ROI Acquisition Corp. II - FORM 10-Q

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EX-31.2 - EXHIBIT 31.2 - ROI Acquisition Corp. II	v416346_ex31-2.htm
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EX-32.2 - EXHIBIT 32.2 - ROI Acquisition Corp. II	v416346_ex32-2.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended June 30, 2015

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

Commission File Number: 001-36068

ROI ACQUISITION CORP. II

(Exact name of registrant as specified in its charter)

Delaware

46-3100431

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

601 Lexington Avenue, 51^st Floor, New York, New York 10022

(212) 825-0400

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

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 x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ¨		Accelerated filer	x
Non-accelerated filer ¨	(Do not check if a smaller reporting company)	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes x No ¨

As of August 6, 2015, the registrant had 15,625,000 shares of its common stock, par value $0.0001 per share, outstanding.

ROI ACQUISITION CORP. II

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION	3
ITEM 1. FINANCIAL STATEMENTS	3
Condensed Interim Balance Sheets	3
Condensed Interim Statements of Operations	4
Condensed Interim Statements of Cash Flows	5
Notes to Condensed Interim Financial Statements	6
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	17
Forward-Looking Statements	17
Overview	18
Results of Operations	18
Liquidity and Capital Resources	18
Critical Accounting Policies	19
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	21
ITEM 4. CONTROLS AND PROCEDURES	21
PART II. OTHER INFORMATION	22
ITEM 1. LEGAL PROCEEDINGS	22
ITEM 1A. RISK FACTORS	22
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	22
ITEM 3. DEFAULTS UPON SENIOR SECURITIES	23
ITEM 4. MINE SAFETY DISCLOSURES	23
ITEM 5. OTHER INFORMATION	23
ITEM 6. EXHIBITS	23
SIGNATURES	24

PART I — FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

ROI ACQUISITION CORP. II

Condensed Interim Balance Sheets

	June 30, 2015			December 31, 2014
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	179,472		$	352,218
Noncurrent assets:
Investments and cash held in Trust Account		125,090,083			125,073,277
Total assets	$	125,269,555		$	125,425,495
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued expenses	$	674,448		$	152,227
Franchise tax accrual		248,862			158,862
Total current liabilities		923,310			311,089
Deferred underwriter fee		4,375,000			4,375,000
Total liabilities		5,298,310			4,686,089
Commitments and Contingencies
Common stock subject to possible redemption; 11,497,124 and 11,573,940 shares at $10.00 as of June 30, 2015 and December 31, 2014, respectively		114,971,240			115,739,399
Stockholders’ equity:
Preferred stock, $.0001 par value; 1,000,000 shares authorized; none issued		-			-
Common stock, $.0001 par value, authorized 400,000,000 shares; 4,127,876 and 4,051,060 shares issued and outstanding (excluding 11,497,124 and 11,573,940 shares subject to possible redemption) at June 30, 2015 and December 31, 2014, respectively		413			404
Additional paid-in capital		6,849,219			5,921,069
Accumulated deficit		(1,849,627	)		(921,466	)
Total stockholders’ equity		5,000,005			5,000,007
Total liabilities and stockholders’ equity	$	125,269,555		$	125,425,495

The accompanying notes are an integral part of these condensed interim financial statements.

ROI ACQUISITION CORP. II

Condensed Interim Statements of Operations

(unaudited)

	For the three months ended June 30, 2015			For the three months ended June 30, 2014			For the six months ended June 30, 2015			For the six months ended June 30, 2014

Revenue	$	-		$	-		$	-		$	-
Formation and operating costs		478,246			114,689			854,966			327,289
State franchise taxes, other than income tax		45,000			45,000			90,000			91,894

Loss from operations		(523,246	)		(159,689	)		(944,966	)		(419,183	)
Other income - Interest income		3,984			17,658			16,805			32,857
Net loss attributed to common shares outstanding	$	(519,262	)	$	(142,031	)	$	(928,161	)	$	(386,326	)

Weighted average number of common shares outstanding, basic and diluted (excluding shares subject to possible redemption)		4,076,508			4,002,679			4,063,922			3,990,523
Net loss per common share outstanding, basic and diluted	$	(0.13	)	$	(0.04	)	$	(0.23	)	$	(0.10	)

The accompanying notes are an integral part of these condensed interim financial statements.

ROI ACQUISITION CORP. II

Condensed Interim Statements of Cash Flows

(unaudited)

	Six months ended June 30, 2015			Six months ended June 30, 2014
Cash flows from operating activities
Net loss	$	(928,161	)	$	(386,326	)
Adjustment to reconcile net loss to net cash used in operating activities: Share-based payment to employee by Initial Stockholders		160,000			-
Changes in operating assets and liabilities:
Accounts payable and accrued expenses		522,221			50,022
Franchise tax accrual		90,000			17,862
Net cash used in operating activities		(155,940	)		(318,442	)

Cash flows from investing activities
Interest on Trust Account		(16,806	)		(30,862	)
Net cash used in investing activities		(16,806	)		(30,862	)

Cash flows from financing activities
Payment of offering costs		-			(17,500	)
Net cash used in financing activities		-			(17,500	)

Net decrease in cash and cash equivalents		(172,746	)		(366,804	)
Cash and cash equivalents, beginning of period		352,218			961,544
Cash and cash equivalents, end of period	$	179,472		$	594,740

The accompanying notes are an integral part of these condensed interim financial statements.

ROI ACQUISITION CORP. II

NOTES TO CONDENSED INTERIM FINANCIAL STATEMENTS

(Unaudited)

Note 1. Interim Financial Information

The accompanying unaudited condensed interim financial statements of ROI Acquisition Corp. II (the “Company”) should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K filed with the United States Securities and Exchange Commission (the “SEC”) on March 16, 2015. The accompanying condensed interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 and Article 10 of Regulation S-X, 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 June 30, 2015, and the results of operations for the three- and six-month periods ended June 30, 2015 and June 30, 2014. Since they are interim statements, the accompanying condensed interim financial statements do not include all of the information and notes required by GAAP for a complete financial statement presentation. In the opinion of management, the condensed interim financial statements reflect all adjustments (consisting of normal, recurring adjustments) that are necessary for the fair presentation of the financial position, results of operations and cash flows for the condensed interim periods presented. Interim results are not necessarily indicative of results for a full year.

Note 2. Organization and Business Operations

Incorporation

The Company was incorporated in Delaware on June 28, 2013.

Sponsor

The Company’s sponsor is GEH Capital, Inc. (the “Sponsor”), a Delaware corporation. The Sponsor is owned and controlled by George E. Hall, the Company’s Chief Investment Officer and a member of its board of directors.

Fiscal Year End

The Company has selected December 31 as its fiscal year end.

Business Purpose

The Company was formed for the purpose of acquiring, through a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or other similar business combination, one or more operating businesses or assets that the Company has not yet identified (“Business Combination”). The Company has neither engaged in any operations nor generated significant revenue to date. The Company's activities are subject to significant risks and uncertainties that are described below.

The Company’s management has broad discretion with respect to the Business Combination. However, there is no assurance that the Company will be able to successfully effect a Business Combination.

As more fully described in Note 11 – “Subsequent Events,” on July 23, 2015, the Company entered into an Agreement and Plan of Merger (as may be amended, the “Merger Agreement”), by and among the Company, Ascend Telecom Infrastructure Private Limited, a private limited company organized under the laws of India (“Ascend India”), Ascend Telecom Holdings Limited, an exempted company incorporated with limited liability under the laws of the Cayman Islands (“Ascend Holdings”), and NSR-PE Mauritius LLC, a Mauritius private company limited by shares (“NSR”). Pursuant to the Merger Agreement, the Company will merge with and into a Delaware limited liability company to be formed by Ascend Holdings, with each outstanding share of common stock of the Company, par value $0.0001 per share, being converted into the right to receive one newly issued ordinary share of Ascend Holdings, par value $1.00 per share. In connection therewith, NSR QSR PE Mauritius LLC, a subsidiary of Ascend Holdings, will purchase from Infrastructure Leasing & Financial Services Limited, N.K. Tele Systems Limited and N.K. Telecom Products Limited (collectively, the “IL&FS Parties”) 100% of the ordinary shares of Ascend India owned by the IL&FS Parties for an aggregate purchase price of INR 2,700,000,000, resulting in Ascend India becoming an indirect wholly-owned subsidiary of Ascend Holdings. The transactions contemplated by the Merger Agreement are referred to herein as the “Proposed Business Combination.”

Financing

On September 20, 2013, the Company consummated an initial public offering (the “Public Offering”) and a concurrent private placement. Approximately $125,000,000 of the proceeds of the Public Offering and the private placement 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 in part with proceeds from the Public Offering and private placement that are held in the Trust Account. See Notes 4 and 5 below.

Trust Account

The Trust Account can be invested in permitted United States “government securities” within the meaning of Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), having a maturity of 180 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act which invest only in direct U.S. government treasury obligations.

The Company’s amended and restated certificate of incorporation provides that, other than the withdrawal of interest to pay income taxes and franchise taxes, none of the funds held in trust will be released until the earlier of: (i) the completion of the Business Combination; or (ii) the redemption of 100% of the shares of common stock included in the units sold in the Public Offering if the Company is unable to complete a Business Combination by September 20, 2015.

Business Combination

A Business Combination is subject to the following size, focus and stockholder approval provisions:

Size/Control — The Company’s Business Combination must occur with one or more target businesses that together have a fair market value of at least 80% of the assets held in the Trust Account (excluding the deferred underwriting commissions and taxes payable on the income earned on the Trust Account) at the time of the agreement to enter into the Business Combination. The Company will not complete a Business Combination unless it acquires a controlling interest in a target company or is otherwise not required to register as an investment company under the Investment Company Act.

Focus — The Company’s efforts in identifying prospective target businesses will initially be focused on businesses in the consumer sector, and in particular the consumer products, retail, and restaurant industries, and the financial services sector, and in particular the asset management industry, but the Company may pursue opportunities in other business sectors.

Tender Offer/Stockholder Approval — The Company, after signing a definitive agreement for a Business Combination, will either (i) seek stockholder approval of the 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 Business Combination, for cash equal to their pro rata share of the aggregate amount then on deposit in the Trust Account, including interest (which interest shall be net of franchise and income taxes payable), or (ii) 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, including interest (which interest shall be net of franchise and income 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. If the Company seeks stockholder approval, it will complete its Business Combination only if a majority of the outstanding shares of common stock voted are voted in favor of the Business Combination. However, in no event will the Company redeem its public shares 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 and the related Business Combination, and instead may search for an alternate Business Combination.

Regardless of whether the Company holds a stockholder vote or a tender offer in connection with a Business Combination, a public stockholder will have the right to redeem its shares for an amount in cash equal to its pro rata share of the aggregate amount then on deposit in the Trust Account, including interest (which interest shall be net of franchise and income taxes payable). As a result, such shares of common stock are recorded at conversion/tender value and classified as temporary equity upon the completion of the Public Offering, in accordance with Financial Accounting Standards Board Accounting Standards Codification ("FASB ASC") 480, “Distinguishing Liabilities from Equity.”

As more fully described in Note 11 – “Subsequent Events,” on July 23, 2015, the Company entered into the Merger Agreement by and among the Company, Ascend India, Ascend Holdings and NSR. Pursuant to the Merger Agreement, the Company will merge with and into a Delaware limited liability company to be formed by Ascend Holdings, with each outstanding share of common stock of the Company, par value $0.0001 per share, being converted into the right to receive one newly issued ordinary share of Ascend Holdings, par value $1.00 per share. In connection therewith, NSR QSR PE Mauritius LLC, a subsidiary of Ascend Holdings, will purchase from the IL&FS Parties 100% of the ordinary shares of Ascend India owned by the IL&FS Parties for an aggregate purchase price of INR 2,700,000,000, resulting in Ascend India becoming an indirect wholly-owned subsidiary of Ascend Holdings.

Going Concern Consideration

If the Company does not complete a Business Combination by September 20, 2015, the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem 100% of the common stock sold as part of the units in the Public Offering, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest (which interest shall be net of franchise and income taxes payable and less up to $50,000 of such net interest which may be distributed to the Company to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining stockholders and the Company’s board of directors, dissolve and liquidate, subject in each case to the Company’s obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. This mandatory liquidation and subsequent dissolution requirement raises substantial doubt about the Company’s ability to continue as a going concern.

In the event of liquidation, it is likely that the per share value of the residual assets remaining available for distribution (including Trust Account assets) will be approximately equal to the initial public offering price per share in the Public Offering (assuming no value is attributed to the warrants contained in the units sold in the Public Offering discussed in Note 4).

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 registration statement under the Securities Act of 1933, as amended (the “Securities Act”) declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies, but any such an election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

Note 3. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying condensed interim financial statements of the Company are presented in U.S. dollars in conformity with GAAP and pursuant to the rules and regulations of the SEC.

Redeemable Common Stock

As discussed in Note 4, all of the 12,500,000 shares of common stock sold as part of the Public Offering contain a redemption feature which allows for the redemption of shares of common stock under the Company’s liquidation or tender offer/stockholder approval provisions. In accordance with FASB ASC 480, redemption provisions not solely within the control of the Company require the security to be classified outside of permanent equity. Ordinary liquidation events, which involve the redemption and liquidation of all of the entity’s equity instruments, are excluded from the provisions of FASB ASC 480. Although the Company does not specify a maximum redemption threshold, its charter provides that in no event will the Company redeem its Public Shares (as defined below) in an amount that would cause its net tangible assets (stockholders’ equity) to be less than $5,000,001. In such case, the Company would not proceed with the redemption of its Public Shares (as defined below) and the related Business Combination, and instead may search for an alternate Business Combination.

The Company recognizes changes in redemption value immediately as they occur and will adjust the carrying value of the security to equal the redemption value at the end of each reporting period. Increases or decreases in the carrying amount of redeemable common stock shall be affected by charges against retained earnings, or in the absence of retained earnings, by charges against paid-in capital in accordance with FASB ASC 480-10-S99. Accordingly, at June 30, 2015 and December 31, 2014, 11,497,124 and 11,573,940, respectively, Public Shares (as defined below) are classified outside of permanent equity at its redemption value.

Net Loss Per Share

Basic net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing net loss per share by the weighted average number of shares of common stock outstanding, plus, to the extent dilutive, the incremental number of shares of common stock to settle warrants held by the Sponsor (see Note 5), as calculated using the treasury stock method. At June 30, 2015 and December 31, 2014, the Company had outstanding warrants to purchase 10,250,000 shares of common stock. For all periods presented, the weighted average of these shares was excluded from the calculation of diluted income (loss) per share of common stock because their inclusion would have been anti-dilutive. As a result, dilutive income (loss) per share of common stock is equal to basic income (loss) per share of common stock.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed interim financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash accounts in a financial institution, which, at times, may exceed the Federal depository insurance coverage of $250,000. The Company has not experienced losses on these accounts and management believes the Company is not exposed to significant risks on such accounts.

Income Taxes

The Company complies with the accounting and reporting requirements of FASB ASC 740, “Income Taxes,” which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred income tax assets and liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that will result in future taxable or deductible amounts, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

There were no unrecognized tax benefits as of June 30, 2015 and December 31, 2014. FASB ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. No amounts were accrued for the payment of interest and penalties at June 30, 2015 and December 31, 2014. The Company is currently not aware of any issues under review that could result in significant payments, accruals or a material deviation from its position. Since inception, the Company has been subject to income tax examinations by major taxing authorities.

Fair Value of Financial Instruments

The fair value of the Company’s assets and liabilities, which qualify as financial instruments under FASB ASC 820, “Fair Value Measurement,” approximates the carrying amounts represented in the condensed interim balance sheets.

Recent Accounting Pronouncements

In June 2014, FASB issued Accounting Standards Update (“ASU”) No. 2014-10, which eliminated certain financial reporting requirements of companies previously identified as “Development Stage Entities” (Topic 915). The amendments in this ASU simplify accounting guidance by removing all incremental financial reporting requirements for development stage entities. The amendments also reduce data maintenance and, for those entities subject to audit, audit costs by eliminating the requirement for development stage entities to present inception-to-date information in the statements of income, cash flows, and stockholder equity. Early application of each of the amendments is permitted for any annual reporting period or interim period for which the entity’s balance sheet has not yet been issued (public business entities) or made available for issuance (other entities). Upon adoption, entities will no longer present or disclose any information required by Topic 915. For public business entities, those amendments are effective for annual reporting periods beginning after December 15, 2014, and interim periods therein. The Company adopted ASU 2014-10 effective January 1, 2015. Adoption of this standard had no impact on the Company's financial position, results of operations or cash flows; however, the presentation of the accompanying condensed interim financial statements does not present the disclosures that are no longer required.

Management does not believe that any other recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s condensed interim financial statements.

Note 4. Public Offering

Public Units

On September 20, 2013, the Company sold 12,500,000 units at a price of $10.00 per unit (the “Public Units”) in the Public Offering. Each unit consists of one share of common stock of the Company, $0.0001 par value per share (the “Public Shares”), and one warrant to purchase one-half of one share of common stock of the Company (the “Public Warrants”).

Under the terms of a warrant agreement relating to the Public Warrants (the “Warrant Agreement”), the Company has agreed to use its best efforts to file a new registration statement under the Securities Act for the shares of common stock issuable upon exercise of the Public Warrants as soon as practicable, but in no event later than fifteen (15) business days after the closing of the Company’s Business Combination.

Public Warrant Terms and Conditions

Exercise Conditions— Each Public Warrant entitles the holder to purchase one-half of one share of common stock at a price of $5.75 per half share ($11.50 per whole share). No fractional shares will be issued upon exercise of the Public Warrants. If, upon exercise of the Public Warrants, a holder would be entitled to receive a fractional interest in a share, the Company will, upon exercise, round down to the nearest whole number the number of shares of common stock to be issued to the warrant holder. Each Public Warrant will become exercisable 30 days after the completion of the Company’s Business Combination. However, if the Company does not complete a Business Combination on or prior to the expiration of the 24-month period allotted to complete the Business Combination, the Public Warrants will expire at the end of such period. If the Company is unable to deliver registered shares of common stock to the holder upon exercise of Public Warrants during the exercise period, there will be no net cash settlement of the Public Warrants and the Public Warrants will expire worthless, unless they may be exercised on a cashless basis in the circumstances described in the Warrant Agreement.

Registration Risk— Under the terms of the Warrant Agreement, the Company has agreed to use its best efforts to file a registration statement under the Securities Act covering the shares of common stock issuable upon exercise of the Public Warrants and the Private Placement Warrants (as defined below) (the Public Warrants and Private Placement Warrants, collectively, the “Warrants”) and maintain a current prospectus relating to the common stock issuable upon exercise of the Warrants, until the expiration of the Warrants in accordance with the provisions of the Warrant Agreement. If the shares issuable upon exercise of the Warrants are not registered under the Securities Act, the Company will be required to permit holders to exercise their Warrants on a cashless basis. However, no Warrant will be exercisable for cash or on a cashless basis, and the Company will not be obligated to issue any shares to holders seeking to exercise their Warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, unless an exemption is available. Notwithstanding the above, if the Company’s common stock is at the time of any exercise of a Warrant not listed on a national securities exchange such that it satisfies the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of Warrants who exercise their Warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event the Company so elects, the Company will not be required to file or maintain in effect a registration statement or register or qualify the shares under blue sky laws. In no event will the Company be required to net cash settle any Warrant, or issue securities or other compensation in exchange for the Warrants in the event that the Company is unable to register or qualify the shares underlying the Warrants under the Securities Act or applicable state securities laws. If the issuance of the shares upon exercise of the Warrants is not so registered or qualified or exempt from registration or qualification, the holder of such Warrant shall not be entitled to exercise such Warrant and such Warrant may have no value and expire worthless. In such event, holders who acquired their Public Warrants as part of a purchase of Public Units will have paid the full Public Unit purchase price solely for the shares of common stock included in the Public Units. If and when the Public Warrants become redeemable by the Company, the Company may exercise its redemption right even if it is unable to register or qualify the underlying shares of common stock for sale under all applicable state securities laws.

Accounting— Because the Company is not required to net cash settle the Public Warrants, the Public Warrants are recorded at fair value and classified within stockholders’ equity as “Additional paid-in capital” upon their issuance in accordance with FASB ASC 815-40.

Underwriting Agreement— The Company paid an upfront underwriting discount of $0.20 per unit ($2,500,000 in the aggregate) to the underwriters at the closing of the Public Offering, with an additional fee (the “Deferred Discount”) equal to the difference between (a) the product of the number of shares of common stock sold as part of the units and $0.55 and (b) the upfront underwriting discount paid at the closing of $2,500,000, or a total Deferred Discount of $4,375,000 ($0.35 per unit sold). The Deferred Discount will become payable to the underwriters from the amounts held in the Trust Account solely in the event the Company completes a Business Combination. The underwriters are not entitled to any interest accrued on the Deferred Discount.

Note 5. Related Party Transactions

Founder Shares — On June 28, 2013, the Sponsor purchased 3,593,750 shares of common stock (the “Founder Shares”) for $25,000, or approximately $0.007 per share. On August 22, 2013, the Sponsor transferred 171,875 Founder Shares to each of Thomas J. Baldwin and Joseph A. De Perio (collectively with the Sponsor, the “Initial Stockholders”), each of whom paid a purchase price of $1,195.65 for their respective shares (the same per-share purchase price initially paid by the Sponsor).

The Founder Shares are identical to the common stock included in the Public Units except that the Founder Shares are subject to certain transfer restrictions. The Initial Stockholders have agreed not to transfer, assign or sell any of their Founder Shares until the earlier of (A) one year after the completion of the Company’s Business Combination, or earlier if, subsequent to the Company’s Business Combination, the last sales price of the Company’s common stock (i) equals or exceeds $12.50 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period after the Company’s Business Combination, in which case fifty percent (50%) of the Founder Shares will be transferable, assignable or salable or (ii) equals or exceeds $15.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period after the Company’s Business Combination in which case the remaining fifty percent (50%) of the Founder Shares will be transferable, assignable or salable or (B) the date on which the Company completes a liquidation, merger, stock exchange or other similar transaction after the Business Combination that results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property.

Forfeiture —As a result of the underwriters’ election not to exercise their over-allotment option for the Public Offering, the Sponsor forfeited an aggregate of 468,750 Founder Shares on September 20, 2013, which the Company has cancelled. After giving effect to the forfeiture, the Initial Stockholders owned 3,125,000 shares, or 20% of the Company’s issued and outstanding shares (including those subject to possible redemption).

In addition, a portion of the Founder Shares in an amount equal to 25% of the Founder Shares, or 5% of the Company’s issued and outstanding shares after the Public Offering (the “Founder Earnout Shares”), will be subject to forfeiture by the Sponsor (or its permitted transferees) on the fifth anniversary of the Business Combination unless following the Business Combination the last sale price of the Company’s common stock equals or exceeds $13.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period or the Company completes a liquidation, merger, stock exchange or other similar transaction that results in all of its stockholders having the right to exchange their shares of common stock for consideration in cash, securities or other property which equals or exceeds $13.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like). The number of Founder Earnout Shares is 781,250 at June 30, 2015.

Rights — The Founder Shares are identical to the Public Shares except that (i) the Founder Shares are subject to certain transfer restrictions, as described above, and (ii) the Initial Stockholders have agreed to waive their redemption rights in connection with the Business Combination with respect to the Founder Shares and any Public Shares they may purchase, and to waive their redemption rights with respect to the Founder Shares if the Company fails to complete a Business Combination within 24 months from the closing of the Public Offering.

Voting — If the Company seeks stockholder approval of a Business Combination, the Initial Stockholders have agreed to vote their Founder Shares and any Public Shares purchased during or after the Public Offering in favor of the Business Combination.

Liquidation — Although the Initial Stockholders and their permitted transferees have agreed to waive their rights to liquidating distributions with respect to the Founder Shares if the Company fails to complete a Business Combination within the prescribed time frame, they will be entitled to receive liquidating distributions with respect to any Public Shares they may own.

Private Placement Warrants

On September 20, 2013, the Sponsor purchased from the Company an aggregate of 8,000,000 warrants at a price of $0.50 per warrant (a purchase price of $4.0 million) in a private placement that occurred simultaneously with the completion of the Public Offering (the “Private Placement Warrants”). Each Private Placement Warrant entitles the holder to purchase one-half of one share of common stock at $5.75 per half share ($11.50 per whole share). The purchase price of the Private Placement Warrants was added to the proceeds from the Public Offering held in the Trust Account pending completion of the Company’s Business Combination. Immediately after the closing of the private placement, the Sponsor transferred the Private Placement Warrants to Clinton Magnolia Master Fund Ltd., an affiliate of the Sponsor, which paid a purchase price of $4.0 million for the Private Placement Warrants.

The Private Placement Warrants (including the common stock issuable upon exercise of the Private Placement Warrants) will not be transferable, assignable or salable until 30 days after the completion of the Business Combination, and they will be non-redeemable so long as they are held by the initial purchasers of the Private Placement Warrants or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers of the Private Placement Warrants or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. Otherwise, the Private Placement Warrants have terms and provisions that are identical to those of the Public Warrants and have no net cash settlement provisions.

If the Company does not complete a Business Combination, then the proceeds from the sale of the Private Placement Warrants will be part of the liquidating distribution to the public stockholders, and the Private Placement Warrants will expire worthless.

Registration Rights

The holders of the Founder Shares and Private Placement Warrants hold registration rights to require the Company to register the sale of any of the securities held by them pursuant to a registration rights agreement. The holders of these securities will be entitled to make up to three demands, excluding short form demands, that the Company register such securities for sale under the Securities Act. In addition, these stockholders will have “piggy-back” registration rights to include their securities in other registration statements filed by the Company. The Company will bear the costs and expenses of filing any such registration statements.

Note 6. Other Related Party Transactions

Administrative Services

The Company has entered into an Administrative Services Agreement with the Clinton Group, Inc., pursuant to which the Company will pay the Clinton Group, Inc. a total of $10,000 per month for office space, utilities and secretarial support. Upon completion of the Business Combination or the Company’s liquidation, the Company will cease paying these monthly fees. During the three and six-month periods ended June 30, 2015 and June 30, 2014, $30,000 and $60,000 was expensed under this agreement for the respective periods. At June 30, 2015, $50,000 is included in "Accounts payable and accrued expenses" in the accompanying condensed interim balance sheets.

Founder Share Transfer

On March 6, 2015, the Initial Stockholders assigned 781,248 Founder Shares in a private transaction for $5,435, or $0.007 per share. The shares were assigned to an employee of the Company for services to the Company in connection with such employee identifying international companies as potential counterparties for the Business Combination. Certain shares (195,312) are subject to the forfeiture provisions detailed above under “Related Party Transactions” (Note 5). Under certain conditions, these shares may be purchased back by the Initial Stockholders under terms agreed among the Initial Stockholders and the employee. The Company complies with the requirements of the ASC 225-10-S99, Accounting for Expenses or Liabilities Paid by Principal Stockholder(s). Accordingly, the fair value of the shares transferred of $160,000 was recorded as an expense of the Company with a corresponding entry to contributed capital for the contribution by the Initial Stockholders to additional paid in capital.

Note 7. Income Taxes

Deferred income taxes are provided for the differences between the bases of assets and liabilities for financial reporting and income tax purposes. A valuation allowance is established when necessary to reduce deferred tax assets to the amount expected to be realized.

The Company is required to determine whether its tax positions are more likely than not to be sustained upon examination by the applicable taxing authority, including resolution of any related appeals or litigation processes, based on the technical merits of the position. The tax benefit recognized is measured as the largest amount of benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement with the relevant taxing authority. De-recognition of a tax benefit previously recognized results in the Company recording a tax liability that reduces ending retained earnings. Based on its analysis, the Company has determined that it has not incurred any liability for unrecognized tax benefits as of June 30, 2015. The Company’s conclusions may be subject to review and adjustment at a later date based on factors including, but not limited to, on-going analyses of and changes to tax laws, regulations and interpretations thereof.

The Company recognizes interest and penalties related to unrecognized tax benefits in interest expense and other expenses, respectively. No interest expense or penalties have been recognized for the three and six-month periods ended June 30, 2015 and June 30, 2014. The Company has been subject to income tax examinations by major taxing authorities since inception. At June 30, 2015 and December 31, 2014, the Company had approximately $647,000 and $323,000 of deferred tax assets, respectively, of which approximately $113,000 and $82,000, respectively, is related to net loss carry forwards, which will begin expiring in 2033, and $534,000 and $241,000, respectively, related to start-up costs. ASC 740 requires a “more likely than not” criterion be applied when evaluating the realization of a deferred tax asset. Management does not expect that it is more likely than not that the Company will generate sufficient taxable income in future years to utilize the deferred tax assets. As such, a full valuation allowance of approximately $647,000 and $323,000 at June 30, 2015 and December 31, 2014, respectively, has been recorded against the net deferred tax asset. The deferred tax asset at June 30, 2015 results from applying an effective combined federal and state tax rate of 35% to start-up costs of approximately $1,527,000 and net operating losses of approximately $323,000. Effective tax rates differ from statutory rates due to timing differences in the deductibility of expenses and the establishment of the valuation allowance.

The Company may be subject to potential examination by U.S. federal, U.S. states or foreign jurisdiction authorities in the areas of income taxes. These potential examinations may include questioning the timing and amount of deductions, the nexus of income among various tax jurisdictions and compliance with U.S. federal, U.S. state and foreign tax laws. The Company’s management does not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months.

The Company is incorporated in the State of Delaware and is required to pay franchise taxes to the State of Delaware on an annual basis.

Note 8. Investments and Cash and Cash Equivalents Held in Trust

As of June 30, 2015, the Company’s Trust Account consists of $125,090,083 of cash equivalents invested in a money market fund. As of December 31, 2014, the Company’s Trust Account consists of $125,071,039 in United States Treasury Bills and $2,238 of cash equivalents. The Company classifies its United States Treasury and equivalent securities as held-to-maturity in accordance with FASB ASC 320, “Investments - Debt and Equity Securities.” Held-to-maturity securities are those securities which the Company has the ability and intent to hold until maturity. Held-to-maturity treasury securities are recorded at amortized cost on the accompanying condensed interim balance sheets and adjusted for the amortization or accretion of premiums or discounts. As of June 30, 2015, the Company’s Trust Account did not hold any held to maturity securities. The carrying amount, excluding accrued interest income, gross unrealized holding gains and fair value of held to maturity securities at December 31, 2014 is as follows:

	Carrying Amount at December 31, 2014		Gross Unrealized Holding Gain		Fair Value
Held-to-maturity:
U.S. Treasury Securities	$	125,071,039	$	5,205	$	125,076,244

Note 9. Fair Value Measurements

The Company has adopted FASB ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. The adoption of FASB ASC 820 did not have an impact on the Company’s financial position or results of operations.

The following tables present information about the Company’s assets that are measured at fair value on a recurring basis as of June 30, 2015 and December 31, 2014, and indicate the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities. Fair values determined by Level 2 inputs utilize data points that are observable such as quoted prices, interest rates and yield curves. Fair values determined by Level 3 inputs are unobservable data points for the asset or liability, and includes situations where there is little, if any, market activity for the asset or liability:

	June 30,		Quoted Prices in Active Markets		Significant Other Observable Inputs		Significant Other Unobservable Inputs
Description	2015		(Level 1)		(Level 2)		(Level 3)
Cash equivalents held in Trust Account	$	125,090,083	$	125,090,083	$	—	$	—

	December 31,		Quoted Prices in Active Markets		Significant Other Observable Inputs		Significant Other Unobservable Inputs
Description	2014		(Level 1)		(Level 2)		(Level 3)
Investments and cash held in Trust Account	$	125,076,244	$	125,076,244	$	—	$	—

United States Treasury Securities: The Company used Level 1 inputs to value the U.S. Treasury securities in the Trust Account for disclosure purposes.

Note 10. Stockholders’ Equity

Common Stock — The authorized common stock of the Company includes up to 400,000,000 shares. Holders of the Company’s common stock are entitled to one vote for each share of common stock. At June 30, 2015, there were 15,625,000 shares of common stock outstanding, including 11,497,124 shares subject to possible redemption. At December 31, 2014, there were 15,625,000 shares of common stock outstanding, including 11,573,940 shares subject to possible redemption.

Preferred Shares — The Company is authorized to issue 1,000,000 preferred shares with such designations, voting and other rights and preferences as may be determined from time to time by the Board of Directors. As of June 30, 2015 and December 31, 2014, no preferred shares have been issued.

Note 11. Subsequent Events

On July 23, 2015, the Company entered into the Merger Agreement by and among the Company, Ascend India, Ascend Holdings and NSR. Pursuant to the Merger Agreement, the Company will merge with and into a Delaware limited liability company to be formed by Ascend Holdings, with each outstanding share of common stock of the Company, par value $0.0001 per share, being converted into the right to receive one newly issued ordinary share of Ascend Holdings, par value $1.00 per share. In connection therewith, NSR QSR PE Mauritius LLC, a subsidiary of Ascend Holdings, will purchase from the IL&FS Parties 100% of the ordinary shares of Ascend India owned by the IL&FS Parties for an aggregate purchase price of INR 2,700,000,000, resulting in Ascend India becoming an indirect wholly owned subsidiary of Ascend Holdings.

The ordinary shares to be issued by Ascend Holdings to the Company’s stockholders are expected to constitute between 40.4% and 45.3% of the issued share capital of Ascend Holdings, depending on the number of Public Shares redeemed by the Company’s stockholders in connection with the stockholder vote to approve the Proposed Business Combination and excluding the earnout shares (described below). Ascend Holdings intends to apply to have its ordinary shares listed on The NASDAQ Stock Market LLC (“NASDAQ”) upon the closing of the Proposed Business Combination under the symbol “ASCE.”

In connection with the Proposed Business Combination, the Company will seek the approval of the holders of the Public Warrants to amend the Warrant Agreement so that, upon the consummation of the Proposed Business Combination, each of the Company’s outstanding Public Warrants will be exchanged for cash in the amount of $0.50.

The Merger Agreement provides that, upon the closing of the Proposed Business Combination, Ascend Holdings will issue 2,000,000 ordinary shares to NSR that will be subject to forfeiture. Specifically, (i) 2,000,000 shares will be required to be forfeited if the last sales price of the Ascend Holdings ordinary shares on NASDAQ does not equal or exceed $11.50 per share (with adjustments for splits, dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period within nine months after the closing of the Proposed Business Combination, and (ii) 1,000,000 shares will be required to be forfeited in the event the last sales price of the Ascend Holdings ordinary shares on NASDAQ does not equal or exceed $13.00 per share (with adjustments for splits, dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period within nine months after the closing of the Proposed Business Combination.

Ascend Holdings will also issue 307,652 ordinary shares to the Sponsor, or its designee, upon the closing of the Proposed Business Combination. Such shares will be subject to forfeiture in the event that the last sales price of the Ascend Holdings ordinary shares on NASDAQ does not equal or exceed $13.00 per share (with adjustments for splits, dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period within five years after the closing of the Proposed Business Combination.

The Merger Agreement provides that the number of Ascend Holdings ordinary shares owned by NSR will be subject to adjustment after the closing of the Proposed Business Combination. Following the closing of the Proposed Business Combination, subject to the dispute resolution procedures described in the Merger Agreement, the parties will calculate the difference between (a) $127,200,000, and (b) the amount of cash on hand and indebtedness of Ascend India as of 11:59 p.m. on the closing date (the “Net Adjustment Amount”). If the Net Adjustment Amount is a positive number, then Ascend Holdings will deliver to NSR such number of ordinary shares equal to the Net Adjustment Amount divided by 10 and rounded down to the nearest whole number, and if the Net Adjustment Amount is negative, then NSR and the Company’s agent will instruct Continental Stock Transfer & Trust Company to hold the number of Ascend Holdings ordinary shares equal to the absolute value of the Net Adjustment Amount, divided by ten and rounded down to the nearest whole number, until the 12-month anniversary date of the closing date of the Proposed Business Combination, after which such shares will be released to, and cancelled and extinguished by, Ascend Holdings.

Under the Merger Agreement, the closing of the Proposed Business Combination is subject to a number of conditions, including that (i) the Company’s stockholders approve the Proposed Business Combination, (ii) the amount payable to the Company’s public stockholders who have properly elected to exercise their redemption rights with respect to their Public Shares does not exceed $22,580,000, provided that the Company has a right to privately place up to 1,000,000 shares of common stock for not less than $10.00 per share for purposes of satisfying this condition, (iii) each of the Company’s outstanding warrants are exchanged in accordance with the terms of the Merger Agreement, and (iv) the Company holds not less than INR 5,585,461,616 (subject to a downward adjustment in the event of certain fluctuations in the U.S. Dollar/Indian Rupee exchange rate) following the payment to the Company’s public stockholders who exercise their redemption rights, the Company’s warrantholders in connection with the amendment to the Warrant Agreement (if approved) and of certain transaction expenses. If these conditions are not satisfied, then Ascend Holdings will not be required to consummate the Proposed Business Combination.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

References to the “Company,” “us” or “we” refer to ROI Acquisition Corp. II. References to our “management” or our “management team” refer to our officers and directors, and references to the “Sponsor” refer to GEH Capital, Inc., a Delaware corporation. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the condensed interim financial statements and the notes thereto contained elsewhere in this report. This discussion contains forward-looking statements reflecting our current expectations, estimates and assumptions concerning events and financial trends that may affect our future operating results or financial position. Actual results and the timing of events may differ materially from those contained in these forward-looking statements due to a number of factors, including those discussed in the section entitled “Risk Factors” in our Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on March 16, 2015, and in the section entitled “Forward-Looking Statements” below.

Forward-Looking Statements

The statements contained in this report that are not purely historical are forward-looking statements. Our forward-looking statements include, but are not limited to, statements regarding our or our management’s expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this report may include, for example, statements about:

our ability to complete our initial business combination;

our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business combination;

our officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or in approving our initial business combination;

our potential ability to obtain additional financing to complete our initial business combination;

our pool of prospective target businesses;

the ability of our officers and directors to generate a number of potential investment opportunities;

our public securities’ liquidity and trading;

the use of proceeds not held in the Trust Account described herein or available to us from interest income on the Trust Account balance; or

our financial performance.

The forward-looking statements contained in this report are based on our current expectations and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described under the heading “Risk Factors” in our Annual Report on Form 10-K filed with the SEC on March 16, 2015. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

Overview

We intend to effectuate our Business Combination using cash from the proceeds of a public offering (the “Public Offering”) and a sale of warrants in a private placement that occurred simultaneously with the completion of the Public Offering (the “Private Placement Warrants”), our capital stock, debt or a combination of cash, stock and debt. Upon the closing of the Public Offering and the sale of the Private Placement Warrants, $125,000,000 was placed in a trust account with Continental Stock Transfer & Trust Company acting as trustee (the “Trust Account”).

Proposed Business Combination

On July 23, 2015, the Company entered into an Agreement and Plan of Merger (as may be amended, the “Merger Agreement”), by and among the Company, Ascend Telecom Infrastructure Private Limited, a private limited company organized under the laws of India (“Ascend India”), Ascend Telecom Holdings Limited, an exempted company incorporated with limited liability under the laws of the Cayman Islands (“Ascend Holdings”), and NSR-PE Mauritius LLC, a Mauritius private company limited by shares (“NSR”). Pursuant to the Merger Agreement, the Company will merge with and into a Delaware limited liability company to be formed by Ascend Holdings, with each outstanding share of common stock of the Company, par value $0.0001 per share, being converted into the right to receive one newly issued ordinary share of Ascend Holdings, par value $1.00 per share. In connection therewith, NSR QSR PE Mauritius LLC, a subsidiary of Ascend Holdings, will purchase from Infrastructure Leasing & Financial Services Limited, N.K. Tele Systems Limited and N.K. Telecom Products Limited (collectively, the “IL&FS Parties”) 100% of the ordinary shares of Ascend India owned by the IL&FS Parties for an aggregate purchase price of INR 2,700,000,000, resulting in Ascend India becoming an indirect wholly owned subsidiary of Ascend Holdings. The transactions contemplated by the Merger Agreement are referred to herein as the “Proposed Business Combination.”

The ordinary shares to be issued by Ascend Holdings to the Company’s stockholders are expected to constitute between 40.4% and 45.3% of the issued share capital of Ascend Holdings, depending on the number of public shares redeemed by the Company’s stockholders in connection with the stockholder vote to approve the Proposed Business Combination and excluding the earnout shares (described below). Ascend Holdings intends to apply to have its ordinary shares listed on The NASDAQ Stock Market LLC (“NASDAQ”) upon the closing of the Proposed Business Combination under the symbol “ASCE.”

In connection with the Proposed Business Combination, the Company will seek the approval of the holders of its public warrants to amend the warrant agreement governing its warrants so that, upon the consummation of the Proposed Business Combination, each of the Company’s outstanding public warrants will be exchanged for cash in the amount of $0.50.

Under the Merger Agreement, the closing of the Proposed Business Combination is subject to a number of conditions, including that (i) the Company’s stockholders approve the Proposed Business Combination, (ii) the amount payable to the Company’s public stockholders who have properly elected to exercise their redemption rights with respect to their public shares does not exceed $22,580,000, provided that the Company has a right to privately place up to 1,000,000 shares of common stock for not less than $10.00 per share for purposes of satisfying this condition, (iii) each of the Company’s outstanding warrants are exchanged in accordance with the terms of the Merger Agreement, and (iv) the Company holds not less than INR 5,585,461,616 (subject to a downward adjustment in the event of certain fluctuations in the U.S. Dollar/Indian Rupee exchange rate) following the payment to the Company’s public stockholders who exercise their redemption rights, the Company’s warrantholders in connection with the amendment to the warrant agreement (if approved) and of certain transaction expenses. If these conditions are not satisfied, then Ascend Holdings will not be required to consummate the Proposed Business Combination.

Results of Operations

Through June 30, 2015, our efforts have been limited to organizational activities, activities relating to our initial public offering, activities relating to identifying and evaluating prospective acquisition candidates, conducting due diligence, structuring, negotiating and entering into the Proposed Business Combination (as described below) and activities relating to general corporate matters. We have not generated any revenues. We have generated interest income earned on the proceeds held in the Trust Account.

For the three and six months ended June 30, 2015, we had net losses of $519,262 and $928,161, respectively, which consist of operating, transaction and due diligence costs, offset by interest income of $3,984 and $16,805, respectively, on the Trust Account. For the three and six months ended June 30, 2014, we had net losses of $142,031 and $386,326, respectively, which consist of operating, transaction and due diligence costs, offset by interest income of $17,658 and $32,857, respectively, on the Trust Account

We must complete a Business Combination within 24 months from the closing of the Public Offering. We believe that we have sufficient funds available to complete a Business Combination with an operating business within the allotted time frame.

Liquidity and Capital Resources

As of June 30, 2015, we had cash outside the Trust Account of $179,472. Until the consummation of the Public Offering, the Company’s only source of liquidity was an initial purchase of shares of our common stock (“Founder Shares”) by the Sponsor, and a total of $100,000 loaned by the Sponsor to the Company under an unsecured promissory note (the “Note”). This Note was repaid in full on September 23, 2013.

On September 20, 2013, we consummated our Public Offering of 12,500,000 units at a price of $10.00 per unit. Simultaneously with the consummation of our Public Offering, we consummated the private sale of an aggregate of 8,000,000 Private Placement Warrants, each exercisable to purchase one-half of one share of our common stock at $5.75 per half share ($11.50 per whole share), to the Sponsor, at a price of $0.50 per Private Placement Warrant, generating gross proceeds, before expenses, of $4,000,000. We received net proceeds from our Public Offering and the sale of the Private Placement Warrants of approximately $126,000,000, net of the non-deferred portion of the underwriting commissions of $2,500,000 and offering costs and other expenses of approximately $500,000. For a description of the proceeds generated in our Public Offering and a discussion of the use of such proceeds, we refer you to Note 4 of the unaudited condensed interim financial statements included in Part I, Item 1 of this Report.

Off-balance sheet financing arrangements

We have no obligations, assets or liabilities which would be considered off-balance sheet arrangements. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements.

We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or entered into any non-financial assets.

Contractual obligations

We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities other than an Administrative Services Agreement with the Clinton Group, Inc., pursuant to which the Company pays the Clinton Group, Inc. a total of $10,000 per month for office space, utilities and secretarial support. Upon completion of the Business Combination or the Company’s liquidation, the Company will cease paying these monthly fees.

Critical Accounting Policies

The preparation of financial statements and related disclosures in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates. The Company has identified the following as its critical accounting policies:

Loss per common share

Loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding for the period.

Income taxes

Deferred income tax assets and liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that will result in future taxable or deductible amounts, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

Recent accounting pronouncements

In June 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”) No. 2014-10, which eliminated certain financial reporting requirements of companies previously identified as “Development Stage Entities” (Topic 915). The amendments in this ASU simplify accounting guidance by removing all incremental financial reporting requirements for development stage entities. The amendments also reduce data maintenance and, for those entities subject to audit, audit costs by eliminating the requirement for development stage entities to present inception-to-date information in the statements of income, cash flows, and stockholder equity. Early application of each of the amendments is permitted for any annual reporting period or interim period for which the entity’s balance sheet has not yet been issued (public business entities) or made available for issuance (other entities). Upon adoption, entities will no longer present or disclose any information required by Topic 915. For public business entities, those amendments are effective for annual reporting periods beginning after December 15, 2014, and interim periods therein. The Company adopted ASU 2014-10 effective January 1, 2015. Adoption of this standard had no impact on the Company's financial position, results of operations or cash flows; however the presentation of the accompanying condensed interim financial statements does not present the disclosures that are no longer required.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are a blank check company incorporated on June 28, 2013, as a Delaware corporation and 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. Through June 30, 2015, our efforts have been limited to organizational activities, activities relating to our initial public offering, activities relating to identifying and evaluating prospective acquisition candidates and activities relating to general corporate matters. As of June 30, 2015, the Company did not hold any securities subject to market risk.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in company reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our Chairman of the Board and Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

As required by Rules 13a-15 and 15d-15 under the Exchange Act, our Chairman of the Board and Chief Executive Officer and Chief Financial Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of June 30, 2015. Based upon their evaluation, our Chairman of the Board and Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were effective.

During the most recently completed fiscal quarter, there has been no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II — OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

None.

ITEM 1A. RISK FACTORS

Other than the risk factors disclosed in the registration statement on Form F-4 filed with the SEC by Ascend Holdings on July 27, 2015 (which includes a preliminary proxy statement to be distributed to holders of our common stock and public warrants in connection with the solicitation by the Company of proxies for the vote by the stockholders on the Proposed Business Combination and the vote by the warrantholders on the proposed amendment to the warrant agreement), which are incorporated herein by reference, there have been no material changes to the risk factors disclosed in our Annual Report on Form 10-K for the year ended December 31, 2014. Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations. We may disclose changes to such factors or disclose additional factors from time to time in our future filings with the SEC.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

None.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q.

Exhibit
Number		Description
2.1		Agreement and Plan of Merger, dated July 23, 2015, by and among the Company, Ascend Telecom Infrastructure Private Limited, Ascend Telecom Holdings Limited and NSR PE Mauritius LLC (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K (File No. 1-36068) filed July 23, 2015).

31.1		Certification of the Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a).

31.2		Certification of the Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a).

32.1		Certification of the Chief Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350.

32.2		Certification of the Chief Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350.

101.INS		XBRL Instance Document.

101.SCH		XBRL Taxonomy Extension Schema Document.

101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document.

101.LAB		XBRL Taxonomy Extension Label Linkbase Document.

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document.

101.DEF		XBRL Taxonomy Extension Definition Document.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


	ROI ACQUISITION CORP. II

	Date: August 7, 2015

	/s/ Thomas J. Baldwin
	Name: Thomas J. Baldwin
	Title: Chairman of the Board and Chief Executive Officer
	(principal executive officer)

	/s/ Francis A. Ruchalski
	Name: Francis A. Ruchalski
	Title: Chief Financial Officer (principal financial officer)

ROI Acquisition Corp. II - FORM 10-Q - August 7, 2015

Attached files

ROI Acquisition Corp. II Reports