Filing summary
Important entity note: The supplied filing is for Colonnade Acquisition Corp., a blank-check company, not Ouster, Inc. The figures and disclosures below describe Colonnade and should not be attributed to Ouster.
Business context and reporting period
This unaudited Form 10-Q covers the quarter ended September 30, 2020. Colonnade was formed on June 4, 2020 to pursue a business combination and had not begun operating activities. It said it intended to focus on natural resources, energy, real estate and agriculture. Its IPO closed August 25, 2020.
Financial results and liquidity
- Revenue: No operating revenue. Management said operating revenue was not expected before a business combination.
- Quarterly result: Net loss of $54,514 for the three months ended September 30, 2020; operating costs were $56,266. Trust-account interest of $15,961, less an unrealized investment loss of $14,209, produced net other income of $1,752. Basic and diluted loss per share was $0.01.
- Since inception: Net loss of $59,514 from June 4 through September 30, 2020. The filing provides no comparable prior-year period.
- Assets and liquidity at September 30: Cash outside the trust was $1,097,447; prepaid expenses were $368,756; trust-account marketable securities were $200,001,752. Current liabilities were $100,100, including $85,100 of accrued offering costs. Total liabilities were $7,100,100, including a $7 million deferred underwriting fee payable upon a completed business combination.
- Equity and redeemable shares: Class A shares subject to possible redemption were presented as temporary equity at $189,367,849. Shareholders’ equity was $5,000,006.
- Cash flow: Cash used in operating activities was $415,022 from inception through September 30; investing cash outflow was $200 million, reflecting funding of the trust; financing provided $201,512,469. Ending cash was $1,097,447.
- Debt and margins: The company reported no long-term debt and had no operating revenue, so operating margins are not applicable.
Material changes and unusual items
- The IPO raised $200 million from 20 million units at $10 per unit; a concurrent private placement raised $6 million. Colonnade placed $200 million in its trust account. Transaction costs totaled $11,597,631, including $7 million deferred underwriting fees.
- On October 9, 2020, the underwriters’ over-allotment option expired unexercised, resulting in the forfeiture of 750,000 founder shares; 5 million founder shares remained outstanding after that date.
- On November 13, 2020, the board approved changes to the chairs of the Audit and Compensation Committees.
Outlook, risks and contingencies
- Colonnade had until August 25, 2022 to complete a business combination. It stated there was no assurance it would find or complete a transaction and expected to continue incurring search and public-company costs.
- Management said it did not believe additional funding would be needed for planned expenditures, but warned that higher-than-expected search and diligence costs, redemption levels, or transaction financing needs could require additional financing. The $1,097,447 outside the trust was intended primarily for target search and transaction expenses.
- If no combination is completed by the deadline, public shares are generally to be redeemed from the trust, subject to the stated terms and creditor claims. Public warrants could expire worthless.
- The filing identified the possibility that negative interest rates on trust investments could reduce public shareholders’ per-share redemption amount below $10. The trust held U.S. government securities or qualifying money-market investments; the filing reported no legal proceedings.
- The Sponsor agreed to limited indemnification for certain third-party claims that reduce trust funds, subject to exclusions and limitations described in the filing.
Important facts for investors to verify
- Confirm the registrant: this filing is Colonnade Acquisition Corp., not Ouster, Inc.
- Review the trust balance, redemption terms, and the August 25, 2022 business-combination deadline.
- Check the consequences of the expired over-allotment option and the resulting founder-share forfeiture.
- Review potential financing, redemption, trust-asset, and sponsor-indemnity risks before assessing the SPAC’s ability to complete a transaction.