Filing summary
Entity warning: The supplied filing is for Landcadia Holdings III, Inc., a blank-check company, not Hillman Solutions Corp. The summary below reflects the filing text and should not be treated as a Hillman financial summary.
Business context and reporting period
This unaudited Form 10-Q covers the quarter and nine months ended September 30, 2020. Landcadia reported no significant operations and had not identified a business-combination target by quarter-end. It completed its initial public offering after the reporting period, on October 14, 2020.
Financial position and results
- At September 30, 2020, total assets and total liabilities were each $377,200, consisting principally of deferred offering costs, accounts payable of $215,450, and affiliate notes payable of $161,750. Stockholders’ equity was reported as zero.
- Cash and current assets were zero. The company reported no revenue, expenses, net income or loss, or income-tax provision for the three- and nine-month periods presented. Earnings per share was zero.
- Operating, investing, and financing cash flows were each reported as zero for the nine months ended September 30, 2020; cash at period-end was zero.
- No debt, capital or operating lease obligations, off-balance-sheet arrangements, or market-risk exposure were reported at quarter-end. The affiliate notes were repaid in full by October 16, 2020.
Changes, outlook, and risks
- Compared with December 31, 2019, assets and liabilities increased from zero to $377,200, largely reflecting costs and payables incurred in preparing the offering. Class B shares outstanding rose from 6,943,125 to 14,375,000 following a founder-share transaction and stock split.
- On October 14, 2020, the company sold 50 million units at $10 each, raising $500 million gross, and issued 8 million private-placement warrants for $12 million. It placed $500 million in a trust account; the filing says the remaining funds outside the trust were used for underwriting commissions, sponsor-loan repayment, and offering and formation costs.
- Management intended to use substantially all trust proceeds toward a business combination and stated it was searching for suitable targets. The company had 24 months from the offering close, through October 14, 2022, to complete a combination or redeem public shares and liquidate. Completion was not assured.
- Public shareholders may have redemption rights subject to the charter and a $5,000,001 minimum-net-tangible-assets condition. The filing identifies possible negative interest rates on trust investments as a risk that could reduce redemption proceeds below $10 per share. Other risk factors were referred to in the IPO prospectus; management reported no material changes to those factors other than the negative-rate risk.
- Related-party arrangements include administrative services of up to $20,000 per month and potential $100,000 payments to each independent director upon a business-combination closing. The underwriter’s $17.5 million deferred commission is payable only if a business combination is completed.
- Management concluded disclosure controls were effective as of September 30, 2020. No legal proceedings were reported.
Important facts to verify
- Confirm the intended issuer: this filing names Landcadia Holdings III, Inc., not Hillman Solutions Corp.
- Verify the post-quarter IPO and trust-account amounts, including the treatment of underwriting commissions and other outside-trust funds.
- Review the IPO prospectus and subsequent filings for target-search developments, redemption terms, and updated risk factors.
- Check whether the underwriters exercised the 45-day over-allotment option and whether any later transactions changed the share or warrant counts.