PIPE derivative liability | | | | $ | 5,532,000 | | | | | $ | — | | |
Initial classification of warrant liability | | | | $ | 3,814,938 | | | | | $ | — | | |
Accretion of common stock subject to possible redemption | | | | $ | 11,146,303 | | | | | $ | — | | |
| Gross proceeds | | | | $ | 201,250,000 | | |
| Less: | | | | | | | |
| Proceeds allocated to Public Warrants | | | | $ | (6,138,125) | | |
| Common stock issuance costs | | | | | (5,008,178) | | |
| Plus: | | | | | | | |
| Accretion of carrying value to redemption value | | | | $ | 11,146,303 | | |
| Common stock subject to possible redemption | | | | $ | 201,250,000 | | |
| | | Year Ended December 31, 2021 | | | For the Period from October 1, 2020 (Inception) through December 31, 2020 | | ||||||||||||||||||
| | | Redeemable | | | Non-redeemable | | | Redeemable | | | Non-redeemable | | ||||||||||||
Basic and diluted net loss per share of common stock | | | | | | | | | | | | | | | | | | | | | | | | | |
Numerator: | | | | | | | | | | | | | | | | | | | | | | | | | |
Allocation of net loss | | | | $ | (4,465,461) | | | | | $ | (1,237,332) | | | | | $ | — | | | | | $ | (5,420) | | |
Denominator: | | | | | | | | | | | | | | | | | | | | | | | | | |
Basic and diluted weighted average shares outstanding | | | | | 17,897,945 | | | | | | 4,959,332 | | | | | | — | | | | | | 4,375,000 | | |
Basic and diluted net loss per share of common stock | | | | $ | (0.25) | | | | | $ | (0.25) | | | | | $ | — | | | | | $ | (0.00) | | |
| | | December 31, 2021 | | | December 31, 2020 | | ||||||
| | ||||||||||||
Deferred tax assets | | | | | | | | | | | | | |
Net operating loss carryforward | | | | $ | 32,650 | | | | | $ | 1,138 | | |
Unrealized gain on marketable securities | | | | | (2,743) | | | | | | — | | |
Start up costs | | | | | 567,905 | | | | | | — | | |
Total deferred tax assets | | | | | 597,812 | | | | | | 1,138 | | |
Valuation Allowance | | | | | (597,812) | | | | | | (1,138) | | |
Deferred tax assets (liability), net of allowance | | | | $ | — | | | | | $ | — | | |
| | | December 31, 2021 | | | December 31, 2020 | | ||||||
| | ||||||||||||
Federal | | | | | | | | | | | | | |
Current | | | | $ | — | | | | | $ | — | | |
Deferred | | | | | (596,674) | | | | | | (1,138) | | |
State and Local | | | | | | | | | | | | | |
Current | | | | | — | | | | | | — | | |
Deferred | | | | | — | | | | | | — | | |
Change in valuation allowance | | | | | 596,674 | | | | | | 1,138 | | |
Income tax provision | | | | $ | — | | | | | $ | — | | |
| | | December 31, 2021 | | | December 31, 2020 | | ||||||
Statutory federal income tax rate | | | | | 21.0% | | | | | | 21.0% | | |
Business combination expenses | | | | | (1.80)% | | | | | | (0.0)% | | |
Change in fair value of warrant liability | | | | | (12.24)% | | | | | | 0.0% | | |
Change in fair value of PIPE derivative liability | | | | | 3.56% | | | | | | 0.0% | | |
Transaction costs – warrants | | | | | (0.03)% | | | | | | 0.0% | | |
Valuation allowance | | | | | (10.48)% | | | | | | (21.00)% | | |
Income tax provision | | | | | 0.0% | | | | | | 0.0% | | |
Description | | | Level | | | December 31, 2021 | | ||||||
Assets: | | | | | | | | | | | | | |
Marketable securities held in Trust Account | | | | | 1 | | | | | $ | 201,308,628 | | |
Liabilities: | | | | | | | | | | | | | |
PIPE derivative liability – Additional Shares | | | | | 3 | | | | | $ | 4,566,000 | | |
Warrant liability – Private Warrants | | | | | 3 | | | | | $ | 7,137,930 | | |
Input | | | February 9, 2021 (Initial Measurement) and February 12, 2021 (over-allotment exercise) | | | December 31, 2021 | | ||||||
Market price of public shares | | | | $ | 9.39 | | | | | $ | 9.89 | | |
Risk-free rate | | | | | 0.54% | | | | | | 1.27% | | |
Dividend yield | | | | | 0.00% | | | | | | 0.00% | | |
Volatility | | | | | 14.1% | | | | | | 9.5% | | |
Exercise price | | | | $ | 11.50 | | | | | $ | 11.50 | | |
Effective expiration date | | | | | 6/20/26 | | | | | | 02/25/27 | | |
Input | | | November 4, 2021 (Initial Measurement) | | | December 31, 2021 | | ||||||
Market price of Public Shares as of measurement date | | | | $ | 9.96 | | | | | $ | 9.89 | | |
Risk-free rate | | | | | 0.14% | | | | | | 0.33% | | |
Dividend yield | | | | | 0.00% | | | | | | 0.00% | | |
Volatility | | | | | 17.0% | | | | | | 14.5% | | |
Term (in years) | | | | | 0.99 | | | | | | 0.84 | | |
| | | Private Placement | | | PIPE Derivative Liability | | ||||||
Fair value as of January 1, 2021 | | | | $ | — | | | | | $ | — | | |
Initial measurement on February 9, 2021 | | | | | 3,448,750 | | | | | | — | | |
Exercising of underwriters’ over-allotment on February 12, 2021 | | | | | 366,188 | | | | | | — | | |
Initial measurement on November 4, 2021 | | | | | — | | | | | | 5,532,000 | | |
Change in valuation inputs or other assumptions | | | | | 3,322,992 | | | | | | (966,000) | | |
Fair value as of December 31, 2021 | | | | $ | 7,137,930 | | | | | $ | 4,566,000 | | |
Balance Sheet as of December 31, 2021 | | | As Previously Reported | | | Adjustment | | | As Restated | | |||||||||
PIPE derivative liability | | | | $ | — | | | | | $ | 4,566,000 | | | | | $ | 4,566,000 | | |
Total Current Liabilities | | | | $ | 2,642,531 | | | | | $ | 4,566,000 | | | | | $ | 7,208,531 | | |
Total Liabilities | | | | $ | 9,780,461 | | | | | $ | 4,566,000 | | | | | $ | 14,346,461 | | |
Accumulated deficit | | | | $ | (9,319,707) | | | | | $ | (4,566,000) | | | | | $ | (13,885,707) | | |
Total Stockholders’ Deficit | | | | $ | (9,319,204) | | | | | $ | (4,566,000) | | | | | $ | (13,885,204) | | |
Statement of Operations for the Year Ended December 31, 2021 | | | As Previously Reported | | | Adjustment | | | As Restated | | |||||||||
Change in fair value of PIPE derivative liability | | | | $ | — | | | | | $ | 966,000 | | | | | $ | 966,000 | | |
Total other expenses, net | | | | $ | (3,264,364) | | | | | $ | 966,000 | | | | | $ | (2,298,364) | | |
Net loss | | | | $ | (6,668,793) | | | | | $ | 966,000 | | | | | $ | (5,702,793) | | |
Basic and diluted net loss per share, Redeemable common stock | | | | $ | (0.29) | | | | | $ | 0.04 | | | | | $ | (0.25) | | |
Basic and diluted net loss per share, Non-redeemable common stock | | | | $ | (0.29) | | | | | $ | 0.04 | | | | | $ | (0.25) | | |
Statement of Changes in Stockholders’ Equity (Deficit) for the Year Ended December 31, 2021 | | | As Previously Reported | | | Adjustment | | | As Restated | | |||||||||
Fair value of PIPE derivative liability at issuance | | | | $ | — | | | | | $ | (5,532,000) | | | | | $ | (5,532,000) | | |
Net loss | | | | $ | (6,668,793) | | | | | $ | 966,000 | | | | | $ | (5,702,793) | | |
Total Stockholders’ Deficit | | | | $ | (9,319,204) | | | | | $ | (4,566,000) | | | | | $ | (13,885,204) | | |
Statement of Cash Flows for the Year Ended December 31, 2021 | | | As Previously Reported | | | Adjustment | | | As Restated | | |||||||||
Non-Cash investing and financing activities: | | | | | | | | | | | | | | | | | | | |
Initial classification of PIPE derivative liability | | | | $ | — | | | | | $ | 5,532,000 | | | | | $ | 5,532,000 | | |
| | | March 31, 2022 (Unaudited) | | | December 31, 2021 | | ||||||
ASSETS | | | | | | | | | | | | | |
Current assets | | | | | | | | | | | | | |
Cash | | | | $ | 124,104 | | | | | $ | 63,179 | | |
Prepaid expenses | | | | | 260,492 | | | | | | 339,450 | | |
Total Current Assets | | | | | 384,596 | | | | | | 402,629 | | |
Marketable securities held in Trust Account | | | | | 201,265,127 | | | | | | 201,308,628 | | |
TOTAL ASSETS | | | | $ | 201,649,723 | | | | | $ | 201,711,257 | | |
LIABILITIES AND STOCKHOLDERS’ DEFICIT | | | | | | | | | | | | | |
Current liabilities | | | | | | | | | | | | | |
Accounts payable and accrued expenses | | | | $ | 3,006,791 | | | | | $ | 2,642,531 | | |
PIPE derivative liability | | | | | 3,200,000 | | | | | | 4,566,000 | | |
Promissory note – related party | | | | | 242,101 | | | | | | — | | |
Total Current Liabilities | | | | | 6,448,892 | | | | | | 7,208,531 | | |
Warrant liability | | | | | 6,479,088 | | | | | | 7,137,930 | | |
Total Liabilities | | | | | 12,927,980 | | | | | | 14,346,461 | | |
Commitments and Contingencies | | | | | | | | | | | | | |
Common stock subject to possible redemption; 20,125,000 shares at redemption value at March 31, 2022 and December 31, 2021 | | | | | 201,250,000 | | | | | | 201,250,000 | | |
Stockholders’ Deficit | | | | | | | | | | | | | |
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued or outstanding | | | | | — | | | | | | — | | |
Common stock, $0.0001 par value; 100,000,000 shares authorized; 5,031,250 shares issued and outstanding (excluding 20,125,000 shares subject to possible redemption) at March 31, 2022 and December 31, 2021 | | | | | 503 | | | | | | 503 | | |
Additional paid-in capital | | | | | — | | | | | | — | | |
Accumulated deficit | | | | | (12,528,760) | | | | | | (13,885,707) | | |
Total Stockholders’ Deficit | | | | | (12,528,257) | | | | | | (13,885,204) | | |
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT | | | | $ | 201,649,723 | | | | | $ | 201,711,257 | | |
| | | For the Three Months Ended March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
Operating and formation costs | | | | $ | 688,894 | | | | | $ | 237,523 | | |
Loss from operations | | | | | (688,894) | | | | | | (237,523) | | |
Other income: | | | | | | | | | | | | | |
Change in fair value of warrant liability | | | | | 658,842 | | | | | | 1,969,000 | | |
Change in fair value of PIPE derivative liability | | | | | 1,366,000 | | | | | | — | | |
Interest earned on marketable securities held in Trust Account | | | | | 20,999 | | | | | | — | | |
Unrealized gain on marketable securities held in Trust Account | | | | | — | | | | | | 10,785 | | |
Other income, net | | | | | 2,045,841 | | | | | | 1,979,785 | | |
Net income | | | | $ | 1,356,947 | | | | | $ | 1,742,262 | | |
Basic and diluted weighted average shares outstanding, Redeemable common stock | | | | | 20,125,000 | | | | | | 11,093,056 | | |
Basic and diluted net income per share, Redeemable common stock | | | | $ | 0.05 | | | | | $ | 0.11 | | |
Basic and diluted weighted average shares outstanding, Non-redeemable common stock | | | | | 5,031,250 | | | | | | 4,739,583 | | |
Basic and diluted net income per share, Non-redeemable common stock | | | | $ | 0.05 | | | | | $ | 0.11 | | |
| | | Common Stock | | | Additional Paid-in Capital | | | Accumulated Deficit | | | Total Stockholders’ Deficit | | ||||||||||||||||||
| Shares | | | Amount | | ||||||||||||||||||||||||||
Balance – January 1, 2022 | | | | | 5,031,250 | | | | | $ | 503 | | | | | $ | — | | | | | $ | (13,885,707) | | | | | $ | (13,885,204) | | |
Net income | | | | | — | | | | | | — | | | | | | — | | | | | | 1,356,947 | | | | | | 1,356,947 | | |
Balance – March 31, 2022 | | | | | 5,031,250 | | | | | $ | 503 | | | | | $ | — | | | | | $ | (12,528,760) | | | | | $ | (12,528,257) | | |
| | | Common Stock | | | Additional Paid-in Capital | | | Accumulated Deficit | | | Total Stockholders’ Equity (Deficit) | | ||||||||||||||||||
| | | Shares | | | Amount | | ||||||||||||||||||||||||
Balance – January 1, 2021 | | | | | 5,031,250 | | | | | | 503 | | | | | | 24,497 | | | | | | (5,420) | | | | | | 19,580 | | |
Accretion of Common Stock subject to Redemption | | | | | — | | | | | | — | | | | | | (8,500,809) | | | | | | (2,645,494) | | | | | | (11,146,303) | | |
Fair value of Public Warrants at issuance | | | | | — | | | | | | — | | | | | | 6,138,125 | | | | | | — | | | | | | 6,138,125 | | |
Cash paid in excess of fair value for Private Warrants | | | | | — | | | | | | — | | | | | | 2,338,187 | | | | | | — | | | | | | 2,338,187 | | |
Net income | | | | | — | | | | | | — | | | | | | — | | | | | | 1,742,262 | | | | | | 1,742,262 | | |
Balance – March 31, 2021 | | | | | 5,031,250 | | | | | $ | 503 | | | | | $ | — | | | | | $ | (908,652) | | | | | $ | (908,149) | | |
| | | For the Three Months Ended March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
Cash Flows from Operating Activities: | | | | | | | | | | | | | |
Net income | | | | $ | 1,356,947 | | | | | $ | 1,742,262 | | |
Adjustments to reconcile net income to net cash used in operating activities: | | | | | | | | | | | | | |
Change in fair value of warrant liability | | | | | (658,842) | | | | | | (1,969,000) | | |
Change in fair value of PIPE liability | | | | | (1,366,000) | | | | | | — | | |
Transaction costs incurred in connection with warrant liability | | | | | — | | | | | | 9,348 | | |
Unrealized gain on marketable securities held in Trust Account | | | | | — | | | | | | (10,785) | | |
Interest earned on marketable securities held in Trust Account | | | | | (20,999) | | | | | | — | | |
Changes in operating assets and liabilities: | | | | | | | | | | | | | |
Prepaid expenses | | | | | 78,958 | | | | | | (590,033) | | |
Accounts payable and accrued expenses | | | | | 364,260 | | | | | | 130,433 | | |
Net cash used in operating activities | | | | | (245,676) | | | | | | (687,775) | | |
Cash Flows from Investing Activities: | | | | | | | | | | | | | |
Investment of cash in Trust Account | | | | | — | | | | | | (201,250,000) | | |
Cash withdrawn from Trust Account to pay franchise and income taxes | | | | | 64,500 | | | | | | — | | |
Net cash provided by (used in) investing activities | | | | | 64,500 | | | | | | (201,250,000) | | |
Cash Flows from Financing Activities: | | | | | | | | | | | | | |
Proceeds from sale of Units, net of underwriting discounts paid | | | | | — | | | | | | 196,721,875 | | |
Proceeds from promissory note – related party | | | | | 242,101 | | | | | | 23,957 | | |
Proceeds from sale of Private Placements Warrants | | | | | — | | | | | | 6,153,125 | | |
Repayment of promissory note – related party | | | | | — | | | | | | (154,057) | | |
Payment of offering costs | | | | | — | | | | | | (361,032) | | |
Net cash provided by financing activities | | | | | 242,101 | | | | | | 202,383,868 | | |
Net Change in Cash | | | | | 60,925 | | | | | | 446,093 | | |
Cash – Beginning | | | | | 63,179 | | | | | | 21,868 | | |
Cash – Ending | | | | $ | 124,104 | | | | | $ | 467,961 | | |
Supplemental disclosure of non-cash investing and financing activities: | | | | | | | | | | | | | |
Offering costs included in accrued offering costs | | | | $ | — | | | | | $ | 20,450 | | |
Initial classification of common stock subject to possible redemption | | | | $ | — | | | | | $ | 201,250,000 | | |
Initial classification of warrant liability | | | | $ | — | | | | | $ | 3,814,938 | | |
Accretion of common stock subject to possible redemption | | | | $ | — | | | | | $ | 11,146,303 | | |
| Gross proceeds | | | | $ | 201,250,000 | | |
| Less: | | | | | | | |
| Proceeds allocated to Public Warrants | | | | $ | (6,138,125) | | |
| Common stock issuance costs | | | | | (5,008,178) | | |
| Plus: | | | | | | | |
| Accretion of carrying value to redemption value | | | | $ | 11,146,303 | | |
| Common stock subject to possible redemption | | | | $ | 201,250,000 | | |
| | | For the Three Months Ended March 31, 2022 | | | For the Three Months Ended March 31, 2021 | | ||||||||||||||||||
| | | Redeemable | | | Non-redeemable | | | Redeemable | | | Non-redeemable | | ||||||||||||
Basic and diluted net income per share of common stock | | | | | | | | | | | | | | | | | | | | | | | | | |
Numerator: | | | | | | | | | | | | | | | | | | | | | | | | | |
Allocation of net income | | | | $ | 1,085,558 | | | | | $ | 271,389 | | | | | $ | 1,220,707 | | | | | $ | 521,555 | | |
Denominator: | | | | | | | | | | | | | | | | | | | | | | | | | |
Basic and diluted weighted average shares outstanding | | | | | 20,125,000 | | | | | | 5,031,250 | | | | | | 11,093,056 | | | | | | 4,739,583 | | |
Basic and diluted net income per share of common stock | | | | $ | 0.05 | | | | | $ | 0.05 | | | | | $ | 0.11 | | | | | $ | 0.11 | | |
Description | | | Level | | | December 31, 2021 | | | March 31, 2022 | | |||||||||
Assets: | | | | | | | | | | | | | | | | | | | |
Marketable securities held in Trust Account | | | | | 1 | | | | | $ | 201,308,628 | | | | | $ | 201,265,127 | | |
Liabilities: | | | | | | | | | | | | | | | | | | | |
PIPE derivative liability – Additional Shares | | | | | 3 | | | | | $ | 4,566,000 | | | | | $ | 3,200,000 | | |
Warrant liability – Private Warrants | | | | | 3 | | | | | $ | 7,137,930 | | | | | $ | 6,479,088 | | |
Input | | | February 9, 2021 (Initial Measurement) and February 12, 2021 (over-allotment exercise) | | | December 31, 2021 | | | March 31, 2022 | |
Market price of public shares | | | $9.39 | | | $9.89 | | | $9.88 | |
Risk-free rate | | | 0.54% | | | 1.27% | | | 2.43% | |
Dividend yield | | | 0.00% | | | 0.00% | | | 0.00% | |
Volatility | | | 14.1% | | | 9.5% | | | 13.7% | |
Exercise price | | | $11.50 | | | $11.50 | | | $11.50 | |
Effective expiration date | | | 6/20/26 | | | 02/25/27 | | | 02/25/27 | |
Input | | | November 4, 2021 (Initial Measurement) | | | December 31, 2021 | | | March 31, 2022 | | |||||||||
Market price of Public Shares as of measurement date | | | | $ | 9.96 | | | | | $ | 9.89 | | | | | $ | 9.88 | | |
Risk-free rate | | | | | 0.14% | | | | | | 0.33% | | | | | | 1.16% | | |
Dividend yield | | | | | 0.00% | | | | | | 0.00% | | | | | | 0.00% | | |
Volatility | | | | | 17.0% | | | | | | 14.5% | | | | | | 12.0% | | |
Term (in years) | | | | | 0.99 | | | | | | 0.84 | | | | | | 0.59 | | |
| | | Private Placement | | | PIPE Derivative Liability | | ||||||
Fair value as of January 1, 2021 | | | | $ | — | | | | | $ | — | | |
Initial measurement on February 9, 2021 | | | | | 3,448,750 | | | | | | — | | |
Exercising of underwriters’ over-allotment on February 12, 2021 | | | | | 366,188 | | | | | | — | | |
Initial measurement on November 4, 2021 | | | | | — | | | | | | 5,532,000 | | |
Change in valuation inputs or other assumptions | | | | | 3,322,992 | | | | | | (966,000) | | |
Fair value as of December 31, 2021 | | | | | 7,137,930 | | | | | | 4,566,000 | | |
Change in valuation inputs or other assumptions | | | | | (658,842) | | | | | | (1,366,000) | | |
Fair value as of March 31, 2022 | | | | $ | 6,479,088 | | | | | $ | 3,200,000 | | |
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| | | | | |
| | March 31, | | | March 31, | | ||||||||||||||||||||
| | 2021 | | 2020 | | | 2022 | | 2021 | | ||||||||||||||||
ASSETS | | | | | | | | | | | | | | | | | | | | | | | ||||
Cash and cash equivalents | | | $ | 84,399 | | | | $ | 128,066 | | | | | $ | 227,364 | | | | $ | 84,399 | | | ||||
Cash and investments segregated under federal regulations and other | | | | 2,808,981 | | | | | 2,072,175 | | | | | | 2,773,092 | | | | | 2,808,981 | | | ||||
Receivables from brokers, dealers, clearing organizations and clearing agents | | | | 90,245 | | | | | 79,266 | | | | | | 71,585 | | | | | 90,245 | | | ||||
Securities borrowed | | | | 335,057 | | | | | 266,839 | | | | | | 670,936 | | | | | 335,057 | | | ||||
Receivables from brokerage customers, net (net of allowance for credit losses of $138 and $269) | | | | 219,839 | | | | | 56,023 | | | |||||||||||||||
Receivables from brokerage customers, net | | | | 152,577 | | | | | 219,839 | | | |||||||||||||||
Cryptocurrency assets | | | | 319,408 | | | | | 7,427 | | | | | | 372,031 | | | | | 319,408 | | | ||||
Stablecoin assets | | | | 1,050 | | | | | 100 | | | | | | 1,288 | | | | | 1,050 | | | ||||
Cryptocurrency assets loaned | | | | 8,156 | | | | | — | | | | | | 26,924 | | | | | 8,156 | | | ||||
Pledged stablecoin assets | | | | 94,750 | | | | | 7,000 | | | | | | 135,850 | | | | | 94,750 | | | ||||
Due from affiliated companies | | | | 1,630 | | | | | 2,162 | | | | | | 1,269 | | | | | 1,630 | | | ||||
Property and equipment, net | | | | 42,439 | | | | | 39,691 | | | | | | 51,627 | | | | | 42,439 | | | ||||
Goodwill and intangible assets, net | | | | 158,316 | | | | | 167,258 | | | | | | 149,374 | | | | | 158,316 | | | ||||
Right-of-use assets, net | | | | 16,073 | | | | | 8,496 | | | | | | 11,901 | | | | | 16,073 | | | ||||
Other assets | | | | 17,154 | | | | | 14,843 | | | | | | 44,659 | | | | | 17,154 | | | ||||
Total assets | | | $ | 4,197,497 | | | | $ | 2,849,346 | | | | | $ | 4,690,477 | | | | $ | 4,197,497 | | | ||||
LIABILITIES AND SHAREHOLDER’S EQUITY | | | | | | | | | | | | | | | | | | | | | | | ||||
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | ||||
Payables to brokers, dealers and clearing organizations | | | $ | 3,791 | | | | $ | 3,749 | | | | | $ | 3,494 | | | | $ | 3,791 | | | ||||
Securities loaned | | | | 531,818 | | | | | 289,205 | | | | | | 680,208 | | | | | 531,818 | | | ||||
Payables to brokerage customers | | | | 2,795,154 | | | | | 2,089,346 | | | | | | 2,907,860 | | | | | 2,795,154 | | | ||||
Cryptocurrency and stablecoin payables to customers | | | | 153,601 | | | | | 2,016 | | | | | | 340,018 | | | | | 153,601 | | | ||||
Cryptocurrency collateral received on cryptocurrency and stablecoin assets lending | | | | 189,386 | | | | | 9,724 | | | | | | 217,256 | | | | | 189,386 | | | ||||
Cash collateral received on cryptocurrency assets lending | | | | — | | | | | 11,900 | | | |||||||||||||||
Operating lease liabilities | | | | 18,342 | | | | | 10,741 | | | | | | 16,671 | | | | | 18,342 | | | ||||
Notes payable | | | | 203,000 | | | | | 174,000 | | | | | | 278,000 | | | | | 203,000 | | | ||||
Deferred income taxes, net | | | | 18,124 | | | | | 14,221 | | | | | | 7,959 | | | | | 18,124 | | | ||||
Other liabilities | | | | 40,546 | | | | | 23,401 | | | | | | 50,617 | | | | | 40,546 | | | ||||
Due to affiliated companies | | | | 413 | | | | | 1,511 | | | | | | 506 | | | | | 413 | | | ||||
Total liabilities | | | | 3,954,175 | | | | | 2,629,814 | | | | | | 4,502,589 | | | | | 3,954,175 | | | ||||
COMMITMENTS AND CONTINGENCIES (see Note 15) | | | | | | | | | | | | |||||||||||||||
COMMITMENTS AND CONTINGENCIES (Note 15) | | | | | | | | | | | | |||||||||||||||
Shareholder’s equity: | | | | | | | | | | | | | | | | | | | | | | | ||||
Preferred stock, $0.01 par value; 25,000,000 shares authorized, no shares issued and outstanding | | | | — | | | | | — | | | | | | — | | | | | — | | | ||||
Common stock, $0.01 par value; 200,000,000 shares authorized, 1,000 issued and outstanding | | | | — | | | | | — | | | | | | — | | | | | — | | | ||||
Additional paid-in capital | | | | 171,278 | | | | | 171,278 | | | | | | 171,278 | | | | | 171,278 | | | ||||
Retained earnings | | | | 72,044 | | | | | 48,254 | | | | | | 16,610 | | | | | 72,044 | | | ||||
Total shareholder’s equity | | | | 243,322 | | | | | 219,532 | | | | | | 187,888 | | | | | 243,322 | | | ||||
Total liabilities and shareholder’s equity | | | $ | 4,197,497 | | | | $ | 2,849,346 | | | | | $ | 4,690,477 | | | | $ | 4,197,497 | | |
| | Year Ended March 31, | | | Year Ended March 31, | | ||||||||||||||||||||||||||||||||
| | 2021 | | 2020 | | 2019 | | | 2022 | | 2021 | | 2020 | | ||||||||||||||||||||||||
Revenues: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
Trading-related revenue | | | $ | 170,046 | | | | $ | 113,231 | | | | $ | 105,610 | | | | | $ | 165,421 | | | | $ | 170,046 | | | | $ | 113,231 | | | ||||||
Subscription and other revenue | | | | 8,771 | | | | | 10,051 | | | | | 12,647 | | | | | | 2,854 | | | | | 8,771 | | | | | 10,051 | | | ||||||
Total non-interest income | | | | 178,817 | | | | | 123,282 | | | | | 118,257 | | | | | | 168,275 | | | | | 178,817 | | | | | 123,282 | | | ||||||
Interest income | | | | 43,131 | | | | | 68,131 | | | | | 67,593 | | | | | | 50,814 | | | | | 43,131 | | | | | 68,131 | | | ||||||
Interest expense | | | | (3,296) | | | | | (2,774) | | | | | (1,719) | | | | | | (9,470) | | | | | (3,296) | | | | | (2,774) | | | ||||||
Net interest income | | | | 39,835 | | | | | 65,357 | | | | | 65,874 | | | | | | 41,344 | | | | | 39,835 | | | | | 65,357 | | | ||||||
Total net revenues | | | | 218,652 | | | | | 188,639 | | | | | 184,131 | | | | | | 209,619 | | | | | 218,652 | | | | | 188,639 | | | ||||||
Expenses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
Employee compensation and benefits | | | | 74,297 | | | | | 69,066 | | | | | 65,157 | | | | | | 91,664 | | | | | 74,297 | | | | | 69,066 | | | ||||||
Cost of services provided | | | | 33,493 | | | | | 31,168 | | | | | 28,253 | | | | | | 35,345 | | | | | 33,493 | | | | | 31,168 | | | ||||||
Communications | | | | 14,191 | | | | | 12,488 | | | | | 9,980 | | | | | | 15,543 | | | | | 14,191 | | | | | 12,488 | | | ||||||
Marketing | | | | 17,395 | | | | | 11,049 | | | | | 11,415 | | | | | | 57,733 | | | | | 17,395 | | | | | 11,049 | | | ||||||
Professional services | | | | 6,321 | | | | | 4,679 | | | | | 5,284 | | | | | | 10,091 | | | | | 6,321 | | | | | 4,679 | | | ||||||
Occupancy and equipment | | | | 13,439 | | | | | 11,332 | | | | | 10,146 | | | | | | 16,740 | | | | | 13,439 | | | | | 11,332 | | | ||||||
Depreciation and amortization of property and equipment | | | | 10,130 | | | | | 9,947 | | | | | 9,114 | | | | | | 10,758 | | | | | 10,130 | | | | | 9,947 | | | ||||||
Amortization of intangibles | | | | 8,942 | | | | | 8,874 | | | | | 8,778 | | | | | | 8,942 | | | | | 8,942 | | | | | 8,874 | | | ||||||
Interest expense on borrowings | | | | 3,070 | | | | | 4,409 | | | | | 4,590 | | | | | | 3,260 | | | | | 3,070 | | | | | 4,409 | | | ||||||
Other expense (income) | | | | 4,741 | | | | | 13,186 | | | | | 6,601 | | | | | | (1,355) | | | | | 4,741 | | | | | 13,186 | | | ||||||
Total expenses | | | | 186,019 | | | | | 176,198 | | | | | 159,318 | | | | | | 248,721 | | | | | 186,019 | | | | | 176,198 | | | ||||||
Income before income taxes | | | | 32,633 | | | | | 12,441 | | | | | 24,813 | | | ||||||||||||||||||||||
Income tax expense | | | | 8,843 | | | | | 2,164 | | | | | 6,217 | | | ||||||||||||||||||||||
Net income | | | $ | 23,790 | | | | $ | 10,277 | | | | $ | 18,596 | | | ||||||||||||||||||||||
Net income per common share, basic and diluted | | | $ | 23,790 | | | | $ | 10,277 | | | | $ | 18,596 | | | ||||||||||||||||||||||
Income (loss) before income taxes | | | | (39,102) | | | | | 32,633 | | | | | 12,441 | | | ||||||||||||||||||||||
Income tax expense (benefit) | | | | (7,406) | | | | | 8,843 | | | | | 2,164 | | | ||||||||||||||||||||||
Net income (loss) | | | $ | (31,696) | | | | $ | 23,790 | | | | $ | 10,277 | | | ||||||||||||||||||||||
Net income (loss) per common share, basic and diluted | | | $ | (31,696) | | | | $ | 23,790 | | | | $ | 10,277 | | | ||||||||||||||||||||||
Weighted-average common shares outstanding, basic and diluted | | | | 1,000 | | | | | 1,000 | | | | | 1,000 | | | | | | 1,000 | | | | | 1,000 | | | | | 1,000 | | |
| | Preferred Stock | | | | Common stock | | | Additional paid-in capital | | Retained earnings | | Total | | | Preferred stock | | | | Common stock | | | Additional paid-in capital | | Retained earnings | | Total | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| | Shares | | Amount | | | | Shares | | Amount | | | Shares | | Amount | | | | Shares | | Amount | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of March 31, 2018 | | | | — | | | | $ | — | | | | | | | 1,000 | | | | $ | — | | | | $ | 171,278 | | | | $ | 19,381 | | | | $ | 190,659 | | | ||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2019 | | | | — | | | | $ | — | | | | | | | 1,000 | | | | $ | — | | | | $ | 171,278 | | | | $ | 37,977 | | | | $ | 209,255 | | | ||||||||||||||||||||||||||||||||||||||||||||||||||
Net income | | | | — | | | | | — | | | | | | | — | | | | | — | | | | | — | | | | | 18,596 | | | | | 18,596 | | | | | | — | | | | | — | | | | | | | — | | | | | — | | | | | — | | | | | 10,277 | | | | | 10,277 | | | ||||||||||||
Balance as of March 31, 2019 | | | | — | | | | | — | | | | | | | 1,000 | | | | | — | | | | | 171,278 | | | | | 37,977 | | | | | 209,255 | | | ||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2020 | | | | — | | | | | — | | | | | | | 1,000 | | | | | — | | | | | 171,278 | | | | | 48,254 | | | | | 219,532 | | | ||||||||||||||||||||||||||||||||||||||||||||||||||
Net income | | | | — | | | | | — | | | | | | | — | | | | | — | | | | | — | | | | | 10,277 | | | | | 10,277 | | | | | | — | | | | | — | | | | | | | — | | | | | — | | | | | — | | | | | 23,790 | | | | | 23,790 | | | ||||||||||||
Balance as of March 31, 2020 | | | | — | | | | | — | | | | | | | 1,000 | | | | | — | | | | | 171,278 | | | | | 48,254 | | | | | 219,532 | | | ||||||||||||||||||||||||||||||||||||||||||||||||||
Net income | | | | — | | | | | — | | | | | | | — | | | | | — | | | | | — | | | | | 23,790 | | | | | 23,790 | | | ||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of March 31, 2021 | | | | — | | | | $ | — | | | | | | | 1,000 | | | | $ | — | | | | $ | 171,278 | | | | $ | 72,044 | | | | $ | 243,322 | | | ||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2021 | | | | — | | | | | — | | | | | | | 1,000 | | | | | — | | | | | 171,278 | | | | | 72,044 | | | | | 243,322 | | | ||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | | | | — | | | | | — | | | | | | | — | | | | | — | | | | | — | | | | | (31,696) | | | | | (31,696) | | | ||||||||||||||||||||||||||||||||||||||||||||||||||
Dividend paid to Parent Company | | | | — | | | | | — | | | | | | | — | | | | | — | | | | | — | | | | | (23,738) | | | | | (23,738) | | | ||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2022 | | | | — | | | | $ | — | | | | | | | 1,000 | | | | $ | — | | | | $ | 171,278 | | | | $ | 16,610 | | | | $ | 187,888 | | |
| | Year Ended March 31, | | | Year Ended March 31, | | ||||||||||||||||||||||||||||||||
| | 2021 | | 2020 | | 2019 | | | 2022 | | 2021 | | 2020 | | ||||||||||||||||||||||||
Cash flows from operating activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
Net income | | | $ | 23,790 | | | | $ | 10,277 | | | | $ | 18,596 | | | ||||||||||||||||||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | | | | | | | | | | | | | | | | | ||||||||||||||||||||||
Deferred tax expense | | | | 3,903 | | | | | 2,041 | | | | | 6,182 | | | ||||||||||||||||||||||
Net income (loss) | | | $ | (31,696) | | | | $ | 23,790 | | | | $ | 10,277 | | | ||||||||||||||||||||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | | | | | | | | | | | | | | | | | ||||||||||||||||||||||
Deferred tax expense (benefit) | | | | (10,160) | | | | | 3,903 | | | | | 2,041 | | | ||||||||||||||||||||||
Depreciation and amortization | | | | 19,072 | | | | | 18,821 | | | | | 17,892 | | | | | | 19,700 | | | | | 19,072 | | | | | 18,821 | | | ||||||
Gain on investment | | | | (8,146) | | | | | | | | | | | | | ||||||||||||||||||||||
Loss on disposal of property and equipment | | | | 157 | | | | | 1,996 | | | | | 588 | | | | | | 388 | | | | | 157 | | | | | 1,996 | | | ||||||
Impairment loss on cryptocurrency assets | | | | 25,334 | | | | | 13,614 | | | | | — | | | | | | — | | | | | 25,334 | | | | | 13,614 | | | ||||||
Gain on cryptocurrency assets | | | | (28,209) | | | | | (9,460) | | | | | — | | | | | | (83) | | | | | (28,209) | | | | | (9,460) | | | ||||||
Fair value adjustment on derivatives | | | | — | | | | | 63 | | | | | (7,067) | | | | | | — | | | | | — | | | | | 63 | | | ||||||
Gain on company-owned life insurance | | | | (1,841) | | | | | — | | | | | — | | | ||||||||||||||||||||||
Other, net | | | | — | | | | | (3) | | | | | (14) | | | | | | 1,461 | | | | | — | | | | | (3) | | | ||||||
Changes in operating assets and liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
Investments segregated under federal regulations and other | | | | 55,687 | | | | | 299,876 | | | | | 51,167 | | | | | | (37,641) | | | | | 55,687 | | | | | 299,876 | | | ||||||
Receivables from brokers, dealers, clearing organizations and clearing agents | | | | (10,980) | | | | | (14,659) | | | | | 26,781 | | | | | | 18,660 | | | | | (10,980) | | | | | (14,659) | | | ||||||
Securities borrowed | | | | (68,218) | | | | | 110,724 | | | | | (176,525) | | | | | | (335,879) | | | | | (68,218) | | | | | 110,724 | | | ||||||
Receivables from brokerage customers, net | | | | (163,816) | | | | | 30,221 | | | | | 8,734 | | | | | | 67,262 | | | | | (163,816) | | | | | 30,221 | | | ||||||
Stablecoins | | | | 13,602 | | | | | — | | | | | — | | | ||||||||||||||||||||||
Stablecoin assets, net of stablecoin payables to customers | | | | 141,832 | | | | | 13,602 | | | | | — | | | ||||||||||||||||||||||
Pledged stablecoin assets | | | | (87,750) | | | | | (7,000) | | | | | — | | | | | | (41,100) | | | | | (87,750) | | | | | (7,000) | | | ||||||
Cash collateral received on cryptocurrency assets lending | | | | (11,900) | | | | | 11,900 | | | | | — | | | | | | — | | | | | (11,900) | | | | | 11,900 | | | ||||||
Due from/to affiliated companies, net | | | | (565) | | | | | (1,616) | | | | | 1,437 | | | | | | 454 | | | | | (565) | | | | | (1,616) | | | ||||||
Other assets | | | | (2,361) | | | | | 3,786 | | | | | (1,841) | | | | | | (10,773) | | | | | (2,361) | | | | | 3,786 | | | ||||||
Payable to brokers, dealers and clearing organizations | | | | 227 | | | | | 772 | | | | | (326) | | | | | | (297) | | | | | 227 | | | | | 772 | | | ||||||
Securities loaned | | | | 242,613 | | | | | (24,743) | | | | | 153,024 | | | | | | 148,390 | | | | | 242,613 | | | | | (24,743) | | | ||||||
Payables to brokerage customers | | | | 705,808 | | | | | 21,980 | | | | | 41,176 | | | | | | 112,706 | | | | | 705,808 | | | | | 21,980 | | | ||||||
Other liabilities | | | | 16,322 | | | | | 5,800 | | | | | (1,950) | | | | | | 5,419 | | | | | 16,322 | | | | | 5,800 | | | ||||||
Net cash provided by operating activities | | | | 732,716 | | | | | 474,390 | | | | | 137,854 | | | | | | 38,656 | | | | | 732,716 | | | | | 474,390 | | | ||||||
Cash flows from investing activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
Purchase of property and equipment | | | | (2,884) | | | | | (2,982) | | | | | (1,441) | | | | | | (3,539) | | | | | (2,884) | | | | | (2,982) | | | ||||||
Capitalized internally developed software | | | | (9,130) | | | | | (9,318) | | | | | (9,174) | | | | | | (15,747) | | | | | (9,130) | | | | | (9,318) | | | ||||||
Cash paid in business acquisition, net of cash and cash equivalents acquired | | | | — | | | | | (1,500) | | | | | — | | | | | | — | | | | | — | | | | | (1,500) | | | ||||||
Other, net | | | | (874) | | | | | (1,200) | | | | | (117) | | | | | | (1,200) | | | | | (874) | | | | | (1,200) | | | ||||||
Net cash used in investing activities | | | | (12,888) | | | | | (15,000) | | | | | (10,732) | | | | | | (20,486) | | | | | (12,888) | | | | | (15,000) | | | ||||||
Cash flows from financing activities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
Proceeds from notes payable | | | | 97,000 | | | | | 54,000 | | | | | 32,000 | | | | | | 105,000 | | | | | 97,000 | | | | | 54,000 | | | ||||||
Repayment of notes payable | | | | (68,000) | | | | | (9,000) | | | | | (43,000) | | | | | | (30,000) | | | | | (68,000) | | | | | (9,000) | | | ||||||
Net cash provided by (used in) financing activities | | | | 29,000 | | | | | 45,000 | | | | | (11,000) | | | ||||||||||||||||||||||
Payment of dividend to Parent Company | | | | (23,738) | | | | | — | | | | | — | | | ||||||||||||||||||||||
Net cash provided by financing activities | | | | 51,262 | | | | | 29,000 | | | | | 45,000 | | | ||||||||||||||||||||||
Net increase in cash, cash equivalents and cash segregated | | | | 748,828 | | | | | 504,390 | | | | | 116,122 | | | | | | 69,432 | | | | | 748,828 | | | | | 504,390 | | | ||||||
Cash, cash equivalents and cash segregated at beginning of year | | | | 2,074,555 | | | | | 1,570,165 | | | | | 1,454,043 | | | ||||||||||||||||||||||
Cash, cash equivalents and cash segregated at end of year | | | $ | 2,823,383 | | | | $ | 2,074,555 | | | | $ | 1,570,165 | | | ||||||||||||||||||||||
Cash and cash equivalents at end of year | | | | 84,399 | | | | | 128,066 | | | | | 72,993 | | | ||||||||||||||||||||||
Cash segregated at end of year | | | | 2,738,984 | | | | | 1,946,489 | | | | | 1,497,172 | | | ||||||||||||||||||||||
Cash, cash equivalents and cash segregated at end of year | | | $ | 2,823,383 | | | | $ | 2,074,555 | | | | $ | 1,570,165 | | | ||||||||||||||||||||||
Cash, cash equivalents and cash segregated at beginning of period | | | | 2,823,383 | | | | | 2,074,555 | | | | | 1,570,165 | | | ||||||||||||||||||||||
Cash, cash equivalents and cash segregated at end of period | | | $ | 2,892,815 | | | | $ | 2,823,383 | | | | $ | 2,074,555 | | | ||||||||||||||||||||||
Cash and cash equivalents at end of period | | | $ | 227,364 | | | | $ | 84,399 | | | | $ | 128,066 | | | ||||||||||||||||||||||
Cash segregated at end of period | | | | 2,665,451 | | | | | 2,738,984 | | | | | 1,946,489 | | | ||||||||||||||||||||||
Cash, cash equivalents and cash segregated at end of period | | | $ | 2,892,815 | | | | $ | 2,823,383 | | | | $ | 2,074,555 | | | ||||||||||||||||||||||
Supplemental cash flow information and noncash activity: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
Cash paid for interest | | | $ | 7,326 | | | | $ | 7,863 | | | | $ | 5,892 | | | | | $ | 2,786 | | | | $ | 7,326 | | | | $ | 7,863 | | | ||||||
Cash paid for taxes | | | $ | 795 | | | | $ | 34 | | | | $ | 34 | | | | | $ | 4,977 | | | | $ | 795 | | | | $ | 34 | | | ||||||
Cash paid for leases | | | $ | 2,574 | | | | $ | 3,429 | | | | | — | | | | | $ | 2,373 | | | | $ | 2,574 | | | | $ | 3,429 | | | ||||||
Lease liabilities arising from obtaining right-of-use assets | | | $ | 10,270 | | | | $ | 14,055 | | | | | — | | | | | $ | 332 | | | | $ | 10,270 | | | | $ | 14,055 | | |
| | March 31, | | | March 31, | | ||||||||||||||||||||
| | 2021 | | 2020 | | | 2022 | | 2021 | | ||||||||||||||||
Deposits with clearing organizations | | | | 81,197 | | | | | 74,363 | | | | | $ | 61,850 | | | | $ | 81,197 | | | ||||
Receivables from order flow | | | | 5,557 | | | | | 3,215 | | | | | | 5,357 | | | | | 5,557 | | | ||||
Securities failed to deliver to broker-dealers | | | | 731 | | | | | 64 | | | | | | 346 | | | | | 731 | | | ||||
Other | | | | 2,760 | | | | | 1,624 | | | | | | 4,032 | | | | | 2,760 | | | ||||
| | | $ | 90,245 | | | | $ | 79,266 | | | | | $ | 71,585 | | | | $ | 90,245 | | |
| | March 31, | | | March 31, | | ||||||||||||||||||||
| | 2021 | | 2020 | | | 2022 | | 2021 | | ||||||||||||||||
Payables to clearing organizations | | | | 3,482 | | | | | 3,671 | | | | | $ | 3,476 | | | | $ | 3,482 | | | ||||
Payables to brokers-dealers | | | | 309 | | | | | 78 | | | | | | 18 | | | | | 309 | | | ||||
| | | $ | 3,791 | | | | $ | 3,749 | | | | | $ | 3,494 | | | | $ | 3,791 | | |
| | | Carrying value March 31, 2020 | | | Purchases | | | Net increase / decrease (1) | | | Impairment(2) | | | Net realized / unrealized gains (losses) (3) | | | Carrying value March 31, 2021 | | ||||||||||||||||||
Cryptocurrency assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Firm assets | | | | $ | 148 | | | | | $ | 250 | | | | | $ | (26) | | | | | $ | — | | | | | $ | 34 | | | | | $ | 406 | | |
Collateral assets | | | | | 5,942 | | | | | | — | | | | | | 110,604 | | | | | | (15,060) | | | | | | 87,900 | | | | | | 189,386 | | |
Customer assets | | | | | 1,337 | | | | | | — | | | | | | 112,034 | | | | | | (10,274) | | | | | | 26,519 | | | | | | 129,616 | | |
| | | | $ | 7,427 | | | | | $ | 250 | | | | | $ | 222,612 | | | | | $ | (25,334) | | | | | $ | 114,453 | | | | | $ | 319,408 | | |
Cryptocurrency assets loaned | | | | $ | — | | | | | $ | — | | | | | $ | 3,204 | | | | | $ | — | | | | | $ | 4,952 | | | | | $ | 8,156 | | |
| | | Carrying value March 31, 2019 | | | Purchases | | | Net increase / decrease (1) | | | Impairment(2) | | | Net realized / unrealized gains (losses) (3) | | | Carrying value March 31, 2020 | | ||||||||||||||||||
Cryptocurrency assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Firm assets | | | | $ | 39 | | | | | $ | 198 | | | | | $ | 2 | | | | | $ | (91) | | | | | $ | — | | | | | $ | 148 | | |
Collateral assets | | | | | — | | | | | | — | | | | | | 9,327 | | | | | | (12,844) | | | | | | 9,459 | | | | | | 5,942 | | |
Customer assets | | | | | — | | | | | | — | | | | | | 2,016 | | | | | | (679) | | | | | | — | | | | | | 1,337 | | |
| | | | $ | 39 | | | | | $ | 198 | | | | | $ | 11,345 | | | | | $ | (13,614) | | | | | $ | 9,459 | | | | | $ | 7,427 | | |
Cryptocurrency assets loaned | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
| | | Carrying Value March 31, 2021 | | | Purchases | | | Net increase/ decrease(1) | | | Impairment(2) | | | Net realized/ unrealized gains (losses)(3) | | | Carrying Value March 31, 2022 | | ||||||||||||||||||
Cryptocurrency assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Firm assets | | | | $ | 406 | | | | | $ | 991 | | | | | $ | (1,221) | | | | | $ | — | | | | | $ | 41 | | | | | $ | 217 | | |
Collateral assets | | | | | 189,386 | | | | | | — | | | | | | 66,711 | | | | | | — | | | | | | (38,841) | | | | | | 217,256 | | |
Customer assets | | | | | 129,616 | | | | | | — | | | | | | 42,802 | | | | | | — | | | | | | (17,860) | | | | | | 154,558 | | |
Total cryptocurrency assets | | | | $ | 319,408 | | | | | $ | 991 | | | | | $ | 108,292 | | | | | $ | — | | | | | $ | (56,580) | | | | | $ | 372,031 | | |
Cryptocurrency assets loaned | | | | $ | 8,156 | | | | | $ | — | | | | | $ | 16,380 | | | | | $ | — | | | | | $ | 2,388 | | | | | $ | 26,924 | | |
| | | Carrying Value March 31, 2020 | | | Purchases | | | Net increase/ decrease(1) | | | Impairment(2) | | | Net realized/ unrealized gains (losses)(3) | | | Carrying Value March 31, 2021 | | ||||||||||||||||||
Cryptocurrency assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Firm assets | | | | $ | 148 | | | | | $ | 250 | | | | | $ | (26) | | | | | $ | — | | | | | $ | 34 | | | | | $ | 406 | | |
Collateral assets | | | | | 5,942 | | | | | | — | | | | | | 110,604 | | | | | | (15,060) | | | | | | 87,900 | | | | | | 189,386 | | |
Customer assets | | | | | 1,337 | | | | | | — | | | | | | 112,034 | | | | | | (10,274) | | | | | | 26,519 | | | | | | 129,616 | | |
Total cryptocurrency assets | | | | $ | 7,427 | | | | | $ | 250 | | | | | $ | 222,612 | | | | | $ | (25,334) | | | | | $ | 114,453 | | | | | $ | 319,408 | | |
Cryptocurrency assets loaned | | | | $ | — | | | | | $ | — | | | | | $ | 3,204 | | | | | $ | — | | | | | $ | 4,952 | | | | | $ | 8,156 | | |
| | | March 31, 2022 | | | March 31, 2021 | | ||||||||||||||||||||||||||||||
| | | Notional (in units)(4) | | | Carrying Value | | | Fair Value | | | Notional (in units)(4) | | | Carrying Value | | | Fair Value | | ||||||||||||||||||
Cryptocurrency assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||
Firm assets(1) | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||
BTC | | | | | 4 | | | | | $ | 120 | | | | | $ | 166 | | | | | | 16 | | | | | $ | 116 | | | | | $ | 926 | | |
ETH | | | | | 12 | | | | | | 31 | | | | | | 40 | | | | | | 139 | | | | | | 238 | | | | | | 269 | | |
LTC | | | | | 503 | | | | | | 32 | | | | | | 63 | | | | | | 457 | | | | | | 17 | | | | | | 89 | | |
BCH | | | | | 109 | | | | | | 18 | | | | | | 42 | | | | | | 113 | | | | | | 19 | | | | | | 60 | | |
XRP | | | | | 95,133 | | | | | | 16 | | | | | | 77 | | | | | | 95,133 | | | | | | 16 | | | | | | 55 | | |
Total firm cryptocurrency assets | | | | | | | | | | | 217 | | | | | | 388 | | | | | | | | | | | | 406 | | | | | | 1,399 | | |
Collateral assets(2) | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||
BTC | | | | | 3,124 | | | | | | 142,867 | | | | | | 142,867 | | | | | | 3,159 | | | | | | 186,057 | | | | | | 186,057 | | |
ETH | | | | | 22,557 | | | | | | 74,389 | | | | | | 74,389 | | | | | | 1,715 | | | | | | 3,329 | | | | | | 3,329 | | |
Total collateral cryptocurrency assets | | | | | | | | | | | 217,256 | | | | | | 217,256 | | | | | | | | | | | | 189,386 | | | | | | 189,386 | | |
Customer assets(2) | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||
BTC | | | | | 1,346 | | | | | | 61,563 | | | | | | 61,563 | | | | | | 1,756 | | | | | | 103,431 | | | | | | 103,431 | | |
ETH | | | | | 26,118 | | | | | | 86,131 | | | | | | 86,131 | | | | | | 11,697 | | | | | | 22,710 | | | | | | 22,710 | | |
LTC | | | | | 42,347 | | | | | | 5,287 | | | | | | 5,287 | | | | | | 9,408 | | | | | | 1,841 | | | | | | 1,841 | | |
BCH | | | | | 1,697 | | | | | | 654 | | | | | | 654 | | | | | | 1,458 | | | | | | 781 | | | | | | 781 | | |
XRP(3) | | | | | 2,659,348 | | | | | | 923 | | | | | | 2,166 | | | | | | 3,726,713 | | | | | | 853 | | | | | | 2,139 | | |
Total customer cryptocurrency assets | | | | | | | | | | | 154,558 | | | | | | 155,801 | | | | | | | | | | | | 129,616 | | | | | | 130,902 | | |
Total cryptocurrency assets | | | | | | | | | | $ | 372,031 | | | | | $ | 373,445 | | | | | | | | | | | $ | 319,408 | | | | | $ | 321,687 | | |
Cryptocurrency assets loaned(2) | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||
BTC | | | | | 531 | | | | | $ | 24,285 | | | | | $ | 24,285 | | | | | | — | | | | | $ | — | | | | | $ | — | | |
ETH | | | | | 800 | | | | | | 2,639 | | | | | | 2,639 | | | | | | 4,000 | | | | | | 7,765 | | | | | | 7,765 | | |
LTC | | | | | — | | | | | | — | | | | | | — | | | | | | 2,000 | | | | | | 391 | | | | | | 391 | | |
Total cryptocurrency assets loaned | | | | | | | | | | $ | 26,924 | | | | | $ | 26,924 | | | | | | | | | | | $ | 8,156 | | | | | $ | 8,156 | | |
| | | | | | | March 31, | | | | | | | | March 31, | | ||||||||||||||||||||||
| | in years | | 2021 | | 2020 | | | in years | | 2022 | | 2021 | | ||||||||||||||||||||||||
Internally developed Software | | | | 7 | | | | $ | 61,743 | | | | $ | 53,238 | | | ||||||||||||||||||||||
Internally-developed Software | | | | 7 | | | | $ | 75,287 | | | | $ | 61,743 | | | ||||||||||||||||||||||
Software | | | | 3 – 5 | | | | | 15,949 | | | | | 15,275 | | | | | | 3 – 5 | | | | | 13,258 | | | | | 15,949 | | | ||||||
Computer equipment | | | | 3 – 5 | | | | | 26,526 | | | | | 24,423 | | | | | | 3 – 5 | | | | | 18,366 | | | | | 26,526 | | | ||||||
Furniture and equipment | | | | 3 – 7 | | | | | 2,371 | | | | | 4,163 | | | | | | 3 – 7 | | | | | 962 | | | | | 2,371 | | | ||||||
Leasehold improvements | | | | 5 – 10 | | | | | 4,981 | | | | | 4,969 | | | | | | 5 – 10 | | | | | 6,580 | | | | | 4,981 | | | ||||||
Construction-in-progress | | | | | | | | | 4,852 | | | | | 3,748 | | | | | | | | | | | 5,882 | | | | | 4,852 | | | ||||||
Total property and equipment | | | | | | | | | 116,422 | | | | | 105,816 | | | | | | | | | | | 120,335 | | | | | 116,422 | | | ||||||
Accumulated depreciation and amortization | | | | | | | | | (73,983) | | | | | (66,125) | | | | | | | | | | | (68,708) | | | | | (73,983) | | | ||||||
Total property and equipment, net | | | | | | | | $ | 42,439 | | | | $ | 39,691 | | | | | | | | | | $ | 51,627 | | | | $ | 42,439 | | |
| | | March 31, 2021 | | |||||||||||||||||||||||||||
| | | Weighted Average Original Useful Life (Years) | | | Weighted Average Remaining Useful Life (Years) | | | Gross Amount | | | Accumulated Amortization | | | Net Amount | | |||||||||||||||
Trademark | | | | | 17.19 | | | | | | 8.17 | | | | | $ | 17,520 | | | | | $ | 9,326 | | | | | $ | 8,194 | | |
Customer Lists | | | | | 17.5 | | | | | | 8.25 | | | | | | 36,000 | | | | | | 19,500 | | | | | | 16,500 | | |
Technology | | | | | 17.5 | | | | | | 8.25 | | | | | | 105,000 | | | | | | 56,875 | | | | | | 48,125 | | |
Educational Contents | | | | | 3 | | | | | | 1.42 | | | | | | 20 | | | | | | 11 | | | | | | 9 | | |
Non-compete Agreement | | | | | 3 | | | | | | 1.42 | | | | | | 250 | | | | | | 132 | | | | | | 118 | | |
| | | | | | | | | | | | | | | | $ | 158,790 | | | | | $ | 85,844 | | | | | $ | 72,946 | | |
| | | March 31, 2020 | | |||||||||||||||||||||||||||
| | | Weighted Average Original Useful Life (Years) | | | Weighted Average Remaining Useful Life (Years) | | | Gross Amount | | | Accumulated Amortization | | | Net Amount | | |||||||||||||||
Trademark | | | | | 17.19 | | | | | | 9.20 | | | | | $ | 17,520 | | | | | $ | 8,307 | | | | | $ | 9,213 | | |
Customer Lists | | | | | 17.5 | | | | | | 9.25 | | | | | | 36,000 | | | | | | 17,500 | | | | | | 18,500 | | |
Technology | | | | | 17.5 | | | | | | 9.25 | | | | | | 105,000 | | | | | | 51,042 | | | | | | 53,958 | | |
Educational Contents | | | | | 3 | | | | | | 1.83 | | | | | | 20 | | | | | | 4 | | | | | | 16 | | |
Non-compete Agreement | | | | | 3 | | | | | | 1.83 | | | | | | 250 | | | | | | 49 | | | | | | 201 | | |
| | | | | | | | | | | | | | | | $ | 158,790 | | | | | $ | 76,902 | | | | | $ | 81,888 | | |
| | | March 31, 2022 | | |||||||||||||||||||||||||||
| | | Weighted Average Original Useful Life (Years) | | | Weighted Average Remaining Useful Life (Years) | | | Gross Amount | | | Accumulated Amortization | | | Net Amount | | |||||||||||||||
Trademark | | | | | 17.19 | | | | | | 7.17 | | | | | $ | 17,520 | | | | | $ | 10,345 | | | | | $ | 7,175 | | |
Customer lists | | | | | 17.5 | | | | | | 7.25 | | | | | | 36,000 | | | | | | 21,500 | | | | | | 14,500 | | |
Technology | | | | | 17.5 | | | | | | 7.25 | | | | | | 105,000 | | | | | | 62,708 | | | | | | 42,292 | | |
Educational contents | | | | | 3 | | | | | | 0.42 | | | | | | 20 | | | | | | 17 | | | | | | 3 | | |
Non-compete agreement | | | | | 3 | | | | | | 0.42 | | | | | | 250 | | | | | | 215 | | | | | | 35 | | |
| | | | | | | | | | | | | | | | $ | 158,790 | | | | | $ | 94,785 | | | | | $ | 64,005 | | |
| | | March 31, 2021 | | |||||||||||||||||||||||||||
| | | Weighted Average Original Useful Life (Years) | | | Weighted Average Remaining Useful Life (Years) | | | Gross Amount | | | Accumulated Amortization | | | Net Amount | | |||||||||||||||
Trademark | | | | | 17.19 | | | | | | 8.17 | | | | | $ | 17,520 | | | | | $ | 9,326 | | | | | $ | 8,194 | | |
Customer lists | | | | | 17.5 | | | | | | 8.25 | | | | | | 36,000 | | | | | | 19,500 | | | | | | 16,500 | | |
Technology | | | | | 17.5 | | | | | | 8.25 | | | | | | 105,000 | | | | | | 56,875 | | | | | | 48,125 | | |
Educational contents | | | | | 3 | | | | | | 1.42 | | | | | | 20 | | | | | | 11 | | | | | | 9 | | |
Non-compete agreement | | | | | 3 | | | | | | 1.42 | | | | | | 250 | | | | | | 132 | | | | | | 118 | | |
| | | | �� | | | | | | | | | | | | $ | 158,790 | | | | | $ | 85,844 | | | | | $ | 72,946 | | |
Year Ended March 31, | | | | | | | | | | | | | ||
2022 | | | $ | 8,942 | | | ||||||||
2023 | | | | 8,890 | | | | | $ | 8,890 | | | ||
2024 | | | | 8,852 | | | | | | 8,852 | | | ||
2025 | | | | 8,852 | | | | | | 8,852 | | | ||
2026 | | | | 8,852 | | | | | | 8,852 | | | ||
2027 | | | | 8,809 | | | ||||||||
Thereafter | | | | 28,558 | | | | | | 19,750 | | | ||
Total future amortization expense | | | $ | 72,946 | | | | | $ | 64,005 | | |
| | | | | | | | | | | | | | | Hybrid Instruments | | | | | | | | |||||||||
| | | Cryptocurrency Type | | | Notional (in units)(1) | | | Not designated as hedges | | | Designated as hedges | | | Carrying Amount | | |||||||||||||||
Cryptocurrency | | | | | BTC | | | | | | 1,886 | | | | | $ | 50 | | | | | $ | 86,255 | | | | | $ | 86,305 | | |
payables to | | | | | ETH | | | | | | 26,929 | | | | | | 42 | | | | | | 88,805 | | | | | | 88,847 | | |
customers | | | | | LTC | | | | | | 42,611 | | | | | | 1 | | | | | | 5,320 | | | | | | 5,321 | | |
| | | | | BCH | | | | | | 1,692 | | | | | | — | | | | | | 652 | | | | | | 652 | | |
| | | | | XRP | | | | | | 2,659,348 | | | | | | — | | | | | | 2,166 | | | | | | 2,166 | | |
| | | | | | | | | | | | | | | | $ | 93 | | | | | $ | 183,198 | | | | | $ | 183,291 | | |
| | | | | | | | | | | | | | | Hybrid Instruments | | | | | | | | |||||||||
| | | Cryptocurrency Type | | | Notional (in units)(1) | | | Not designated as hedges | | | Designated as hedges | | | Carrying Amount | | |||||||||||||||
Cryptocurrency | | | | | BTC | | | | | | 3,124 | | | | | $ | — | | | | | $ | 142,867 | | | | | $ | 142,867 | | |
collateral received | | | | | ETH | | | | | | 22,557 | | | | | | — | | | | | | 74,389 | | | | | | 74,389 | | |
| | | | | | | | | | | | | | | | $ | — | | | | | $ | 217,256 | | | | | $ | 217,256 | | |
| | | | | | | | | | | | | | | Hybrid Instruments | | | | | | | | |||||||||
| | | Currency type | | | Notional (in Currency unit) | | | Not designated as hedges | | | Designated as hedges | | | Carrying Amount | | |||||||||||||||
Cryptocurrency payables to customers | | | | | BTC | | | | | | 1,752.59 | | | | | $ | — | | | | | $ | 103,221 | | | | | $ | 103,221 | | |
| | | | | ETH | | | | | | 15,750.91 | | | | | | — | | | | | | 30,579 | | | | | | 30,579 | | |
| | | | | LTC | | | | | | 11,462.16 | | | | | | — | | | | | | 2,244 | | | | | | 2,244 | | |
| | | | | BCH | | | | | | 1,328.83 | | | | | | — | | | | | | 710 | | | | | | 710 | | |
| | | | | XRP | | | | | | 3,726,713.16 | | | | | | — | | | | | | 2,139 | | | | | | 2,139 | | |
| | | | | | | | | | | | | | | | $ | — | | | | | $ | 138,893 | | | | | $ | 138,893 | | |
| | | | | | | | | | | | | | | Hybrid Instruments | | | | | | | | |||||||||
| | | Currency type | | | Notional (in Currency unit) | | | Not designated as hedges | | | Designated as hedges | | | Carrying Amount | | |||||||||||||||
Cryptocurrency collateral received | | | | | BTC | | | | | | 3,159.07 | | | | | $ | — | | | | | $ | 186,057 | | | | | $ | 186,057 | | |
| | | | | ETH | | | | | | 1,715.00 | | | | | | — | | | | | | 3,329 | | | | | | 3,329 | | |
| | | | | | | | | | | | | | | | $ | — | | | | | $ | 189,386 | | | | | $ | 189,386 | | |
| | | | | | | | | | | | | | | Hybrid Instruments | | | | | | | | |||||||||
| | | Cryptocurrency Type | | | Notional (in units)(1) | | | Not designated as hedges | | | Designated as hedges | | | Carrying Amount | | |||||||||||||||
Cryptocurrency | | | | | BTC | | | | | | 1,753 | | | | | $ | — | | | | | $ | 103,221 | | | | | $ | 103,221 | | |
payables to | | | | | ETH | | | | | | 15,751 | | | | | | — | | | | | | 30,579 | | | | | | 30,579 | | |
customers | | | | | LTC | | | | | | 11,462 | | | | | | — | | | | | | 2,244 | | | | | | 2,244 | | |
| | | | | BCH | | | | | | 1,329 | | | | | | — | | | | | | 710 | | | | | | 710 | | |
| | | | | XRP | | | | | | 3,726,713 | | | | | | — | | | | | | 2,139 | | | | | | 2,139 | | |
| | | | | | | | | | | | | | | | $ | — | | | | | $ | 138,893 | | | | | $ | 138,893 | | |
| | | | | | | | | | | | | | | Hybrid Instruments | | | | | | | | |||||||||
| | | Cryptocurrency Type | | | Notional (in units)(1) | | | Not designated as hedges | | | Designated as hedges | | | Carrying Amount | | |||||||||||||||
Cryptocurrency | | | | | BTC | | | | | | 3,159 | | | | | $ | — | | | | | $ | 186,057 | | | | | $ | 186,057 | | |
collateral received | | | | | ETH | | | | | | 1,715 | | | | | | — | | | | | | 3,329 | | | | | | 3,329 | | |
| | | | | | | | | | | | | | | | $ | — | | | | | $ | 189,386 | | | | | $ | 189,386 | | |
| | | | | | | | | | | | | | | Hybrid Instruments | | | | | | | | |||||||||
| | | Currency type | | | Notional (in Currency unit) | | | Not designated as hedges | | | Designated as hedges | | | Carrying Amount | | |||||||||||||||
Cryptocurrency payables to customers | | | | | BTC | | | | | | 1,725.22 | | | | | $ | 1,711 | | | | | $ | — | | | | | $ | 1,711 | | |
| | | | | ETH | | | | | | 626.74 | | | | | | 116 | | | | | | — | | | | | | 116 | | |
| | | | | LTC | | | | | | 590.63 | | | | | | 30 | | | | | | — | | | | | | 30 | | |
| | | | | BCH | | | | | | 101.81 | | | | | | 22 | | | | | | — | | | | | | 22 | | |
| | | | | XRP | | | | | | 586,870.91 | | | | | | 137 | | | | | | — | | | | | | 137 | | |
| | | | | | | | | | | | | | | | $ | 2,016 | | | | | $ | — | | | | | $ | 2,016 | | |
| | | | | | | | | | | | | | | Hybrid Instruments | | | | | | | | |||||||||
| | | Currency type | | | Notional (in Currency unit) | | | Not designated as hedges | | | Designated as hedges | | | Carrying Amount | | |||||||||||||||
Cryptocurrency collateral received | | | | | BTC | | | | | | 1,501.83 | | | | | $ | 9,724 | | | | | $ | — | | | | | $ | 9,724 | | |
| | Gains (losses) on: | | | Gains (losses) recorded in income: | | ||||||||||||||||||||||||||||||||
| | Hybrid instruments | | Hedged items | | Net impact | | | Hybrid instruments | | Hedged items | | Net impact | | ||||||||||||||||||||||||
| | | $ | (90,872) | | | | $ | 90,872 | | | | $ | — | | | | | $ | 54,355 | | | | $ | (54,313) | | | | $ | 42 | | |
| | | Gains (losses) recorded in income: | | |||||||||||||||
| | | Hybrid instruments | | | Hedged items | | | Net impact | | |||||||||
| | | | $ | (90,872) | | | | | $ | 90,872 | | | | | $ | — | | |
| | | March 31, 2021 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total Fair Value | | ||||||||||||
Assets: | | | | | | | | | | | | | | | | | | | | | | | | | |
Investments segregated under federal regulations and other U.S. Treasuries | | | | $ | 69,997 | | | | | $ | — | | | | | $ | — | | | | | $ | 69,997 | | |
Receivables from brokers, dealers, clearing organizations and clearing agents | | | | | | | | | | | | | | | | | | | | | | | | | |
U.S. Treasuries | | | | | 20,000 | | | | | | — | | | | | | — | | | | | | 20,000 | | |
Stablecoin assets | | | | | 1,050 | | | | | | — | | | | | | — | | | | | | 1,050 | | |
Pledged stablecoin assets | | | | | 94,750 | | | | | | — | | | | | | — | | | | | | 94,750 | | |
Other assets(1) | | | | | 1,766 | | | | | | — | | | | | | 866 | | | | | | 2,632 | | |
Total financial assets measured at fair value | | | | $ | 187,563 | | | | | $ | — | | | | | $ | 866 | | | | | $ | 188,429 | | |
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | |
Stablecoin payables to customers | | | | $ | 14,708 | | | | | $ | — | | | | | $ | — | | | | | $ | 14,708 | | |
Other liabilities | | | | | — | | | | | | 169 | | | | | | — | | | | | | 169 | | |
Total financial liabilities measured at fair value | | | | $ | 14,708 | | | | | $ | 169 | | | | | $ | — | | | | | $ | 14,877 | | |
| | | March 31, 2020 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total Fair Value | | ||||||||||||
Assets: | | | | | | | | | | | | | | | | | | | | | | | | | |
Investments segregated under federal regulations and other | | | | | | | | | | | | | | | | | | | | | | | | | |
U.S. Treasuries | | | | $ | 125,686 | | | | | $ | — | | | | | $ | — | | | | | $ | 125,686 | | |
Receivables from brokers, dealers, clearing organizations and clearing agents | | | | | | | | | | | | | | | | | | | | | | | | | |
U.S. Treasuries | | | | | 19,999 | | | | | | — | | | | | | — | | | | | | 19,999 | | |
Stablecoin assets | | | | | 100 | | | | | | — | | | | | | — | | | | | | 100 | | |
Pledged stablecoin assets | | | | | 7,000 | | | | | | — | | | | | | — | | | | | | 7,000 | | |
Other assets | | | | | 1,277 | | | | | | — | | | | | | 1,142 | | | | | | 2,419 | | |
Total financial assets measured at fair value | | | | $ | 154,062 | | | | | $ | — | | | | | $ | 1,142 | | | | | $ | 155,204 | | |
| | | March 31, 2022 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total Fair Value | | ||||||||||||
Assets: | | | | | | | | | | | | | | | | | | | | | | | | | |
Investments segregated under federal regulations and other U.S. Treasuries | | | | $ | 107,641 | | | | | $ | — | | | | | $ | — | | | | | $ | 107,641 | | |
Receivables from brokers, dealers, clearing organizations and clearing agents U.S. Treasuries | | | | | 23,922 | | | | | | — | | | | | | — | | | | | | 23,922 | | |
Cryptocurrency assets(3)(4) | | | | | 370,954 | | | | | | — | | | | | | — | | | | | | 370,954 | | |
Stablecoin assets | | | | | 1,288 | | | | | | — | | | | | | — | | | | | | 1,288 | | |
Cryptocurrency assets loaned(3) | | | | | 26,924 | | | | | | — | | | | | | — | | | | | | 26,924 | | |
Pledged stablecoin assets | | | | | 135,850 | | | | | | — | | | | | | — | | | | | | 135,850 | | |
Other assets(1)(2) | | | | | 6,380 | | | | | | — | | | | | | — | | | | | | 6,380 | | |
Total financial assets measured at fair value | | | | $ | 672,959 | | | | | $ | — | | | | | $ | — | | | | | $ | 672,959 | | |
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | |
Stablecoin payables to customers | | | | $ | 156,726 | | | | | $ | — | | | | | $ | — | | | | | $ | 156,726 | | |
Cryptocurrency payables to customers | | | | | 183,291 | | | | | | — | | | | | $ | — | | | | | | 183,291 | | |
Cryptocurrency collateral received on cryptocurrency and stablecoin assets lending | | | | | 217,256 | | | | | | — | | | | | $ | — | | | | | | 217,256 | | |
Other liabilities(2) | | | | | 4,291 | | | | | | — | | | | | | — | | | | | | 4,291 | | |
Total financial liabilities measured at fair value | | | | $ | 561,564 | | | | | $ | — | | | | | $ | — | | | | | $ | 561,564 | | |
| | | March 31, 2021 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total Fair Value | | ||||||||||||
Assets: | | | | | | | | | | | | | | | | | | | | | | | | | |
Investments segregated under federal regulations and other U.S. Treasuries | | | | $ | 69,997 | | | | | $ | — | | | | | $ | — | | | | | $ | 69,997 | | |
Receivables from brokers, dealers, clearing organizations and clearing agents | | | | | | | | | | | | | | | | | | | | | | | | | |
U.S. Treasuries | | | | | 20,000 | | | | | | — | | | | | | — | | | | | | 20,000 | | |
Cryptocurrency assets(3)(4) | | | | | 318,193 | | | | | | — | | | | | | — | | | | | | 318,193 | | |
Stablecoin assets | | | | | 1,050 | | | | | | — | | | | | | — | | | | | | 1,050 | | |
Cryptocurrency assets loaned(3) | | | | | 8,156 | | | | | | — | | | | | | — | | | | | | 8,156 | | |
Pledged stablecoin assets | | | | | 94,750 | | | | | | — | | | | | | — | | | | | | 94,750 | | |
Other assets(1)(2) | | | | | 2,400 | | | | | | — | | | | | | 866 | | | | | | 3,266 | | |
Total financial assets measured at fair value | | | | $ | 514,546 | | | | | $ | — | | | | | $ | 866 | | | | | $ | 515,412 | | |
| | | March 31, 2020 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total Fair Value | | ||||||||||||
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | |
Other liabilities | | | | $ | — | | | | | $ | 122 | | | | | $ | — | | | | | $ | 122 | | |
Total financial liabilities measured at fair value | | | | $ | — | | | | | $ | 122 | | | | | $ | — | | | | | $ | 122 | | |
|
| | | March 31, 2021 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total Fair Value | | ||||||||||||
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | |
Cryptocurrency payables to customers | | | | $ | 138,893 | | | | | $ | — | | | | | $ | — | | | | | $ | 138,893 | | |
Stablecoin payables to customers | | | | | 14,708 | | | | | | — | | | | | | — | | | | | | 14,708 | | |
Other liabilities(2) | | | | | 634 | | | | | | 169 | | | | | | — | | | | | | 803 | | |
Total financial liabilities measured at fair value | | | | $ | 154,235 | | | | | $ | 169 | | | | | $ | — | | | | | $ | 154,404 | | |
|
| | | March 31, 2021 | | |||||||||||||||||||||||||||
| | | Gross amounts recognized as assets/liabilities | | | Gross amounts offset in the consolidated statements of financial condition | | | Net amounts presented in the consolidated statements of financial condition | | | Gross amounts not offset in the consolidated statements of financial condition Collateral received or pledged (including cash) | | | Net amount | | |||||||||||||||
Assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Securities borrowed(1) | | | | $ | 335,057 | | | | | $ | — | | | | | $ | 335,057 | | | | | $ | (323,790) | | | | | $ | 11,267 | | |
Pledged stablecoin assets(3) | | | | | 94,750 | | | | | | — | | | | | | 94,750 | | | | | | (94,750) | | | | | | — | | |
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Securities loaned(2) | | | | $ | 531,818 | | | | | $ | — | | | | | $ | 531,818 | | | | | $ | (511,569) | | | | | $ | 20,249 | | |
| | | March 31, 2020 | | |||||||||||||||||||||||||||
| | | Gross amounts recognized as assets/liabilities | | | Gross amounts offset in the consolidated statements of financial condition | | | Net amounts presented in the consolidated statements of financial condition | | | Gross amounts not offset in the consolidated statements of financial condition Collateral received or pledged (including cash) | | | Net amount | | |||||||||||||||
Assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Securities borrowed(1) | | | | $ | 266,839 | | | | | $ | — | | | | | $ | 266,839 | | | | | $ | (248,483) | | | | | $ | 18,356 | | |
Pledged stablecoin assets(3) | | | | | 7,000 | | | | | | — | | | | | | 7,000 | | | | | | (7,000) | | | | | | — | | |
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Securities loaned(2) | | | | $ | 289,205 | | | | | $ | — | | | | | $ | 289,205 | | | | | $ | (264,307) | | | | | $ | 24,898 | | |
Cash collateral received on cryptocurrency assets lending | | | | | 11,900 | | | | | | — | | | | | | 11,900 | | | | | | (11,900) | | | | | | — | | |
| | | March 31, 2022 | | |||||||||||||||||||||||||||
| | | Gross amounts recognized as assets/liabilities | | | Gross amounts offset in the consolidated statements of financial condition | | | Net amounts presented in the consolidated statements of financial condition | | | Gross amounts not offset in the consolidated statements of financial condition Collateral received or pledged (including cash) | | | Net amount | | |||||||||||||||
Assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Securities borrowed(1) | | | | $ | 670,936 | | | | | $ | — | | | | | $ | 670,936 | | | | | $ | (622,618) | | | | | $ | 48,318 | | |
Pledged stablecoin assets(3) | | | | | 135,850 | | | | | | — | | | | | | 135,850 | | | | | | (135,850) | | | | | | — | | |
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Securities loaned(2) | | | | $ | 680,208 | | | | | $ | — | | | | | $ | 680,208 | | | | | $ | (627,678) | | | | | $ | 52,530 | | |
| | | March 31, 2021 | | |||||||||||||||||||||||||||
| | | Gross amounts recognized as assets/liabilities | | | Gross amounts offset in the consolidated statements of financial condition | | | Net amounts presented in the consolidated statements of financial condition | | | Gross amounts not offset in the consolidated statements of financial condition Collateral received or pledged (including cash) | | | Net amount | | |||||||||||||||
Assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Securities borrowed(1) | | | | $ | 335,057 | | | | | $ | — | | | | | $ | 335,057 | | | | | $ | (323,790) | | | | | $ | 11,267 | | |
Pledged stablecoin assets(3) | | | | | 94,750 | | | | | | — | | | | | | 94,750 | | | | | | (94,750) | | | | | | — | | |
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Securities loaned(2) | | | | $ | 531,818 | | | | | $ | — | | | | | $ | 531,818 | | | | | $ | (511,569) | | | | | $ | 20,249 | | |
| | March 31, | | | March 31, | | ||||||||||||||||||||||||||||||||
| | 2021 | | 2020 | | 2019 | | | 2022 | | 2021 | | 2020 | | ||||||||||||||||||||||||
Current | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
Federal | | | $ | 1,944 | | | | $ | 8 | | | | $ | (42) | | | | | $ | 401 | | | | $ | 1,944 | | | | $ | 8 | | | ||||||
State | | | | 1,427 | | | | | 86 | | | | | 77 | | | | | | 827 | | | | | 1,427 | | | | | 86 | | | ||||||
Foreign | | | | 1,569 | | | | | 30 | | | | | — | | | | | | 1,526 | | | | | 1,569 | | | | | 30 | | | ||||||
| | | | 4,940 | | | | | 124 | | | | | 35 | | | ||||||||||||||||||||||
Total current | | | | 2,754 | | | | | 4,940 | | | | | 124 | | | ||||||||||||||||||||||
Deferred | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
Federal | | | | 3,788 | | | | | 1,653 | | | | | 5,164 | | | | | | (10,128) | | | | | 3,788 | | | | | 1,653 | | | ||||||
State | | | | 115 | | | | | 387 | | | | | 1,018 | | | | | | (32) | | | | | 115 | | | | | 387 | | | ||||||
Foreign | | | | — | | | | | — | | | | | — | | | | | | — | | | | | — | | | | | — | | | ||||||
| | | | 3,903 | | | | | 2,040 | | | | | 6,182 | | | ||||||||||||||||||||||
Provision for income taxes | | | $ | 8,843 | | | | $ | 2,164 | | | | $ | 6,217 | | | ||||||||||||||||||||||
Total deferred | | | | (10,160) | | | | | 3,903 | | | | | 2,040 | | | ||||||||||||||||||||||
Total income tax expense (benefit) | | | $ | (7,406) | | | | $ | 8,843 | | | | $ | 2,164 | | |
| | | March 31, | | |||||||||||||||
| | | 2021 | | | 2020 | | | 2019 | | |||||||||
Domestic | | | | $ | 25,001 | | | | | $ | 11,495 | | | | | $ | 24,030 | | |
| | March 31, | | | March 31, | | ||||||||||||||||||||||||||||||||
| | 2021 | | 2020 | | 2019 | | | 2022 | | 2021 | | 2020 | | ||||||||||||||||||||||||
Domestic | | | $ | (48,281) | | | | $ | 25,001 | | | | $ | 9,225 | | | ||||||||||||||||||||||
Foreign | | | | 7,632 | | | | | 946 | | | | | 783 | | | | | | 9,179 | | | | | 7,632 | | | | | 3,216 | | | ||||||
Income before income taxes | | | $ | 32,633 | | | | $ | 12,441 | | | | $ | 24,813 | | | | | $ | (39,102) | | | | $ | 32,633 | | | | $ | 12,441 | | | ||||||
|
| | March 31, | | | March 31, | | ||||||||||||||||||||
| | 2021 | | 2020 | | | 2022 | | 2021 | | ||||||||||||||||
Deferred income tax assets: | | | | | | | | | | | | | | | | | | | | | | | ||||
Net operating loss carryforward | | | $ | 479 | | | | $ | 1,626 | | | | | $ | 10,863 | | | | $ | 479 | | | ||||
Tax credit carryforward | | | | 2,209 | | | | | 7,169 | | | | | | 3,097 | | | | | 2,209 | | | ||||
Lease liability | | | | 4,096 | | | | | 2,929 | | | | | | 3,963 | | | | | 4,096 | | | ||||
Cryptocurrency payables to customers | | | | 34,224 | | | | | 410 | | | | | | 42,332 | | | | | 34,224 | | | ||||
Cryptocurrency collateral received | | | | 46,656 | | | | | 2,369 | | | | | | 56,374 | | | | | 46,656 | | | ||||
Accrued liabilities and deferred income | | | | 3,706 | | | | | 2,506 | | | | | | 5,235 | | | | | 3,706 | | | ||||
Other | | | | 358 | | | | | 428 | | | | | | 364 | | | | | 358 | | | ||||
Valuation allowance | | | | (669) | | | | | (520) | | | | | | (763) | | | | | (669) | | | ||||
Deferred income tax assets | | | | 91,059 | | | | | 16,917 | | | | | | 121,465 | | | | | 91,059 | | | ||||
Deferred income tax liabilities: | | | | | | | | | | | | |||||||||||||||
Depreciation and amortization | | | | 25,065 | | | | | 26,494 | | | |||||||||||||||
Right-of-use asset | | | | 3,115 | | | | | 2,502 | | | |||||||||||||||
Cryptocurrency assets | | | | 80,550 | | | | | 1,757 | | | |||||||||||||||
Other | | | | 453 | | | | | 385 | | | |||||||||||||||
Deferred income tax liabilities | | | | 109,183 | | | | | 31,138 | | | |||||||||||||||
Net deferred income tax liabilities | | | $ | 18,124 | | | | $ | 14,221 | | |
| | | March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
Deferred income tax liabilities: | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 26,094 | | | | | | 25,065 | | |
Right-of-use asset | | | | | 3,391 | | | | | | 3,115 | | |
Cryptocurrency assets | | | | | 98,354 | | | | | | 80,550 | | |
Unrealized losses | | | | | 1,585 | | | | | | — | | |
Other | | | | | — | | | | | | 453 | | |
Deferred income tax liabilities | | | | | 129,424 | | | | | | 109,183 | | |
Net deferred income tax liabilities | | | | $ | 7,959 | | | | | $ | 18,124 | | |
|
| | March 31, | | | March 31, | | ||||||||||||||||||||||||||||||||
| | 2021 | | 2020 | | 2019 | | | 2022 | | 2021 | | 2020 | | ||||||||||||||||||||||||
Federal statutory rate | | | | 21.0% | | | | | 21.0% | | | | | 21.0% | | | | | | 21.0% | | | | | 21.0% | | | | | 21.0% | | | ||||||
Foreign Rate Differential | | | | (0.6) | | | | | (1.6) | | | | | (0.7) | | | | | | 0.6 | | | | | (0.6) | | | | | (1.6) | | | ||||||
State and local income taxes, net of federal tax benefits | | | | 3.5 | | | | | 4.1 | | | | | 3.9 | | | | | | 4.2 | | | | | 3.5 | | | | | 4.1 | | | ||||||
Tax credits generated, net of expirations | | | | (2.5) | | | | | (3.1) | | | | | 0.4 | | | | | | 1.6 | | | | | (2.5) | | | | | (3.1) | | | ||||||
Impact of state rate changes | | | | 0.6 | | | | | (1.7) | | | | | 1.4 | | | | | | (2.8) | | | | | 0.6 | | | | | (1.7) | | | ||||||
Nondeductible expenses | | | | 0.6 | | | | | 1.3 | | | | | 0.5 | | | | | | 2.8 | | | | | 0.6 | | | | | 1.3 | | | ||||||
Uncertain tax benefits | | | | 0.3 | | | | | (5.1) | | | | | (1.1) | | | | | | (5.1) | | | | | 0.3 | | | | | (5.1) | | | ||||||
Valuation allowance | | | | 0.5 | | | | | (1.6) | | | | | (1.7) | | | | | | (0.2) | | | | | 0.5 | | | | | (1.6) | | | ||||||
Foreign Taxes less US Deduction | | | | 3.8 | | | | | 0.2 | | | | | — | | | | | | (3.9) | | | | | 3.8 | | | | | 0.2 | | | ||||||
Global Intangible Low-Taxed Income | | | | 0.7 | | | | | 1.9 | | | | | 0.6 | | | | | | (0.7) | | | | | 0.7 | | | | | 1.9 | | | ||||||
Other | | | | (0.8) | | | | | 2.0 | | | | | 0.7 | | | | | | 1.5 | | | | | (0.8) | | | | | 2.0 | | | ||||||
| | | | 27.1% | | | | | 17.4% | | | | | 25.0% | | | | | | 19.0% | | | | | 27.1% | | | | | 17.4% | | |
| | March 31, | | | March 31, | | ||||||||||||||||||||
| | 2021 | | 2020 | | | 2022 | | 2021 | | ||||||||||||||||
Beginning balance | | | $ | 168 | | | | $ | 871 | | | | | $ | 242 | | | | $ | 168 | | | ||||
Increases related to tax positions taken during a prior period | | | | 15 | | | | | — | | | | | | 16 | | | | | 15 | | | ||||
Increases related to tax positions taken during the current period | | | | 59 | | | | | 43 | | | | | | 1,766 | | | | | 59 | | | ||||
Decreases as a result of a lapse of the applicable statute of limitations | | | | — | | | | | (48) | | | | | | — | | | | | — | | | ||||
Decreases related to tax positions taken during a prior period | | | | — | | | | | (698) | | | | | | (2) | | | | | — | | | ||||
Ending balance | | | $ | 242 | | | | $ | 168 | | | | | $ | 2,022 | | | | $ | 242 | | |
Year Ended March 31, | | | | | | | | | | | | | ||
2022 | | | $ | 2,373 | | | ||||||||
2023 | | | | 2,540 | | | | | $ | 2,608 | | | ||
2024 | | | | 2,473 | | | | | | 2,520 | | | ||
2025 | | | | 2,320 | | | | | | 2,393 | | | ||
2026 | | | | 1,948 | | | | | | 2,023 | | | ||
2027 | | | | 1,704 | | | ||||||||
Thereafter | | | | 8,443 | | | | | | 6,809 | | | ||
Total undiscounted lease payments | | | | 20,097 | | | | | | 18,057 | | | ||
Interest | | | | (1,755) | | | ||||||||
Less: imputed interest | | | | (1,386) | | | ||||||||
Present value of lease liabilities | | | $ | 18,342 | | | | | $ | 16,671 | | |
| | Year Ended March 31, | | | Year Ended March 31, | | ||||||||||||||||||||||||||||||||
| | 2021 | | 2020 | | 2019 | | | 2022 | | 2021 | | 2020 | | ||||||||||||||||||||||||
Revenues: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
Trading-related revenue(1) | | | $ | 7,853 | | | | $ | 2,152 | | | | $ | 1,389 | | | | | $ | 3,919 | | | | $ | 7,853 | | | | $ | 2,152 | | | ||||||
Subscription and other revenue(2) | | | | 3,675 | | | | | 5,153 | | | | | 7,226 | | | | | | 3,433 | | | | | 3,675 | | | | | 5,153 | | | ||||||
Expenses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
Interest expense on borrowings(4) | | | | 2,228 | | | | | 2,128 | | | | | 4,409 | | | ||||||||||||||||||||||
Professional services(3) | | | $ | 140 | | | | $ | 148 | | | | $ | — | | | | | $ | 140 | | | | $ | 140 | | | | $ | 148 | | |
| | March 31, | | |||||||||||||||||||||||
| | 2021 | | 2020 | | | March 31, 2022 | | March 31, 2021 | | ||||||||||||||||
Assets: | | | | | | | | | | | | | | | | | | | | | | | ||||
Due from affiliated companies(4) | | | $ | 1,630 | | | | $ | 2,162 | | | |||||||||||||||
Due from affiliated companies(5) | | | $ | 1,269 | | | | $ | 1,630 | | | |||||||||||||||
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | ||||
Notes payable(5) | | | $ | 123,000 | | | | $ | 134,000 | | | |||||||||||||||
Due to affiliated companies(6) | | | | 413 | | | | | 1,511 | | | |||||||||||||||
Note Payable(6) | | | $ | 178,000 | | | | $ | 123,000 | | | |||||||||||||||
Due to affiliated companies(7) | | | | 506 | | | | | 413 | | |
| | | March 31, | | |||||||||||||||
| | | 2022 | | | 2021 | | | 2020 | | |||||||||
Current | | | | | | | | | | | | | | | | | | | |
Federal | | | | $ | 401 | | | | | $ | 1,944 | | | | | $ | 8 | | |
State | | | | | 827 | | | | | | 1,427 | | | | | | 86 | | |
Foreign | | | | | 1,526 | | | | | | 1,569 | | | | | | 30 | | |
Total current | | | | | 2,754 | | | | | | 4,940 | | | | | | 124 | | |
Deferred | | | | | | | | | | | | | | | | | | | |
Federal | | | | | (10,128) | | | | | | 3,788 | | | | | | 1,653 | | |
State | | | | | (32) | | | | | | 115 | | | | | | 387 | | |
Foreign | | | | | — | | | | | | — | | | | | | — | | |
Total deferred | | | | | (10,160) | | | | | | 3,903 | | | | | | 2,040 | | |
Total income tax expense (benefit) | | | | $ | (7,406) | | | | | $ | 8,843 | | | | | $ | 2,164 | | |
| | | March 31, | | |||||||||||||||
| | | 2022 | | | 2021 | | | 2020 | | |||||||||
Domestic | | | | $ | (48,281) | | | | | $ | 25,001 | | | | | $ | 9,225 | | |
Foreign | | | | | 9,179 | | | | | | 7,632 | | | | | | 3,216 | | |
Income before income taxes | | | | $ | (39,102) | | | | | $ | 32,633 | | | | | $ | 12,441 | | |
| | | March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
Deferred income tax assets: | | | | | | | | | | | | | |
Net operating loss carryforward | | | | $ | 10,863 | | | | | $ | 479 | | |
Tax credit carryforward | | | | | 3,097 | | | | | | 2,209 | | |
Lease liability | | | | | 3,963 | | | | | | 4,096 | | |
Cryptocurrency payables to customers | | | | | 42,332 | | | | | | 34,224 | | |
Cryptocurrency collateral received | | | | | 56,374 | | | | | | 46,656 | | |
Accrued liabilities and deferred income | | | | | 5,235 | | | | | | 3,706 | | |
Other | | | | | 364 | | | | | | 358 | | |
Valuation allowance | | | | | (763) | | | | | | (669) | | |
Deferred income tax assets | | | | | 121,465 | | | | | | 91,059 | | |
| | | March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
Deferred income tax liabilities: | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 26,094 | | | | | | 25,065 | | |
Right-of-use asset | | | | | 3,391 | | | | | | 3,115 | | |
Cryptocurrency assets | | | | | 98,354 | | | | | | 80,550 | | |
Unrealized losses | | | | | 1,585 | | | | | | — | | |
Other | | | | | — | | | | | | 453 | | |
Deferred income tax liabilities | | | | | 129,424 | | | | | | 109,183 | | |
Net deferred income tax liabilities | | | | $ | 7,959 | | | | | $ | 18,124 | | |
|
| | | March 31, | | |||||||||||||||
| | | 2022 | | | 2021 | | | 2020 | | |||||||||
Federal statutory rate | | | | | 21.0% | | | | | | 21.0% | | | | | | 21.0% | | |
Foreign Rate Differential | | | | | 0.6 | | | | | | (0.6) | | | | | | (1.6) | | |
State and local income taxes, net of federal tax benefits | | | | | 4.2 | | | | | | 3.5 | | | | | | 4.1 | | |
Tax credits generated, net of expirations | | | | | 1.6 | | | | | | (2.5) | | | | | | (3.1) | | |
Impact of state rate changes | | | | | (2.8) | | | | | | 0.6 | | | | | | (1.7) | | |
Nondeductible expenses | | | | | 2.8 | | | | | | 0.6 | | | | | | 1.3 | | |
Uncertain tax benefits | | | | | (5.1) | | | | | | 0.3 | | | | | | (5.1) | | |
Valuation allowance | | | | | (0.2) | | | | | | 0.5 | | | | | | (1.6) | | |
Foreign Taxes less US Deduction | | | | | (3.9) | | | | | | 3.8 | | | | | | 0.2 | | |
Global Intangible Low-Taxed Income | | | | | (0.7) | | | | | | 0.7 | | | | | | 1.9 | | |
Other | | | | | 1.5 | | | | | | (0.8) | | | | | | 2.0 | | |
| | | | | 19.0% | | | | | | 27.1% | | | | | | 17.4% | | |
| | | December 31, 2021 | | | March 31, 2021 | | ||||||
ASSETS | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 206,699 | | | | | $ | 84,399 | | |
Cash and investments segregated under federal regulations and other | | | | | 2,819,543 | | | | | | 2,808,981 | | |
Receivables from brokers, dealers, clearing organizations and clearing agents | | | | | 72,369 | | | | | | 90,245 | | |
Securities borrowed | | | | | 572,840 | | | | | | 335,057 | | |
Receivables from brokerage customers, net | | | | | 179,792 | | | | | | 219,839 | | |
Cryptocurrency assets | | | | | 322,824 | | | | | | 319,408 | | |
Stablecoin assets | | | | | 1,245 | | | | | | 1,050 | | |
Cryptocurrency assets loaned | | | | | 44,246 | | | | | | 8,156 | | |
Pledged stablecoin assets | | | | | 137,450 | | | | | | 94,750 | | |
Due from affiliated companies | | | | | 551 | | | | | | 1,630 | | |
Property and equipment, net | | | | | 47,054 | | | | | | 42,439 | | |
Goodwill and intangible assets, net | | | | | 151,623 | | | | | | 158,316 | | |
Right-of-use assets, net | | | | | 13,864 | | | | | | 16,073 | | |
Other assets | | | | | 41,163 | | | | | | 17,154 | | |
Total assets | | | | $ | 4,611,263 | | | | | $ | 4,197,497 | | |
LIABILITIES AND SHAREHOLDER’S EQUITY | | | | | | | | | | | | | |
Liabilities: | | | | | | | | | | | | | |
Payables to brokers, dealers and clearing organizations | | | | $ | 2,631 | | | | | $ | 3,791 | | |
Securities loaned | | | | | 601,575 | | | | | | 531,818 | | |
Payables to brokerage customers | | | | | 2,983,708 | | | | | | 2,795,154 | | |
Cryptocurrency and stablecoin payables to customers | | | | | 280,072 | | | | | | 153,601 | | |
Cryptocurrency collateral received on cryptocurrency and stablecoin assets lending | | | | | 190,876 | | | | | | 189,386 | | |
Operating lease liabilities | | | | | 17,471 | | | | | | 18,342 | | |
Notes payable | | | | | 268,000 | | | | | | 203,000 | | |
Deferred income taxes, net | | | | | 10,866 | | | | | | 18,124 | | |
Other liabilities | | | | | 52,931 | | | | | | 40,546 | | |
Due to affiliated companies | | | | | 495 | | | | | | 413 | | |
Total liabilities | | | | | 4,408,625 | | | | | | 3,954,175 | | |
COMMITMENTS AND CONTINGENCIES (see Note 12) | | | | | | | | | | | | | |
Shareholder’s equity: | | | | | | | | | | | | | |
Preferred stock, $0.01 par value; 25,000,000 shares authorized, no shares issued and outstanding | | | | | — | | | | | | — | | |
Common stock, $0.01 par value; 200,000,000 shares authorized, 1,000 issued and outstanding | | | | | — | | | | | | — | | |
Additional paid-in capital | | | | | 171,278 | | | | | | 171,278 | | |
Retained earnings | | | | | 31,360 | | | | | | 72,044 | | |
Total shareholder’s equity | | | | | 202,638 | | | | | | 243,322 | | |
Total liabilities and shareholder’s equity | | | | $ | 4,611,263 | | | | | $ | 4,197,497 | | |
| | | Nine Months Ended December 31, | | |||||||||
| | | 2021 | | | 2020 | | ||||||
Revenues: | | | | | | | | | | | | | |
Trading-related revenue | | | | $ | 121,334 | | | | | $ | 118,299 | | |
Subscription and other revenue | | | | | 4,402 | | | | | | 6,449 | | |
Total non-interest income | | | | | 125,736 | | | | | | 124,748 | | |
Interest income | | | | | 37,959 | | | | | | 31,209 | | |
Interest expense | | | | | (6,688) | | | | | | (2,311) | | |
Net interest income | | | | | 31,271 | | | | | | 28,898 | | |
Total net revenues | | | | | 157,007 | | | | | | 153,646 | | |
Expenses: | | | | | | | | | | | | | |
Employee compensation and benefits | | | | | 68,628 | | | | | | 53,050 | | |
Cost of services provided | | | | | 25,186 | | | | | | 24,439 | | |
Communications | | | | | 11,508 | | | | | | 10,497 | | |
Marketing | | | | | 39,595 | | | | | | 11,949 | | |
Professional services | | | | | 8,123 | | | | | | 4,729 | | |
Occupancy and equipment | | | | | 12,329 | | | | | | 9,815 | | |
Depreciation and amortization of property and equipment | | | | | 7,983 | | | | | | 7,476 | | |
Amortization of intangibles | | | | | 6,693 | | | | | | 6,707 | | |
Interest expense on borrowings | | | | | 2,293 | | | | | | 2,402 | | |
Other expense (income) | | | | | (2,348) | | | | | | 16,365 | | |
Total expenses | | | | | 179,990 | | | | | | 147,429 | | |
Income (loss) before income taxes | | | | | (22,983) | | | | | | 6,217 | | |
Income tax expense (benefit) | | | | | (6,037) | | | | | | 1,695 | | |
Net income (loss) | | | | $ | (16,946) | | | | | $ | 4,522 | | |
Net income (loss) per common share, basic and diluted | | | | $ | (16,946) | | | | | $ | 4,522 | | |
Weighted-average common shares outstanding, basic and diluted | | | | | 1,000 | | | | | | 1,000 | | |
| | | Preferred stock | | | Common stock | | | Additional paid-in capital | | | Retained earnings | | | Total | | |||||||||||||||||||||||||||
| | | Shares | | | Amount | | | Shares | | | Amount | | ||||||||||||||||||||||||||||||
Balance at March 31, 2020 | | | | | — | | | | | $ | — | | | | | | 1,000 | | | | | $ | — | | | | | $ | 171,278 | | | | | $ | 48,254 | | | | | $ | 219,532 | | |
Net income | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 4,522 | | | | | | 4,522 | | |
Balance at December 31, 2020 | | | | | — | | | | | $ | — | | | | | | 1,000 | | | | | $ | — | | | | | $ | 171,278 | | | | | $ | 52,776 | | | | | $ | 224,054 | | |
Balance at March 31, 2021 | | | | | — | | | | | $ | — | | | | | | 1,000 | | | | | $ | — | | | | | $ | 171,278 | | | | | $ | 72,044 | | | | | $ | 243,322 | | |
Net loss | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (16,946) | | | | | | (16,946) | | |
Dividend paid to Parent Company | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (23,738) | | | | | | (23,738) | | |
Balance at December 31, 2021 | | | | | — | | | | | $ | — | | | | | | 1,000 | | | | | $ | — | | | | | $ | 171,278 | | | | | $ | 31,360 | | | | | $ | 202,638 | | |
| | | Nine Months Ended December 31, | | | |||||||||||
| | | 2021 | | | 2020 | | | ||||||||
Cash flows from operating activities: | | | | | | | | | | | | | | | ||
Net income | | | | $ | (16,946) | | | | | $ | 4,522 | | | | ||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | | | | | | | | | | | | | | | ||
Deferred tax expense (benefit) | | | | | (7,258) | | | | | | 134 | | | | ||
Depreciation and amortization | | | | | 14,676 | | | | | | 14,183 | | | | ||
Gain on investment | | | | | (8,146) | | | | | | — | | | | ||
Loss on disposal of property and equipment | | | | | 225 | | | | | | 157 | | | | ||
Impairment loss on cryptocurrency assets | | | | | — | | | | | | 22,504 | | | | ||
Gain on cryptocurrency assets | | | | | (34) | | | | | | (12,090) | | | | ||
Other, net | | | | | 637 | | | | | | (15) | | | | | |
Changes in operating assets and liabilities: | | | | | | | | | | | | | | | ||
Investments segregated under federal regulations and other | | | | | (39,747) | | | | | | 55,713 | | | | ||
Receivables from brokers, dealers, clearing organizations and clearing agents | | | | | 17,876 | | | | | | 13,953 | | | | ||
Securities borrowed | | | | | (237,784) | | | | | | 65,118 | | | | ||
Receivables from brokerage customers, net | | | | | 40,047 | | | | | | (131,296) | | | | ||
Stablecoin assets, net of stablecoin payables to customers | | | | | 87,702 | | | | | | 2,987 | | | | ||
Pledged stablecoin assets | | | | | (42,700) | | | | | | (77,050) | | | | ||
Cash collateral received on cryptocurrency assets lending | | | | | — | | | | | | (11,900) | | | | ||
Due from/to affiliated companies, net | | | | | 1,161 | | | | | | (308) | | | | ||
Other assets | | | | | (12,253) | | | | | | 407 | | | | ||
Payable to brokers, dealers and clearing organizations | | | | | (807) | | | | | | (611) | | | | ||
Securities loaned | | | | | 69,757 | | | | | | 30,006 | | | | ||
Payables to brokerage customers | | | | | 188,554 | | | | | | 552,005 | | | | ||
Other liabilities | | | | | 10,766 | | | | | | 6,317 | | | | ||
Net cash provided by operating activities | | | | | 65,726 | | | | | | 534,736 | | | | ||
Cash flows from investing activities: | | | | | | | | | | | | | | | ||
Purchase of property and equipment | | | | | (4,192) | | | | | | (4,834) | | | | ||
Capitalized internally developed software | | | | | (9,273) | | | | | | (7,063) | | | | ||
Other, net | | | | | (411) | | | | | | (650) | | | | ||
Net cash used in investing activities | | | | | (13,876) | | | | | | (12,547) | | | | ||
Cash flows from financing activities: | | | | | | | | | | | | | | | ||
Proceeds from notes payable | | | | | 95,000 | | | | | | 62,000 | | | | ||
Repayment of notes payable | | | | | (30,000) | | | | | | (41,000) | | | | ||
Payment of dividend to Parent Company | | | | | (23,738) | | | | | | — | | | | ||
Net cash provided by financing activities | | | | | 41,262 | | | | | | 21,000 | | | | ||
Net increase in cash, cash equivalents and cash segregated | | | | | 93,112 | | | | | | 543,189 | | | | ||
Cash, cash equivalents and cash segregated at beginning of period | | | | | 2,823,383 | | | | | | 2,074,555 | | | | ||
Cash, cash equivalents and cash segregated at end of period | | | | $ | 2,916,495 | | | | | $ | 2,617,744 | | | | ||
Cash and cash equivalents at end of period | | | | $ | 206,699 | | | | | $ | 111,182 | | | | ||
Cash segregated at end of period | | | | | 2,709,796 | | | | | | 2,506,562 | | | | ||
Cash, cash equivalents and cash segregated at end of period | | | | $ | 2,916,495 | | | | | $ | 2,617,744 | | | |
| | | March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
Beginning balance | | | | $ | 242 | | | | | $ | 168 | | |
Increases related to tax positions taken during a prior period | | | | | 16 | | | | | | 15 | | |
Increases related to tax positions taken during the current period | | | | | 1,766 | | | | | | 59 | | |
Decreases as a result of a lapse of the applicable statute of limitations | | | | | — | | | | | | — | | |
Decreases related to tax positions taken during a prior period | | | | | (2) | | | | | | — | | |
Ending balance | | | | $ | 2,022 | | | | | $ | 242 | | |
Year Ended March 31, | | | | | | | |
2023 | | | | $ | 2,608 | | |
2024 | | | | | 2,520 | | |
2025 | | | | | 2,393 | | |
2026 | | | | | 2,023 | | |
2027 | | | | | 1,704 | | |
Thereafter | | | | | 6,809 | | |
Total undiscounted lease payments | | | | | 18,057 | | |
Less: imputed interest | | | | | (1,386) | | |
Present value of lease liabilities | | | | $ | 16,671 | | |
| | | December 31, 2021 | | | March 31, 2021 | | ||||||
Deposits with clearing organizations | | | | $ | 63,997 | | | | | $ | 81,197 | | |
Receivables from order flow | | | | | 4,473 | | | | | | 5,557 | | |
Securities failed to deliver to broker-dealers | | | | | 205 | | | | | | 731 | | |
Other | | | | | 3,694 | | | | | | 2,760 | | |
| | | | $ | 72,369 | | | | | $ | 90,245 | | |
| | | Year Ended March 31, | | |||||||||||||||
| | | 2022 | | | 2021 | | | 2020 | | |||||||||
Revenues: | | | | | | | | | | | | | | | | | | | |
Trading-related revenue(1) | | | | $ | 3,919 | | | | | $ | 7,853 | | | | | $ | 2,152 | | |
Subscription and other revenue(2) | | | | | 3,433 | | | | | | 3,675 | | | | | | 5,153 | | |
Expenses: | | | | | | | | | | | | | | | | | | | |
Interest expense on borrowings(4) | | | | | 2,228 | | | | | | 2,128 | | | | | | 4,409 | | |
Professional services(3) | | | | $ | 140 | | | | | $ | 140 | | | | | $ | 148 | | |
| | | December 31, 2021 | | | March 31, 2021 | | ||||||
Payables to clearing organizations | | | | $ | 2,574 | | | | | $ | 3,482 | | |
Payables to brokers-dealers | | | | | 57 | | | | | | 309 | | |
| | | | $ | 2,631 | | | | | $ | 3,791 | | |
| | | Carrying value March 31, 2021 | | | Purchases | | | Net increase/ decrease(1) | | | Impairment(2) | | | Net realized/ unrealized gains (losses)(3) | | | Carrying value December 31, 2021 | | ||||||||||||||||||
Cryptocurrency assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Firm assets | | | | $ | 406 | | | | | $ | 411 | | | | | $ | (555) | | | | | $ | — | | | | | $ | 29 | | | | | $ | 291 | | |
Collateral assets | | | | | 189,386 | | | | | | — | | | | | | 97,864 | | | | | | — | | | | | | (96,374) | | | | | | 190,876 | | |
Customer assets | | | | | 129,616 | | | | | | — | | | | | | 29,753 | | | | | | — | | | | | | (27,712) | | | | | | 131,657 | | |
| | | | $ | 319,408 | | | | | $ | 411 | | | | | $ | 127,062 | | | | | $ | — | | | | | $ | (124,057) | | | | | $ | 322,824 | | |
Cryptocurrency assets loaned | | | | $ | 8,156 | | | | | $ | — | | | | | $ | 20,852 | | | | | $ | — | | | | | $ | 15,238 | | | | | $ | 44,246 | | |
| | | Carrying value March 31, 2020 | | | Purchases | | | Net increase/ decrease(1) | | | Impairment(2) | | | Net realized/ unrealized gains (losses)(3) | | | Carrying value March 31, 2021 | | ||||||||||||||||||
Cryptocurrency assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Firm assets | | | | $ | 148 | | | | | $ | 250 | | | | | $ | (26) | | | | | $ | — | | | | | $ | 34 | | | | | $ | 406 | | |
Collateral assets | | | | | 5,942 | | | | | | — | | | | | | 110,606 | | | | | | (15,060) | | | | | | 87,898 | | | | | | 189,386 | | |
Customer assets | | | | | 1,337 | | | | | | — | | | | | | 112,033 | | | | | | (10,274) | | | | | | 26,520 | | | | | | 129,616 | | |
| | | | $ | 7,427 | | | | | $ | 250 | | | | | $ | 222,613 | | | | | $ | (25,334) | | | | | $ | 114,452 | | | | | $ | 319,408 | | |
Cryptocurrency assets loaned | | | | $ | — | | | | | $ | — | | | | | $ | 3,204 | | | | | $ | — | | | | | $ | 4,952 | | | | | $ | 8,156 | | |
| | | March 31, 2022 | | | March 31, 2021 | | ||||||
Assets: | | | | | | | | | | | | | |
Due from affiliated companies(5) | | | | $ | 1,269 | | | | | $ | 1,630 | | |
Liabilities: | | | | | | | | | | | | | |
Note Payable(6) | | | | $ | 178,000 | | | | | $ | 123,000 | | |
Due to affiliated companies(7) | | | | | 506 | | | | | | 413 | | |
| | | Currency type | | | Notional (in Currency unit) | | | Hybrid Instruments | | | Carrying Amount | | ||||||||||||||||||
| Not designated as hedges | | | Designated as hedges | | ||||||||||||||||||||||||||
Cryptocurrency payables to Customers | | | | | BTC | | | | | | 1,929.37 | | | | | $ | 76 | | | | | $ | 89,327 | | | | | $ | 89,403 | | |
| | | ETH | | | | | | 22,326.33 | | | | | | 71 | | | | | | 82,269 | | | | | | 82,340 | | | ||
| | | LTC | | | | | | 19,216.74 | | | | | | 1 | | | | | | 2,809 | | | | | | 2,810 | | | ||
| | | BCH | | | | | | 1,608.29 | | | | | | — | | | | | | 688 | | | | | | 688 | | | ||
| | | XRP | | | | | | 2,740,919.99 | | | | | | — | | | | | | 2,278 | | | | | | 2,278 | | | ||
| | | | | | | | | | | | | | $ | 148 | | | | | $ | 177,371 | | | | | $ | 177,519 | | |
| | | Currency type | | | Notional (in Currency unit) | | | Hybrid Instruments | | | Carrying Amount | | ||||||||||||||||||
| Not designated as hedges | | | Designated as hedges | | ||||||||||||||||||||||||||
Cryptocurrency collateral received | | | | | BTC | | | | | | 4,119.58 | | | | | $ | — | | | | | $ | 190,731 | | | | | $ | 190,731 | | |
| | | ETH | | | | | | 39.35 | | | | | | — | | | | | | 145 | | | | | | 145 | | | ||
| | | | | | | | | | | | | | $ | — | | | | | $ | 190,876 | | | | | $ | 190,876 | | |
| | | Currency type | | | Notional (in Currency unit) | | | Hybrid Instruments | | | Carrying Amount | | ||||||||||||||||||
| Not designated as hedges | | | Designated as hedges | | ||||||||||||||||||||||||||
Cryptocurrency payables to customers | | | | | BTC | | | | | | 1,752.59 | | | | | $ | — | | | | | $ | 103,221 | | | | | $ | 103,221 | | |
| | | ETH | | | | | | 15,750.91 | | | | | | — | | | | | | 30,579 | | | | | | 30,579 | | | ||
| | | LTC | | | | | | 11,462.16 | | | | | | — | | | | | | 2,244 | | | | | | 2,244 | | | ||
| | | BCH | | | | | | 1,328.83 | | | | | | — | | | | | | 710 | | | | | | 710 | | | ||
| | | XRP | | | | | | 3,726,713.16 | | | | | | — | | | | | | 2,139 | | | | | | 2,139 | | | ||
| | | | | | | | | | | | | | $ | — | | | | | $ | 138,893 | | | | | $ | 138,893 | | |
| | | Currency type | | | Notional (in Currency unit) | | | Hybrid Instruments | | | Carrying Amount | | ||||||||||||||||||
| Not designated as hedges | | | Designated as hedges | | ||||||||||||||||||||||||||
Cryptocurrency collateral received | | | | | BTC | | | | | | 3,159.07 | | | | | $ | — | | | | | $ | 186,057 | | | | | $ | 186,057 | | |
| | | ETH | | | | | | 1,715.00 | | | | | | — | | | | | | 3,329 | | | | | | 3,329 | | | ||
| | | | | | | | | | | | | | $ | — | | | | | $ | 189,386 | | | | | $ | 189,386 | | |
| Gains (losses) on: | | | | | | | | |||||||||||||||
| Hybrid instruments | | | Hedged items | | | Net impact | | | | |||||||||||||
| | $ | 109,192 | | | | | $ | (108,848) | | | | | $ | 344 | | | | |
| Gains (losses) on: | | | | | | | | |||||||||||||||
| Hybrid instruments | | | Hedged items | | | Net impact | | | | |||||||||||||
| | $ | (894) | | | | | $ | 894 | | | | | $ | — | | | | |
| | | December 31, 2021 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total Fair Value | | ||||||||||||
Assets: | | | | | | | | | | | | | | | | | | | | | | | | | |
Investments segregated under federal regulations and other | | | | | | | | | | | | | | | | | | | | | | | | | |
U.S. Treasuries | | | | $ | 109,747 | | | | | $ | — | | | | | $ | — | | | | | $ | 109,747 | | |
Receivables from brokers, dealers, clearing organizations and clearing agents | | | | | | | | | | | | | | | | | | | | | | | | | |
U.S. Treasuries | | | | | 24,699 | | | | | | — | | | | | | — | | | | | | 24,699 | | |
Stablecoin assets | | | | | 1,245 | | | | | | — | | | | | | — | | | | | | 1,245 | | |
Pledged stablecoin assets | | | | | 137,450 | | | | | | — | | | | | | — | | | | | | 137,450 | | |
Other assets(1) | | | | | 2,162 | | | | | | — | | | | | | — | | | | | | 2,162 | | |
Total financial assets measured at fair value | | | | $ | 275,303 | | | | | $ | — | | | | | $ | — | | | | | $ | 275,303 | | |
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | |
Stablecoin payables to customers | | | | $ | 102,701 | | | | | $ | — | | | | | $ | — | | | | | $ | 102,701 | | |
Total financial liabilities measured at fair value | | | | $ | 102,701 | | | | | $ | — | | | | | $ | — | | | | | $ | 102,701 | | |
| | | March 31, 2021 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total Fair Value | | ||||||||||||
Assets: | | | | | | | | | | | | | | | | | | | | | | | | | |
Investments segregated under federal regulations and other | | | | | | | | | | | | | | | | | | | | | | | | | |
U.S. Treasuries | | | | $ | 69,997 | | | | | $ | — | | | | | $ | — | | | | | $ | 69,997 | | |
Receivables from brokers, dealers, clearing organizations and clearing agents | | | | | | | | | | | | | | | | | | | | | | | | | |
U.S. Treasuries | | | | | 20,000 | | | | | | — | | | | | | — | | | | | | 20,000 | | |
Stablecoin assets | | | | | 1,050 | | | | | | — | | | | | | — | | | | | | 1,050 | | |
Pledged stablecoin assets | | | | | 94,750 | | | | | | — | | | | | | — | | | | | | 94,750 | | |
Other assets(1) | | | | | 1,766 | | | | | | — | | | | | | 866 | | | | | | 2,632 | | |
Total financial assets measured at fair value | | | | $ | 187,563 | | | | | $ | — | | | | | $ | 866 | | | | | $ | 188,429 | | |
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | |
Stablecoin payables to customers | | | | $ | 14,708 | | | | | $ | — | | | | | $ | — | | | | | $ | 14,708 | | |
Other liabilities | | | | | — | | | | | | 169 | | | | | | — | | | | | | 169 | | |
Total financial liabilities measured at fair value | | | | $ | 14,708 | | | | | $ | 169 | | | | | $ | — | | | | | $ | 14,877 | | |
| | | December 31, 2021 | | |||||||||||||||||||||||||||
| | | Gross amounts recognized as assets/liabilities | | | Gross amounts offset in the consolidated statements of financial condition | | | Net amounts presented in the consolidated statements of financial condition | | | Gross amounts not offset in the consolidated statements of financial condition Collateral received or pledged (including cash) | | | Net amount | | |||||||||||||||
Assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Securities borrowed(1) | | | | $ | 572,840 | | | | | $ | — | | | | | $ | 572,840 | | | | | $ | (532,507) | | | | | $ | 40,333 | | |
Pledged stablecoin assets(3) | | | | | 137,450 | | | | | | — | | | | | | 137,450 | | | | | | (137,450) | | | | | | — | | |
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Securities loaned(2) | | | | $ | 601,575 | | | | | $ | — | | | | | $ | 601,575 | | | | | $ | (559,295) | | | | | $ | 42,280 | | |
| | | March 31, 2021 | | |||||||||||||||||||||||||||
| | | Gross amounts recognized as assets/liabilities | | | Gross amounts offset in the consolidated statements of financial condition | | | Net amounts presented in the consolidated statements of financial condition | | | Gross amounts not offset in the consolidated statements of financial condition Collateral received or pledged (including cash) | | | Net amount | | |||||||||||||||
Assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Securities borrowed(1) | | | | $ | 335,057 | | | | | $ | — | | | | | $ | 335,057 | | | | | $ | (323,790) | | | | | $ | 11,267 | | |
Pledged stablecoin assets(3) | | | | | 94,750 | | | | | | — | | | | | | 94,750 | | | | | | (94,750) | | | | | | — | | |
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Securities loaned(2) | | | | $ | 531,818 | | | | | $ | — | | | | | $ | 531,818 | | | | | $ | (511,569) | | | | | $ | 20,249 | | |
| | | March 31, | | |||||||||||||||
| | | 2022 | | | 2021 | | | 2020 | | |||||||||
Current | | | | | | | | | | | | | | | | | | | |
Federal | | | | $ | 401 | | | | | $ | 1,944 | | | | | $ | 8 | | |
State | | | | | 827 | | | | | | 1,427 | | | | | | 86 | | |
Foreign | | | | | 1,526 | | | | | | 1,569 | | | | | | 30 | | |
Total current | | | | | 2,754 | | | | | | 4,940 | | | | | | 124 | | |
Deferred | | | | | | | | | | | | | | | | | | | |
Federal | | | | | (10,128) | | | | | | 3,788 | | | | | | 1,653 | | |
State | | | | | (32) | | | | | | 115 | | | | | | 387 | | |
Foreign | | | | | — | | | | | | — | | | | | | — | | |
Total deferred | | | | | (10,160) | | | | | | 3,903 | | | | | | 2,040 | | |
Total income tax expense (benefit) | | | | $ | (7,406) | | | | | $ | 8,843 | | | | | $ | 2,164 | | |
| | | March 31, | | |||||||||||||||
| | | 2022 | | | 2021 | | | 2020 | | |||||||||
Domestic | | | | $ | (48,281) | | | | | $ | 25,001 | | | | | $ | 9,225 | | |
Foreign | | | | | 9,179 | | | | | | 7,632 | | | | | | 3,216 | | |
Income before income taxes | | | | $ | (39,102) | | | | | $ | 32,633 | | | | | $ | 12,441 | | |
| | | March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
Deferred income tax assets: | | | | | | | | | | | | | |
Net operating loss carryforward | | | | $ | 10,863 | | | | | $ | 479 | | |
Tax credit carryforward | | | | | 3,097 | | | | | | 2,209 | | |
Lease liability | | | | | 3,963 | | | | | | 4,096 | | |
Cryptocurrency payables to customers | | | | | 42,332 | | | | | | 34,224 | | |
Cryptocurrency collateral received | | | | | 56,374 | | | | | | 46,656 | | |
Accrued liabilities and deferred income | | | | | 5,235 | | | | | | 3,706 | | |
Other | | | | | 364 | | | | | | 358 | | |
Valuation allowance | | | | | (763) | | | | | | (669) | | |
Deferred income tax assets | | | | | 121,465 | | | | | | 91,059 | | |
| | | March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
Deferred income tax liabilities: | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 26,094 | | | | | | 25,065 | | |
Right-of-use asset | | | | | 3,391 | | | | | | 3,115 | | |
Cryptocurrency assets | | | | | 98,354 | | | | | | 80,550 | | |
Unrealized losses | | | | | 1,585 | | | | | | — | | |
Other | | | | | — | | | | | | 453 | | |
Deferred income tax liabilities | | | | | 129,424 | | | | | | 109,183 | | |
Net deferred income tax liabilities | | | | $ | 7,959 | | | | | $ | 18,124 | | |
|
| | | March 31, | | |||||||||||||||
| | | 2022 | | | 2021 | | | 2020 | | |||||||||
Federal statutory rate | | | | | 21.0% | | | | | | 21.0% | | | | | | 21.0% | | |
Foreign Rate Differential | | | | | 0.6 | | | | | | (0.6) | | | | | | (1.6) | | |
State and local income taxes, net of federal tax benefits | | | | | 4.2 | | | | | | 3.5 | | | | | | 4.1 | | |
Tax credits generated, net of expirations | | | | | 1.6 | | | | | | (2.5) | | | | | | (3.1) | | |
Impact of state rate changes | | | | | (2.8) | | | | | | 0.6 | | | | | | (1.7) | | |
Nondeductible expenses | | | | | 2.8 | | | | | | 0.6 | | | | | | 1.3 | | |
Uncertain tax benefits | | | | | (5.1) | | | | | | 0.3 | | | | | | (5.1) | | |
Valuation allowance | | | | | (0.2) | | | | | | 0.5 | | | | | | (1.6) | | |
Foreign Taxes less US Deduction | | | | | (3.9) | | | | | | 3.8 | | | | | | 0.2 | | |
Global Intangible Low-Taxed Income | | | | | (0.7) | | | | | | 0.7 | | | | | | 1.9 | | |
Other | | | | | 1.5 | | | | | | (0.8) | | | | | | 2.0 | | |
| | | | | 19.0% | | | | | | 27.1% | | | | | | 17.4% | | |
| | | March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
Beginning balance | | | | $ | 242 | | | | | $ | 168 | | |
Increases related to tax positions taken during a prior period | | | | | 16 | | | | | | 15 | | |
Increases related to tax positions taken during the current period | | | | | 1,766 | | | | | | 59 | | |
Decreases as a result of a lapse of the applicable statute of limitations | | | | | — | | | | | | — | | |
Decreases related to tax positions taken during a prior period | | | | | (2) | | | | | | — | | |
Ending balance | | | | $ | 2,022 | | | | | $ | 242 | | |
Year Ended March 31, | | | | | | | |
2023 | | | | $ | 2,608 | | |
2024 | | | | | 2,520 | | |
2025 | | | | | 2,393 | | |
2026 | | | | | 2,023 | | |
2027 | | | | | 1,704 | | |
Thereafter | | | | | 6,809 | | |
Total undiscounted lease payments | | | | | 18,057 | | |
Less: imputed interest | | | | | (1,386) | | |
Present value of lease liabilities | | | | $ | 16,671 | | |
| | Nine Months Ended December 31, | | | Year Ended March 31, | | ||||||||||||||||||||||||||
| | 2021 | | 2020 | | | 2022 | | 2021 | | 2020 | | ||||||||||||||||||||
Revenues: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||
Trading-related revenue(1) | | | $ | 2,854 | | | | $ | 4,782 | | | | | $ | 3,919 | | | | $ | 7,853 | | | | $ | 2,152 | | | |||||
Subscription and other revenue(2) | | | | 2,494 | | | | | 2,663 | | | | | | 3,433 | | | | | 3,675 | | | | | 5,153 | | | |||||
Expenses: | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||
Interest expense on borrowings(4) | | | | 2,228 | | | | | 2,128 | | | | | 4,409 | | | ||||||||||||||||
Professional services(3) | | | $ | 105 | | | | $ | 105 | | | | | $ | 140 | | | | $ | 140 | | | | $ | 148 | | |
| | | | | | | | | | | | |||||||||||||||
| | December 31, 2021 | | March 31, 2021 | | | March 31, 2022 | | March 31, 2021 | | ||||||||||||||||
Assets: | | | | | | | | | | | | | | | | | | | | | | | ||||
Due from affiliated companies(4) | | | $ | 551 | | | | $ | 1,630 | | | |||||||||||||||
Due from affiliated companies(5) | | | $ | 1,269 | | | | $ | 1,630 | | | |||||||||||||||
Liabilities: | | | | | | | | | | | | | | | | | | | | | | | ||||
Note payable(5) | | | $ | 178,000 | | | | $ | 123,000 | | | |||||||||||||||
Due to affiliated companies(6) | | | | 495 | | | | | 413 | | | |||||||||||||||
Note Payable(6) | | | $ | 178,000 | | | | $ | 123,000 | | | |||||||||||||||
Due to affiliated companies(7) | | | | 506 | | | | | 413 | | |
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| Exhibit A | | | | | — | | | | Sponsor Support Agreement | |
| Exhibit B | | | | | — | | | | Form of Amended and Restated Company Charter | |
| Exhibit C | | | | | — | | | | Form of Amended and Restated Company Bylaws | |
| Exhibit D | | | | | — | | | | Form of Registration Rights Agreement | |
| Exhibit E | | | | | — | | | | Form of Certificate of Merger | |
| Exhibit F | | | | | — | | | | Form of Incentive Equity Plan | |
| Annex A | | | | | — | | | | Pre-Closing Restructuring Plan | |
Email: | mwolfson@stblaw.com; | rpurushotham@stblaw.com |
Email: | mwolfson@stblaw.com; | rpurushotham@stblaw.com |
| | | | SPONSORS: | | |||
| | | | QUANTUM VENTURES LLC | | |||
| | | | By: | | | Name: Title: | |
| | | | CHARDAN QUANTUM LLC | | |||
| | | | By: | | | Name: Title: | |
| | | | Name: John Schaible | | |||
| | | | Name: Miguel Leon | | |||
| | | | Name: Daniel Caamano, V | | |||
| | | | Name: Sandip I. Patel | | |||
| | | | Name: Thomas J. Hammond | | |||
| | | | Name: Richard Korhammer | | |||
| | | | Name: Steven J. Carlson | |
| | | | QUANTUM: | | |||
| | | | QUANTUM FINTECH ACQUISITION CORPORATION | | |||
| | | | By: | | | Name: Title: | |
| | | | COMPANY: | | |||
| | | | TRADESTATION GROUP, INC. | | |||
| | | | By: | | | Name: Title: | |
| | | | MONEX: | | |||
| | | | MONEX GROUP, INC. | | |||
| | | | By: | | | Name: Title: | |
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By: | |
By: | |
By: | |
By: | |
Name: | | | State of Incorporation: | |
Quantum FinTech Acquisition Corporation | | | Delaware | |
TSG Merger Sub, Inc. | | | Delaware | |
| Exhibit Number | | | Description | | | Incorporated by Reference | | |||||||||
| Form | | | File No. | | | Exhibits | | | Filing Date | | ||||||
| 2.1† | | | Agreement and Plan of Merger, dated as of November 4, 2021, by and among Quantum FinTech Acquisition Corporation, TradeStation Group, Inc., and TSG Merger Sub, Inc. (included as Annex A-1 to the proxy statement/prospectus) | | | | | | | | | | | | | |
| 2.2^ | | | First Amendment to the Agreement and Plan of Merger, dated as of December 17, 2021, by and among Quantum FinTech Acquisition Corporation, TradeStation Group, Inc., and TSG Merger Sub, Inc. (included as Annex A-2 to the proxy statement/prospectus) | | | | | | | | | | | | | |
| | | | Second Amendment to the Agreement and Plan of Merger, dated as of April 28, 2022, by and among Quantum Fintech Acquisition Corporation, TradeStation Group, Inc., and TSG Merger Sub, Inc. (included as Annex A-3to the proxy statement/prospectus) | | | | | | | | | | | | | |
| 3.1^ | | | | | | | | | | | | | | | | |
| 3.2^ | | | | | | | | | | | | | | | | |
| 3.3^ | | | | | | | | | | | | | | | | |
| 3.4^ | | | | | 8-K | | | 001-40009 | | | 3.1 | | | February 10, 2021 | | |
| 3.5^ | | | | | S-1 | | | 333-252226 | | | 3.3 | | | January 19, 2021 | | |
| 4.1^ | | | | | S-1/A | | | 333-252226 | | | 4.1 | | | January 29, 2021 | |
| Exhibit Number | | | Description | | | Incorporated by Reference | | |||||||||
| Form | | | File No. | | | Exhibits | | | Filing Date | | ||||||
| 4.2^ | | | | | S-1/A | | | 333-252226 | | | 4.2 | | | January 29, 2021 | | |
| 4.3^ | | | | | S-1/A | | | 333-252226 | | | 4.3 | | | January 29, 2021 | | |
| 4.4^ | | | | | 8-K | | | 001-40009 | | | 4.1 | | | February 10, 2021 | | |
| 4.5** | | | Specimen Common Stock Certificate of TradeStation Group, Inc. | | | | | | | | | | | | | |
| 4.6^ | | | Registration and Stockholder Rights Agreement, dated February 4, 2021, among Quantum FinTech Acquisition Corporation, Continental Stock Transfer & Trust Company, Quantum Ventures LLC, Chardan Quantum LLC and each of the executive officers and directors of Quantum FinTech Acquisition Corporation | | | 8-K | | | 001-40009 | | | 10.5 | | | February 10, 2021 | |
| 4.7^ | | | | | 8-K | | | 001-40009 | | | 10.1 | | | February 10, 2021 | | |
| 4.8^ | | | | | 8-K | | | 001-40009 | | | 10.2 | | | February 10, 2021 | | |
| 4.9^ | | | Form of Registration Rights Agreement, to be effective upon the consummation of the Merger, by and among, TradeStation Group, Inc., Quantum Ventures LLC, Chardan Quantum LLC, Monex Group, Inc. and the other parties named therein | | | | | | | | | | | | | |
| 4.10^ | | | | | 10-K/A | | | 001-40009 | | | 10.14 | | | April 28, 2022 | | |
| 5.1** | | | Opinion of Bilzin Sumberg Baena Price & Axelrod LLP | | | | | | | | | | | | | |
| 5.2** | | | Opinion of Simpson Thacher & Bartlett LLP | | | | | | | | | | | | | |
| Exhibit Number | | | Description | | | Incorporated by Reference | | |||||||||
| Form | | | File No. | | | Exhibits | | | Filing Date | | ||||||
| 10.1^ | | | | | 8-K | | | 001-40009 | | | 10.3 | | | February 10, 2021 | | |
| 10.2^ | | | | | 8-K/A | | | 001-40009 | | | 10.2 | | | November 10, 2021 | | |
| 10.3^ | | | | | 8-K/A | | | 001-40009 | | | 10.3 | | | November 10, 2021 | | |
| 10.4^ | | | | | 8-K/A | | | 001-40009 | | | 10.1 | | | November 10, 2021 | | |
| 10.5^†† | | | | | | | | | | | | | | | | |
| 10.6** | | | Form of Indemnity Agreement | | | | | | | | | | | | | |
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| | | Master Promissory Note, dated as of March 31, 2022, given by TradeStation Group, Inc. in favor of MUFG Bank, Ltd. | | | | | | | | | | | | | |
| Exhibit Number | | | Description | | | Incorporated by Reference | | |||||||||
| Form | | | File No. | | | Exhibits | | | Filing Date | | ||||||
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| | | Clarification Letter to Second Amended and Restated Executive Agreement, dated October 19, 2021, by and between Greg Vance and TradeStation Group, Inc., dated December 13, 2021 | | | | | | |||||||||
| | | Clarification Letter to Second Amended and Restated Executive Agreement, dated October 19, 2021, by and between John Bartleman and TradeStation Group, Inc., dated December 13, 2021 | | | | | | |||||||||
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| | | Letter Agreement, dated April 28, 2022 delivered by Quantum Ventures LLC and Chardan Quantum LLC, to TradeStation Group, Inc. and Quantum FinTech Acquisition Corporation | | | | | | | | | | | | | | |
| | | Commitment Letter by Monex Group, Inc. to TradeStation Group, Inc., dated March 31, 2022 | | | | | | | | | | | | |||
| 21.1^ | | | | | | | | | | | | | | | | |
| 23.1* | | | | | | | | | | | | | | | | |
| 23.2* | | | | | | | | | | | | | | | | |
| 23.3** | | | Consent of Bilzin Sumberg Baena Price & Axelrod LLP (included as part of Exhibit 5.1) | | | | | | | | | | | | | |
| 23.4** | | | Consent of Simpson Thacher & Bartlett LLP (included as part of Exhibit 5.2) | | | | | | | | | | | | | |
| 24.1^ | | | | | | | | | | | | | | | | |
| 99.1** | | | Form of Proxy for the Special Meeting | | | | | | | | | | | | | |
| 99.2^ | | | | | | | | | | | | | | | | |
| 99.3^ | | | | | | | | | | | | | | | | |
| 99.4^ | | | | | | | | | | | | | | | | |
| 99.5^ | | | | | | | | | | | | | | | |
| Exhibit Number | | | Description | | | Incorporated by Reference | | |||||||||
| Form | | | File No. | | | Exhibits | | | Filing Date | | ||||||
| 99.6^ | | | | | | | | | | | | | | | | |
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| | | | TRADESTATION GROUP, INC. | | |||
| | | | By: | | | /s/ John Bartleman | |
| | | | | | | Name: John Bartleman | |
| | | | | | | Title: President and Chief Executive Officer | |
| Signature | | | Title | | | Date | |
| /s/ John Bartleman John Bartleman | | | President, Chief Executive Officer (Principal Executive Officer); Director | | | | |
| * Oki Matsumoto | | | Director | | | | |
| * Takashi Oyagi | | | Chief Strategic Officer; Director | | | | |
| /s/ Marc Stone Marc Stone | | | Chief Legal Officer; Director | | | | |
| /s/ Greg Vance Greg Vance | | | Chief Financial Officer | | | | |
| * Yuko Seimei | | | Director | | | | |
| * Akira Inoue | | | Director | | | | |
| * Jun Makihara | | | Director | | | | |
| *By: /s/ Marc Stone Name: Marc Stone Title: Attorney-in-Fact | | | Attorney-In-Fact | | | |