Company Quick10K Filing
Gores Metropoulos
Price1.00 EPS-4,239,658
Shares-0 P/E-0
MCap-0 P/FCF-0
Net Debt-1 EBIT5
TEV-1 TEV/EBIT-0
TTM 2019-09-30, in MM, except price, ratios
S-1 2020-12-23 Public Filing
10-Q 2020-09-30 Filed 2020-11-06
10-Q 2020-06-30 Filed 2020-08-06
10-Q 2020-03-31 Filed 2020-05-08
10-K 2019-12-31 Filed 2020-03-13
10-Q 2019-09-30 Filed 2019-11-08
10-Q 2019-06-30 Filed 2019-08-09
10-Q 2019-03-31 Filed 2019-05-06
10-K 2018-12-31 Filed 2019-03-29
8-K 2021-02-08 Officers, Regulation FD, Exhibits
8-K 2021-02-03 Other Events, Exhibits
8-K 2020-12-16 Regulation FD, Exhibits
8-K 2020-12-02 Enter Agreement, M&A, Sale of Shares, Shareholder Rights, Accountant, Control, Officers, Shell Status, Exhibits
8-K 2020-12-01 Shareholder Vote, Other Events
8-K 2020-11-24
8-K 2020-11-20
8-K 2020-11-10
8-K 2020-11-06
8-K 2020-10-30
8-K 2020-10-07
8-K 2020-08-24
8-K 2019-03-22
8-K 2019-02-05
8-K 2019-01-31

GMHI 10Q Quarterly Report

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II - Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
EX-31.1 gmhi-ex311_8.htm
EX-31.2 gmhi-ex312_7.htm
EX-32.1 gmhi-ex321_9.htm
EX-32.2 gmhi-ex322_6.htm

Gores Metropoulos Earnings 2020-09-30

Balance SheetIncome StatementCash Flow

gmhi-10q_20200930.htm
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2020

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM         TO        

Commission File Number: 001-38791

 

GORES METROPOULOS, INC.

(Exact name of registrant as specified in its Charter)

 

 

Delaware

 

83-1804317

(State or other jurisdiction of

 

(I.R.S. Employer

incorporation or organization)

 

Identification No.)

 

 

 

9800 Wilshire Blvd.

 

 

Beverly Hills, CA

 

90212

(Address of principal executive offices)

 

(Zip Code)

 

(310) 209-3010

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

 

Trading Symbols

 

Name of each exchange on which registered

Class A Common Stock

 

GMHI

 

Nasdaq Capital Market

Warrants

 

GMHIW

 

Nasdaq Capital Market

Units

 

GMHIU

 

Nasdaq Capital Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  NO 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  NO 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definition of “large accelerated filer”, “accelerated filer”, “smaller reporting company,” and “emerging growth company” in Rule 12b‑2 of the Exchange Act.

 

Large accelerated filer

 

Accelerated filer

Non-accelerated filer

 

Smaller reporting company

Emerging growth company

 

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b‑2 of the Exchange Act). YES  NO 

As of November 6, 2020, there were 40,000,000 shares of the Company’s Class A common stock, par value $0.0001 per share, and 10,000,000 shares of the Company’s Class F common stock, par value $0.0001 per share, issued and outstanding.

 

 



 

TABLE OF CONTENTS

 

 

Page

PART I—FINANCIAL INFORMATION

 

 

 

 

Item 1.

Financial Statements

 

 

 

 

Consolidated Balance Sheets (Unaudited)

3

 

 

Consolidated Statements of Operations (Unaudited)

4

 

 

Consolidated Statements of Changes in Stockholders’ Equity (Unaudited)

5

 

 

Consolidated Statements of Cash Flows (Unaudited)

6

 

 

Notes to Unaudited, Interim Consolidated Financial Statements (Unaudited)

7

 

 

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

19

 

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

23

 

 

 

Item 4.

Controls and Procedures

23

 

 

PART II—OTHER INFORMATION

25

 

 

 

Item 1.

Legal Proceedings

25

 

 

 

Item 1A.

Risk Factors

25

 

 

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

25

 

 

 

Item 3.

Defaults Upon Senior Securities

26

 

 

 

Item 4.

Mine Safety Disclosures

26

 

 

 

Item 5.

Other Information

26

 

 

 

Item 6.

Exhibits

27

 

 

2


 

GORES METROPOULOS, INC.

CONSOLIDATED BALANCE SHEETS

 

 

 

September 30, 2020

 

 

December 31, 2019

 

 

 

(unaudited)

 

 

(audited)

 

CURRENT ASSETS:

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

 

518,874

 

 

$

 

1,365,240

 

Prepaid assets

 

 

 

59,460

 

 

 

 

136,399

 

        Total current assets

 

 

 

578,334

 

 

 

 

1,501,639

 

Deferred income tax

 

 

 

 

 

 

 

2,353

 

Investments and cash held in Trust Account

 

 

 

405,725,195

 

 

 

 

406,434,959

 

        Total assets

 

$

 

406,303,529

 

 

$

 

407,938,951

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

 

 

Accrued expenses, formation and offering costs

 

$

 

2,935,896

 

 

$

 

53,203

 

State franchise tax accrual

 

 

 

30,000

 

 

 

 

200,000

 

     Current income tax and interest payable

 

 

 

133,004

 

 

 

 

1,102,662

 

        Total current liabilities

 

 

 

3,098,900

 

 

 

 

1,355,865

 

Deferred underwriting compensation

 

 

 

14,000,000

 

 

 

 

14,000,000

 

        Total liabilities

 

$

 

17,098,900

 

 

$

 

15,355,865

 

 

 

 

 

 

 

 

 

 

 

 

Commitments and Contingencies:

 

 

 

 

 

 

 

 

 

 

Class A Common Stock subject to possible redemption, 38,420,462 and 38,713,476 shares at September 30, 2020 and December 31, 2019, respectively (at redemption value of $10 per share)

 

 

 

384,204,620

 

 

 

 

387,134,760

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

 

 

 

 

Preferred stock, $0.0001 par value; 1,000,000 shares authorized, none issued or outstanding

 

 

 

 

 

 

 

 

Common stock

 

 

 

 

 

 

 

 

 

 

Class A Common Stock, $0.0001 par value; 200,000,000 shares authorized, 1,579,538 and 1,286,524 shares issued and outstanding (excluding 38,420,462 and 38,713,476 shares subject to possible redemption) at September 30, 2020 and December 31, 2019, respectively

 

 

 

158

 

 

 

 

129

 

Class F Common Stock, $0.0001 par value; 20,000,000 shares authorized, 10,000,000 and 10,000,000 shares issued and outstanding at September 30, 2020 and December 31, 2019, respectively

 

 

 

1,000

 

 

 

 

1,000

 

Additional paid-in capital

 

 

 

2,954,117

 

 

 

 

24,006

 

Retained earnings

 

 

 

2,044,734

 

 

 

 

5,423,191

 

 

 

 

 

 

 

 

 

 

 

 

        Total stockholders’ equity

 

 

 

5,000,009

 

 

 

 

5,448,326

 

 

 

 

 

 

 

 

 

 

 

 

        Total liabilities and stockholders’ equity

 

$

 

406,303,529

 

 

$

 

407,938,951

 

 

See accompanying notes to the unaudited, interim, consolidated financial statements.

3


 

GORES METROPOULOS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

 

Three Months Ended

Three Months Ended

 

 

Nine Months Ended

 

 

Nine Months Ended

 

 

 

September 30, 2020

September 30, 2019

 

 

September 30, 2020

 

 

September 30, 2019

 

Revenues

$

 

 

 

$

 

 

 

$

 

 

 

$

 

 

Professional fees and other expenses

 

 

(4,049,658

)

 

 

 

(150,796

)

 

 

 

(4,408,626

)

 

 

 

(460,780

)

State franchise taxes, other than income tax

 

 

(50,000

)

 

 

 

(50,000

)

 

 

 

(150,000

)

 

 

 

(150,000

)

   Net loss from operations

 

 

(4,099,658

)

 

 

 

(200,796

)

 

 

 

(4,558,626

)

 

 

 

(610,780

)

Other income - interest income

 

 

26,672

 

 

 

 

2,112,905

 

 

 

 

1,351,950

 

 

 

 

6,005,266

 

   Net income/(loss) before income taxes

$

 

(4,072,986

)

 

$

 

1,912,109

 

 

$

 

(3,206,676

)

 

$

 

5,394,486

 

Income tax provision and interest

 

 

46,571

 

 

 

 

(405,292

)

 

 

 

(171,781

)

 

 

 

(1,132,843

)

   Net income/(loss) attributable to common shares

$

 

(4,026,415

)

 

$

 

1,506,817

 

 

$

 

(3,378,457

)

 

$

 

4,261,643

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income/(loss) per ordinary share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

       Class A ordinary shares - basic and diluted

$

 

(0.08

)

 

$

 

0.04

 

 

$

 

(0.06

)

 

$

 

0.13

 

       Class F ordinary shares - basic and diluted

$

 

(0.08

)

 

$

 

(0.01

)

 

$

 

(0.09

)

 

$

 

(0.04

)

 

See accompanying notes to the unaudited, interim, consolidated financial statements.

 

 

4


 

GORES METROPOULOS, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(Unaudited)

 

 

 

Three Months Ended September 30, 2019

 

 

 

Class A Common Stock

 

 

Class F Common Stock

 

 

Additional

 

 

Retained

 

 

Stockholders'

 

 

 

Shares

 

 

Amount

 

 

 

Shares

 

 

Amount

 

 

Paid-In Capital

 

 

Earnings

 

 

Equity

 

Beginning Balance at July 1, 2019

 

 

1,510,727

 

 

$

 

151

 

 

 

 

10,000,000

 

 

$

 

1,000

 

 

$

 

2,266,014

 

 

$

 

2,732,841

 

 

$

 

5,000,006

 

Class A common stock subject to possible redemption; 38,639,955 shares at a redemption price of $10.00

 

 

(150,682

)

 

 

 

(15

)

 

 

 

-

 

 

 

 

-

 

 

 

 

(1,506,805

)

 

 

 

-

 

 

 

 

(1,506,820

)

Net income

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

1,506,817

 

 

 

 

1,506,817

 

Balance at September 30, 2019

 

 

1,360,045

 

 

$

 

136

 

 

 

 

10,000,000

 

 

$

 

1,000

 

 

$

 

759,209

 

 

$

 

4,239,658

 

 

$

 

5,000,003

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended September 30, 2019

 

 

 

Class A Common Stock

 

 

Class F Common Stock

 

 

Additional

 

 

Retained Earnings/

 

 

Stockholders'

 

 

 

Shares

 

 

Amount

 

 

 

Shares

 

 

Amount

 

 

Paid-In Capital

 

 

(Acc. Deficit)

 

 

Equity

 

Beginning Balance at January 1, 2019

 

 

-

 

 

$

 

-

 

 

 

 

10,781,250

 

 

$

 

1,078

 

 

$

 

23,922

 

 

$

 

(21,985

)

 

$

 

3,015

 

Forfeited Class F Common stock by Sponsor

 

 

-

 

 

 

 

-

 

 

 

 

(781,250

)

 

 

 

(78

)

 

 

 

78

 

 

 

 

-

 

 

 

 

-

 

Proceeds from initial public offering of Units on February 5, 2019 at $10.00 per Unit

 

 

40,000,000

 

 

 

 

4,000

 

 

 

 

-

 

 

 

 

-

 

 

 

 

399,996,000

 

 

 

 

-

 

 

 

 

400,000,000

 

Sale of 6,666,666 Private Placement Warrants to Sponsor on February 5, 2019 at $1.50 per Private Placement Warrant

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

10,000,000

 

 

 

 

-

 

 

 

 

10,000,000

 

Underwriters discounts

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

(8,000,000

)

 

 

 

-

 

 

 

 

(8,000,000

)

Offering costs charged to additional paid-in capital

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

(865,105

)

 

 

 

-

 

 

 

 

(865,105

)

Deferred underwriting compensation

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

(14,000,000

)

 

 

 

-

 

 

 

 

(14,000,000

)

Class A common stock subject to possible redemption; 38,639,955 shares at a redemption price of $10.00

 

 

(38,639,955

)

 

 

 

(3,864

)

 

 

 

-

 

 

 

 

-

 

 

 

 

(386,395,686

)

 

 

 

-

 

 

 

 

(386,399,550

)

Net income

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

4,261,643

 

 

 

 

4,261,643

 

Balance at September 30, 2019

 

 

1,360,045

 

 

$

 

136

 

 

 

 

10,000,000

 

 

$

 

1,000

 

 

$

 

759,209

 

 

$

 

4,239,658

 

 

$

 

5,000,003

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended September 30, 2020

 

 

 

Class A Common Stock

 

 

Class F Common Stock

 

 

Additional

 

 

Retained

 

 

Stockholders'

 

 

 

Shares

 

 

Amount

 

 

 

Shares

 

 

Amount

 

 

Paid-In Capital

 

 

Earnings

 

 

Equity

 

Beginning Balance at July 1, 2020

 

 

1,286,524

 

 

$

 

129

 

 

 

 

10,000,000

 

 

$

 

1,000

 

 

$

 

24,006

 

 

$

 

6,071,149

 

 

$

 

6,096,284

 

Class A common stock subject to possible redemption; 38,420,462 shares at a redemption price of $10.00

 

 

293,014

 

 

 

 

29

 

 

 

 

-

 

 

 

 

-

 

 

 

 

2,930,111

 

 

 

 

-

 

 

 

 

2,930,140

 

Net loss

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

(4,026,415

)

 

 

 

(4,026,415

)

Balance at September 30, 2020

 

 

1,579,538

 

 

$

 

158

 

 

 

 

10,000,000

 

 

$

 

1,000

 

 

$

 

2,954,117

 

 

$

 

2,044,734

 

 

$

 

5,000,009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended September 30, 2020

 

 

 

Class A Common Stock

 

 

Class F Common Stock

 

 

Additional

 

 

Retained

 

 

Stockholders'

 

 

 

Shares

 

 

Amount

 

 

 

Shares

 

 

Amount

 

 

Paid-In Capital

 

 

Earnings

 

 

Equity

 

Beginning Balance at January 1, 2020

 

 

1,286,524

 

 

$

 

129

 

 

 

 

10,000,000

 

 

$

 

1,000

 

 

$

 

24,006

 

 

$

 

5,423,191

 

 

$

 

5,448,326

 

Class A common stock subject to possible redemption; 38,420,462 shares at a redemption price of $10.00

 

 

293,014

 

 

 

 

29

 

 

 

 

-

 

 

 

 

-

 

 

 

 

2,930,111

 

 

 

 

-

 

 

 

 

2,930,140

 

Net loss

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

-

 

 

 

 

(3,378,457

)

 

 

 

(3,378,457

)

Balance at September 30, 2020

 

 

1,579,538

 

 

$

 

158

 

 

 

 

10,000,000

 

 

$

 

1,000

 

 

$

 

2,954,117

 

 

$

 

2,044,734

 

 

$

 

5,000,009

 

 

See accompanying notes to the unaudited, interim, consolidated financial statements

 

 

5


 

GORES METROPOULOS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

 

 

Nine Months Ended

 

 

 

Nine Months Ended

 

 

 

 

September 30, 2020

 

 

 

September 30, 2019

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

 

 

Net income/(loss)

 

$

 

(3,378,457

)

 

$

 

4,261,643

 

Changes in state franchise tax accrual

 

 

 

(170,000

)

 

 

 

148,569

 

Changes in prepaid assets and deferred costs

 

 

 

76,939

 

 

 

 

(193,429

)

Changes in deferred offering costs

 

 

 

 

 

 

 

437,375

 

Changes in accrued expenses, formation and offering costs

 

 

 

2,882,693

 

 

 

 

(294,056

)

Changes in current income tax and interest payable

 

 

 

(969,658

)

 

 

 

497,951

 

Changes in deferred income tax

 

 

 

2,353

 

 

 

 

293,594

 

Net cash provided by/(used in) operating activities

 

 

 

(1,556,130

)

 

 

 

5,151,647

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

Cash deposited in Trust Account

 

 

 

 

 

 

 

(400,000,000

)

Interest reinvested in Trust Account

 

 

 

709,764

 

 

 

 

(4,738,939

)

Net cash provided by/(used in) investing activities

 

 

 

709,764

 

 

 

 

(404,738,939

)

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

Proceeds from sale of Units in initial public offering

 

 

 

 

 

 

 

400,000,000

 

Proceeds from sale of Private Placement Warrants to Sponsor

 

 

 

 

 

 

 

10,000,000

 

Repayment of notes and advances payable – related party

 

 

 

 

 

 

 

(150,000

)

Payment of underwriters’ discounts and commissions

 

 

 

 

 

 

 

(8,000,000

)

Payment of accrued offering costs

 

 

 

 

 

 

 

(865,105

)

Net cash provided by financing activities

 

 

 

 

 

 

 

400,984,895

 

Increase/(decrease) in cash

 

 

 

(846,366

)

 

 

 

1,397,603

 

Cash at beginning of period

 

 

 

1,365,240

 

 

 

 

52,489

 

Cash at end of period

 

$

 

518,874

 

 

$

 

1,450,092

 

Supplemental disclosure of cash and non-cash financing activities:

 

 

 

 

 

 

 

 

 

 

Deferred underwriting compensation

 

$

 

 

 

$

 

14,000,000

 

Cash paid for income and state franchise taxes

 

 

 

1,459,136

 

 

 

 

342,729

 

 

See accompanying notes to the unaudited, interim, consolidated financial statements.

6


 

GORES METROPOULOS, INC.

NOTES TO THE UNAUDITED, INTERIM CONSOLIDATED FINANCIAL STATEMENTS

1.       Organization and Business Operations

Organization and General

Gores Metropoulos, Inc. (the “Company”) was incorporated in Delaware on August 28, 2018. The Company was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar Business Combination with one or more businesses (the “Business Combination”). The Company has neither engaged in any operations nor generated any revenue to date. The Company’s Sponsor is Gores Metropoulos Sponsor, LLC, a Delaware limited liability company (the “Sponsor”). The Company has selected December 31st as its fiscal year-end.

On August 20, 2020, the Company formed two new wholly-owned subsidiaries, Dawn Merger Sub I, Inc., a Delaware corporation (“Dawn Merger Sub I”), and Dawn Merger Sub II, LLC (“Dawn Merger Sub II”), a Delaware limited liability company, in contemplation of the Proposed Business Combination (as defined below).

At September 30, 2020, the Company had not commenced any operations. All activity for the period from August 28, 2018 (inception) through September 30, 2020 relates to the Company’s formation and initial public offering (“Public Offering”) described below, the identification and evaluation of prospective acquisition targets for a Business Combination and the entry into the Merger Agreement (as defined below) in connection with the Proposed Business Combination and transactions contemplated thereby. The Company completed the Public Offering on February 5, 2019 (the “IPO Closing Date”).

The Company will not generate any operating revenues until after the completion of the Business Combination, at the earliest. Subsequent to the Public Offering, the Company generates non-operating income in the form of interest income on cash and cash equivalents from the proceeds derived from the Public Offering and the sale of the Private Placement Warrants (as defined below) held in the Trust Account (as defined below).

Proposed Luminar Technologies, Inc. Business Combination

On August 24, 2020, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”), by and among the Company, Dawn Merger Sub I, Dawn Merger Sub II and Luminar Technologies, Inc. (“Luminar”), which provides for, among other things: (a) the merger of Dawn Merger Sub I with and into Luminar, with Luminar continuing as the surviving corporation (the “First Merger”); and (b) immediately following the First Merger and as part of the same overall transaction as the First Merger, the merger of Luminar with and into Dawn Merger Sub II, with Dawn Merger Sub II continuing as the surviving entity (the “Second Merger” and, together with the First Merger, the “Mergers”). The transactions set forth in the Merger Agreement, including the Mergers, will constitute a “Business Combination” as contemplated by the Company’s Amended and Restated Certificate of Incorporation. Such transactions are hereinafter referred to as the “Proposed Business Combination.”

The Merger Agreement and the transactions contemplated thereby were unanimously approved by the Board of Directors of the Company (the “Board”) on August 23, 2020.

The Merger Agreement

Pursuant to the Merger Agreement, the aggregate merger consideration payable to the stockholders of Luminar will be a number of shares of Company class A common stock, par value $0.0001 per share (the “Class A Stock”) and Company Class B common stock, par value $0.001 per share (the “Class B Stock”) (each deemed to have a value of $10.00 per share) with an implied value equal to $2,928,828,692, plus an aggregate amount of up to $30,000,000 depending on the amount of additional capital raised by Luminar prior to the closing of the Proposed Business Combination, divided by $10.00. Holders of shares of (a) Luminar’s Class A common stock, preferred stock and founders preferred stock will be entitled to receive a number of shares of newly-issued Class A Stock

7


 

equal to the Per Share Company Stock Consideration (as defined in the Merger Agreement) issuable in Class A Stock and (b) Luminar’s Class B common stock will be entitled to receive a number of shares of newly-issued Company Class B common stock equal to the Per Share Company Stock Consideration issuable in Company Class B common stock.

In addition to the consideration to be paid at the closing of the Proposed Business Combination, stockholders of Luminar will be entitled to receive an additional number of earn-out shares from the Company, issuable in either Class A Stock or Company Class B common stock as provided in the Merger Agreement, of up to 7.5% of the total outstanding capital stock of the Company as of the closing of the Proposed Business Combination (including shares subject to outstanding Luminar stock options, restricted stock and warrants that will be assumed by the Company in connection with the Proposed Business Combination.

For further discussion of the Proposed Business Combination and the Merger Agreement, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Recent Developments— Proposed Luminar Technologies, Inc. Business Combination.”

Financing

Upon the IPO Closing Date and the sale of the Private Placement Warrants, an aggregate of $400,000,000 was placed in a Trust Account with Continental Stock Transfer & Trust Company acting as trustee (the “Trust Account”).

The Company intends to finance a Business Combination with the net proceeds from its $400,000,000 Public Offering and its sale of $10,000,000 of Private Placement Warrants (see Note 3).    

Trust Account

Funds held in the Trust Account can be invested only in U.S. government treasury bills with a maturity of one hundred and eighty (180) days or less or in money market funds meeting certain conditions under Rule 2a‑7 under the Investment Company Act of 1940, as amended, that invest only in direct U.S. government obligations. As of September 30, 2020, the Trust Account consisted of money market funds.

The Company’s amended and restated certificate of incorporation provides that, other than the withdrawal of interest to fund regulatory compliance requirements and other costs related thereto (a “Regulatory Withdrawal”), subject to an annual limit of $750,000, for a maximum 24 months and/or additional amounts necessary to pay franchise and income taxes, if any, none of the funds held in trust will be released until the earliest of: (i) the completion of the Business Combination; or (ii) the redemption of any public shares of common stock properly tendered in connection with a stockholder vote to amend the Company’s amended and restated certificate of incorporation to modify the substance or timing of the Company’s obligation to redeem 100% of such public shares of common stock if the Company does not complete the Business Combination within 24 months from the IPO Closing Date; or (iii) the redemption of 100% of the public shares of common stock if the Company is unable to complete a Business Combination within 24 months from the IPO Closing Date, subject to the requirements of law and stock exchange rules.

8


 

Business Combination

The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Public Offering, although substantially all of the net proceeds of the Public Offering are intended to be generally applied toward consummating a Business Combination. The Business Combination must be with one or more target businesses that together have an aggregate fair market value of at least 80% of the assets held in the Trust Account (less any deferred underwriting commissions and taxes payable on interest income earned) at the time of the Company signing a definitive agreement in connection with the Business Combination. Furthermore, there is no assurance that the Company will be able to successfully effect a Business Combination.

As discussed above, the Company entered into a definitive agreement for the Proposed Business Combination and intends to seek stockholder approval of the Proposed Business Combination at a meeting called for such purpose in connection with which stockholders may seek to redeem their shares, regardless of whether they vote for or against the Proposed Business Combination, for cash equal to their pro rata share of the aggregate amount then on deposit in the Trust Account as of two business days prior to the consummation of the Business Combination, including interest income but less taxes payable. The Company will complete the Proposed Business Combination only if a majority of the outstanding shares of common stock voted are voted in favor of the Proposed Business Combination. Currently, the Company will not redeem its public shares of common stock in an amount that would cause its net tangible assets to be less than $5,000,001. In such case, the Company would not proceed with the redemption of its public shares of common stock and the related Proposed Business Combination, and instead may search for an alternate Business Combination.

In connection with a Business Combination, the Company may alternatively provide stockholders with the opportunity to sell their shares to the Company by means of a tender offer (and thereby avoid the need for a stockholder vote) for an amount in cash equal to their pro rata share of the aggregate amount then on deposit in the Trust Account as of two business days prior to the consummation of the Business Combination, including interest income but less taxes payable. The decision as to whether the Company will seek stockholder approval of the Business Combination or will allow stockholders to sell their shares in a tender offer will be made by the Company, solely in its discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would otherwise require the Company to seek stockholder approval, unless a vote is required by law or under NASDAQ rules

As a result of the foregoing redemption provisions, the public shares of common stock will be recorded at the redemption amount and classified as temporary equity, in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 480, “Distinguishing Liabilities from Equity” (“ASC Topic 480”) in subsequent periods.

The Company will have 24 months from the IPO Closing Date to complete the Business Combination. If the Company does not complete a Business Combination within this period of time, it shall (i) cease all operations except for the purposes of winding up; (ii) as promptly as reasonably possible, but not more than ten business days thereafter, redeem the public shares of common stock for a per share pro rata portion of the Trust Account, including interest income, but less taxes payable (less up to $100,000 of such net interest income to pay dissolution expenses) and (iii) as promptly as possible following such redemption, dissolve and liquidate the balance of the Company’s net assets to its remaining stockholders, as part of its plan of dissolution and liquidation. In the event of such distribution, it is possible that the per share value of the residual assets remaining available for distribution (including Trust Account assets) will be less than the initial public offering price per Unit in the Public Offering.

The Sponsor and the Company’s officers and directors have entered into letter agreements with the Company, pursuant to which they waived their rights to participate in any redemption with respect to their Founder Shares (as defined below); however, if the Sponsor or any of the Company’s officers, directors or affiliates acquire public shares of common stock, they will be entitled to a pro rata share of the Trust Account in the event the Company does not complete a Business Combination within the required time period.

In connection with the Proposed Business Combination, the Sponsor and the Company’s independent directors (the “Initial Stockholders”) have also entered into a Waiver Agreement pursuant to which they have waived their rights to a conversion price adjustment with respect to any shares of common stock they may hold in

9


 

connection with the consummation of the Proposed Business Combination. Currently, the Sponsor and the Company’s officers and directors own 20% of our issued and outstanding shares of common stock, including all of the Founder Shares (as defined below).

Emerging Growth Company

Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard.

2.       Significant Accounting Policies

Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the accounting and disclosure rules and regulations of the Securities and Exchange Commission (“SEC”), and reflect all adjustments, consisting only of normal recurring adjustments, which are, in the opinion of management, necessary for a fair presentation of the financial position as of September 30, 2020 and the results of operations and cash flows for the periods presented. Operating results for the nine months ended September 30, 2020 are not necessarily indicative of results that may be expected for the full year or any other period. The accompanying unaudited consolidated financial statements should be read in conjunction with the Company’s audited financial statements included in the Company’s Annual Report on Form 10-K filed with the SEC on March 13, 2020.

Principles of Consolidation

The accompanying unaudited consolidated financial statements include the accounts of the Company and the accounts of the Company’s wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated upon consolidation.

10


 

Net Income/(Loss) Per Common Share

The Company has two classes of shares, which are referred to as Class A and Class F common stock, par value $0.0001 per share (the “Founder Shares”). Net income/(loss) per common share is computed utilizing the two-class method. The two-class method is an earnings allocation formula that determines earnings per share separately for each class of common stock based on an allocation of undistributed earnings per the rights of each class. At September 30, 2020, the Company did not have any dilutive securities or other contracts that could, potentially, be exercised or converted into common stock and then share in the earnings of the Company under the treasury stock method. As a result, diluted net income/(loss) per common share is the same as basic net income/(loss) per common share for the period. The table below presents a reconciliation of the numerator and denominator used to compute basic and diluted net income/(loss) per share for each class of common stock:

 

 

 

For the Three Months Ended September 30, 2020

 

 

For the Three Months Ended September 30, 2019

 

 

For the Nine Months Ended September 30, 2020

 

 

For the Nine Months Ended September 30, 2019

 

 

 

Class A

 

 

Class F

 

 

Class A

 

 

Class F

 

 

Class A

 

 

Class F

 

 

Class A

 

 

Class F

 

Basic and diluted net income/(loss) per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Numerator:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allocation of net income/(loss)

 

$

 

(3,215,855

)

 

$

 

(810,560

)

 

$

 

1,627,320