ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Trading Symbol
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Name of each exchange on which registered
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☐ Yes ☒ |
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
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☐ Yes ☒ |
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
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☒ |
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.
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☒ |
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).
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Large accelerated filer
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Accelerated filer
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Smaller reporting company
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Emerging growth company
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☐
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☐
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☒
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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.
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Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15
U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.
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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
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6
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Item 1. |
6 | ||
Item 1A.
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15
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Item 1B.
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45
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Item 2.
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45
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Item 3.
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45
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Item 4.
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45
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45
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Item 5.
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45
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Item 6.
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46
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Item 7.
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46
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Item 7a.
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49
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Item 8.
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49
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Item 9.
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49
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Item 9A.
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49
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Item 9B.
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50
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Item 9C.
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Disclosure Regarding Foreign Jurisdictions that Prevent Inspections |
50
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50
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Item 10.
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50
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Item 11.
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55
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Item 12.
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56
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Item 13.
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57
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Item 14.
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59
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60
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Item 15.
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60
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Item 16.
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61
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• |
our ability to select an appropriate target business or businesses;
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• |
our ability to complete our initial business combination, particularly given competition from other blank check companies and financial and strategic buyers;
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our expectations around the performance of the prospective target business or businesses including competitive prospects of the business following our initial business combination;
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our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business combination;
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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, as a result of which they would then receive expense
reimbursements;
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our potential ability to obtain additional financing to complete our initial business combination;
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our pool of prospective target businesses;
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our ability to consummate an initial business combination amidst the uncertainty resulting from the ongoing COVID-19 pandemic, and the effects of the ongoing pandemic on the financial technology sector, the economy and any business or
businesses with which we consummate our initial business combination;
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the ability of our officers and directors to generate a number of potential acquisition opportunities;
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our public securities’ liquidity and trading;
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the lack of a market for our securities;
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the use of funds not held in the trust account or available to us from interest income on the trust account balance;
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the trust account not being subject to claims of third parties;
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our financial performance; or
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the impacts of COVID-19.
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We are a recently formed company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective.
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The requirement that we complete our initial business combination within the prescribed timeframe may give potential target businesses leverage over us in negotiating an initial business combination and may decrease our ability to
conduct due diligence on potential business combination targets as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms that would produce value for our stockholders.
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Our search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the ongoing coronavirus (COVID-19) pandemic and the status of debt and
equity markets.
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We may not be able to complete our initial business combination within the prescribed timeframe, in which case we would cease all operations except for the purpose of winding up and we would redeem our public shares and liquidate, in
which case our public stockholders may only receive $10.00 per share, or less than such amount in certain circumstances, and our warrants will expire worthless.
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Because of our special purpose acquisition company structure and limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete our initial business combination. If
we do not complete our initial business combination, our public stockholders may receive only approximately $10.00 per share on our redemption of our public shares, or less than such amount in certain circumstances, and our warrants will
expire worthless.
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If the net proceeds of the initial public offering and the sale of the private placement warrants not being held in the trust account are insufficient, it could limit the amount available to fund our search for a target business or
businesses and complete our initial business combination and we will depend on loans from our sponsor or management team to fund our search for an initial business combination, to pay our franchise and income tax obligations and to complete
our initial business combination. If we are unable to obtain these loans, we may be unable to complete our initial business combination.
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If we have not completed an initial business combination within 24 months from the closing of the initial public offering, our public stockholders may be forced to wait beyond such 24 months before redemption from our trust account.
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We may complete one business combination with the proceeds of the initial public offering and the sale of the private placement warrants which will cause us to be solely dependent on a single business which may have a limited number of
services and limited operating activities. This lack of diversification may negatively impact our operating results and profitability.
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Nasdaq may delist our securities from trading on its exchange, which could limit investors’ ability to make transactions in our securities and subject us to additional trading restrictions.
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You will not be entitled to protections normally afforded to investors of many other blank check companies.
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If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.00 per share.
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The securities in which we invest the proceeds held in the trust account could bear a negative rate of interest, which could reduce the interest income available for payment of taxes or reduce the value of the assets held in trust such
that the per share redemption amount received by public stockholders may be less than $10.00 per share.
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We have identified a material weakness in our internal control over financial reporting. This material weakness could continue to adversely affect our ability to report our results of operations and financial condition accurately and in
a timely manner.
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We may seek business combination opportunities in industries or sectors which may or may not be outside of our management team’s area of expertise.
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Our officers, directors, security holders and their respective affiliates may have competitive pecuniary interests that conflict with our interests.
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We are dependent upon our officers and directors and their departure could adversely affect our ability to operate.
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Our key personnel may negotiate employment or consulting agreements as well as reimbursement of out-of-pocket expenses, if any, with a target business in connection with a particular business combination. These agreements may provide for
them to receive compensation or reimbursement for out-of-pocket expenses, if any, following our initial business combination and as a result, may cause them to have conflicts of interest in determining whether a particular business
combination is the most advantageous.
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Certain of our officers and directors are now, and all of them may in the future become, affiliated with entities engaged in business activities similar to those intended to be conducted by us and, accordingly, may have conflicts of
interest in allocating their time and determining to which entity a particular business opportunity should be presented.
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Our management may not be able to maintain control of a target business after our initial business combination.
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We may seek business combination opportunities with a financially unstable business or an entity lacking an established record of revenue, cash flow or earnings, which could subject us to volatile revenues, cash flows or earnings or
difficulty in retaining key personnel.
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The other risks and uncertainties discussed in “Risk Factors” and elsewhere in this Annual Report on Form 10-K.
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Item 1. |
Business
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Artificial intelligence and machine learning
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Digital wealth management
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Business process automation
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Application programing interfaces
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Cloud computing
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Digital assets and distributed ledger technologies
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Big data
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Is fundamentally sound and can unlock and enhance stockholder value through a combination with us, thereby offering attractive risk-adjusted returns for our stockholders;
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Is at an inflection point, such as requiring additional management expertise, and able to accelerate growth and financial performance through differentiated business models and the addition of our operational, financial, transactional
and legal expertise and networks;
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Is in need of a flexible, creative or opportunistic structure where we can deliver additional value;
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Has a strong, experienced management team, or provides a platform to assemble an effective management team with a track record of driving growth and profitability;
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Can benefit from being a publicly traded company, with access to broader capital markets, to achieve the business’ growth strategy;
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Is poised to grow both organically through the application of technology, as well as inorganically, through bolt-on or transformational acquisitions;
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Has a leading or niche market position and demonstrates advantages when compared to competitors, which may help to create barriers to entry against new competitors; and
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Exhibits unrecognized value or other characteristics that we believe can be enhanced based on our analysis and due diligence review.
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We anticipate offering the following benefits to our business combination partner:
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Partnership with our management team members who have extensive and proven experience in operating, leading, advising and investing in market-leading financial services and FinTech companies;
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Access to our deep and broad networks, insights and operational, financial, transactional, and legal and regulatory expertise;
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Increased company profile and improved credibility with investors, customers, suppliers and other key stakeholders;
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Higher level of engagement with core, relevant, fundamental investors as anchor stockholder than what a traditional IPO book-building process offers;
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Lower risk and expedited path to a public listing with flexible structuring;
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Infusion of cash and ongoing access to public capital markets;
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Listed public currency for future acquisitions and growth;
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Ability for management team to retain control and focus on growing the business; and
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Opportunity to motivate and retain employees using stock-based compensation.
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conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers, and
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file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is
required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies.
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conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and
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file proxy materials with the SEC.
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restrictions on the nature of our investments; and
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restrictions on the issuance of securities, each of which may make it difficult for us to complete our initial business combination.
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registration as an investment company;
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adoption of a specific form of corporate structure; and
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reporting, record keeping, voting, proxy and disclosure requirements and other rules and regulations.
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solely dependent upon the performance of a single business, property or asset, or
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dependent upon the development or market acceptance of a single or limited number of products, processes or services.
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higher costs and difficulties inherent in managing cross-border business operations and complying with different commercial and legal requirements of overseas markets;
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rules and regulations regarding currency redemption;
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complex corporate withholding taxes on individuals;
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laws governing the manner in which future business combinations may be effected;
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tariffs and trade barriers;
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regulations related to customs and import/export matters;
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longer payment cycles and challenges in collecting accounts receivable;
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tax issues, including but not limited to tax law changes and variations in tax laws as compared to the United States;
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currency fluctuations and exchange controls;
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rates of inflation;
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cultural and language differences;
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employment regulations;
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data privacy;
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changes in industry, regulatory or environmental standards within the jurisdictions where we operate;
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public health or safety concerns and governmental restrictions, including those caused by outbreaks of pandemic disease such as the COVID-19 pandemic;
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crime, strikes, riots, civil disturbances, terrorist attacks, natural disasters and wars;
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deterioration of political relations with the United States; and
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government appropriations of assets.
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a limited availability of market quotations for our securities;
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reduced liquidity for our securities;
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a determination that our Class A common stock is a “penny stock” which will require brokers trading in our Class A common stock to adhere to more stringent rules and possibly result in a reduced level of
trading activity in the secondary trading market for our securities;
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a limited amount of news and analyst coverage; and
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a decreased ability to issue additional securities or obtain additional financing in the future.
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default and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt obligations;
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acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain financial ratios or reserves without a waiver
or renegotiation of that covenant;
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our immediate payment of all principal and accrued interest, if any, if the debt is payable on demand;
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our inability to obtain necessary additional financing if the debt contains covenants restricting our ability to obtain such financing while the debt is outstanding;
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our inability to pay dividends on our common stock;
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using a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends on our common stock if declared, our ability to pay expenses, make capital expenditures and
acquisitions, and fund other general corporate purposes;
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limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate;
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increased vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation;
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limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, and execution of our strategy; and
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other disadvantages compared to our competitors who have less debt.
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we have a board that includes a majority of ‘independent directors,’ as defined under the rules of Nasdaq;
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we have a compensation committee of our board that is comprised entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and
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to the extent we have one, we have a nominating and corporate governance committee of our board that is comprised entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities.
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may significantly dilute the equity interest of investors in the initial public offering;
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may subordinate the rights of holders of common stock if preferred stock is issued with rights senior to those afforded our common stock;
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could cause a change of control if a substantial number of shares of our common stock are issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and could result in the resignation
or removal of our present officers and directors; and
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may adversely affect prevailing market prices for our units, Class A common stock and/or warrants.
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If the company or business we acquire provides products or services which relate to the facilitation of financial transactions, such as funds or securities settlement system, and such product or service fails or is compromised, we may be
subject to claims from both the firms to whom we provide our products and services and the clients they serve;
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If we are unable to keep pace with evolving technology and changes in the financial services industry, our revenues and future prospects may decline;
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Our ability to provide financial technology products and services to customers may be reduced or eliminated by regulatory changes;
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Any business or company we acquire could be vulnerable to cyberattack or theft of individual identities or personal data;
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Difficulties with any products or services we provide could damage our reputation and business;
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A failure to comply with privacy regulations could adversely affect relations with customers and have a negative impact on business;
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We may not be able to protect our intellectual property and we may be subject to infringement claims.
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Item 1B. |
Unresolved Staff Comments.
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Item 2. |
Properties.
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Item 3. |
Legal Proceedings.
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Item 4. |
Mine Safety Disclosures.
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Item 5. |
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuers Purchases of Equity Securities.
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Item 6. |
[Reserved]
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Item 7. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
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Item 7a. |
Quantitative and Qualitative Disclosures About Market Risk.
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Item 8. |
Financial Statements and Supplementary Data.
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Item 9. |
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.
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Item 9A. |
Controls and Procedures.
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(1)
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pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of our company,
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(2)
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provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with GAAP, and that our receipts and expenditures are being
made only in accordance with authorizations of our management and directors, and
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(3)
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provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the consolidated financial statements.
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Item 9B. |
Other Information.
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Item 9C. |
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
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Item 10. |
Directors, Executive Officers, and Corporate Governance.
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Name
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Age
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Title
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Mark Casady
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61
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Chairman of the Board of Directors
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Karl Roessner
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54
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Chief Executive Officer and Director
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Jon Isaacson
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51
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Chief Financial Officer and Chief Corporate Development Officer
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David Bergers
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54
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General Counsel
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Ryan Parker
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47
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Vice Chairman
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Asiff Hirji
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55
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Director
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Charles Roame
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56
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Director
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April Rudin
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61
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Director
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• |
assisting board oversight of (1) the integrity of our financial statements, (2) our compliance with legal and regulatory requirements, (3) the independent registered public accounting firm’s qualifications and independence and (4) the
performance of our internal audit function and the independent registered public accounting firm;
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the appointment, compensation, retention, replacement, and oversight of the work of the independent registered public accounting firm engaged by us;
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pre-approving all audit and permitted non-audit services to be provided by the independent registered public accounting firm engaged by us, and establishing pre-approval policies and procedures;
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setting clear hiring policies for employees or former employees of the independent registered public accounting firm, including but not limited to, as required by applicable laws and regulations;
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setting clear policies for audit partner rotation in compliance with applicable laws and regulations;
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obtaining and reviewing a report, at least annually, from the independent registered public accounting firm describing (i) the independent registered public accounting firm’s internal quality-control
procedures, (ii) any material issues raised by the most recent internal quality-control review, or peer review, of the audit firm, or by any inquiry or investigation by governmental or professional authorities within the preceding five
years respecting one or more independent audits carried out by the firm and any steps taken to deal with such issues and (iii) all relationships between the independent registered public accounting firm and us to assess the independent
registered public accounting firm’s independence;
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meeting to review and discuss our annual audited financial statements and quarterly financial statements with management and the independent registered public accounting firm, including reviewing our specific
disclosures under “Management’s Discussion and Analysis of Financial Condition and Results of Operations”;
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reviewing and approving any related party transaction required to be disclosed pursuant to Item 404 of Regulation S-K promulgated by the SEC prior to us entering into such transaction; and
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reviewing with management, the independent registered public accounting firm, and our legal advisors, as appropriate, any legal, regulatory or compliance matters, including any correspondence with regulators
or government agencies and any employee complaints or published reports that raise material issues regarding our financial statements or accounting policies and any significant changes in accounting standards or rules promulgated by the
Financial Accounting Standards Board, the SEC or other regulatory authorities.
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reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officer’s compensation, if any is paid by us, evaluating our Chief Executive Officer’s performance in light of such goals and
objectives and determining and approving the remuneration (if any) of our Chief Executive Officer based on such evaluation;
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reviewing and making recommendations on an annual basis to our board of directors with respect to (or approving, if such authority is so delegated by our board of directors) the compensation, if any is paid by us, and any
incentive-compensation and equity-based plans that are subject to board approval of our other officers;
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reviewing on an annual basis our executive compensation policies and plans;
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implementing and administering our incentive compensation equity-based remuneration plans;
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assisting management in complying with our proxy statement and annual report disclosure requirements;
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approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our officers and employees;
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if required, producing a report on executive compensation to be included in our annual proxy statement; and
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reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors.
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Item 11. |
Executive Compensation.
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Item 12. |
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
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• |
each person known by us to be the beneficial owner of more than 5% of our outstanding shares of common stock;
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• |
each of our officers and directors that beneficially owns shares of our common stock; and
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• |
all our officers, directors and director nominees as a group.
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Class A Common Stock
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Class B Common Stock(2)
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||||||||||||||||||
Name of Beneficial
Owner
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Number of
Shares
Beneficially
Owned
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Approximate
Percentage of
Class
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Number of
Shares
Beneficially
Owned
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Approximate
Percentage of
Class
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Approximate
Percentage of
Outstanding
Common
Stock
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|||||||||||||||
Lefteris Holdings LLC (1)
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-
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-
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5,087,474
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99.0
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%
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19.6
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%
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|||||||||||||
Mark Casady (1)
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-
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-
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5,087,474
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99.0
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%
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19.6
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%
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|||||||||||||
Karl Roessner
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-
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-
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-
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-
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-
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|||||||||||||||
Jon Isaacson
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-
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-
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-
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-
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-
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|||||||||||||||
David Bergers
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-
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-
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-
|
-
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-
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|||||||||||||||
Ryan Parker
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-
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-
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-
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-
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||||||||||||||||
Asiff Hirjii (2)
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-
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-
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30,000
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*
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*
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|||||||||||||||
Charles Roame (2)
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-
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-
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30,000
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*
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*
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|||||||||||||||
April Rudin(2)
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-
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-
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30,000
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*
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*
|
|||||||||||||||
BIP GP (3)
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1,900,000
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9.2
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%
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|||||||||||||||||
Glazer Capital, LLC (4)
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1,390,116
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6.7
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%
|
-
|
-
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-
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||||||||||||||
Sculptor Capital LP (5)
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1,409,540
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6.8
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%
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-
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-
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-
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||||||||||||||
All officers, directors and director nominees as a group (8 individuals)
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-
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-
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5,177,474
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100.0
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%
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19.8
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%
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Item 13. |
Certain Relationships and Related Transactions, and Director Independence.
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• |
Repayment of a loan of up to an aggregate of $250,000 made to us by our sponsor to cover offering related and organizational expenses;
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• |
Reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination;
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• |
Payment to our Chief Financial Officer of $350,000 per annum for his services prior to the consummation of our initial business combination, subject to the terms of a strategic services agreement that we will enter into with Mr.
Isaacson prior to the consummation of the initial public offering;
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• |
Payment of $25,000 per annum for a subscription service with Tiburon Strategic Advisors, of which Charles Roame, one of our independent directors, is a managing partner. The subscription entitles us to participate in weekly research
calls and receive written research reports that we believe will be useful in our business combination research; and
|
• |
Repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination, the terms of which
have not been determined nor have any written agreements been executed with respect thereto. Up to $2,000,000 of such loans may be convertible into warrants, at a price of $1.50 per warrant at the option of the lender.
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Item 14. |
Principal Accountant Fees and Services.
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Item 15. |
Exhibits and Financial Statement Schedules.
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Page
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|
Report of Independent Registered Public Accounting Firm
|
F-2
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Balance Sheets
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F-3
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Statements of Operations
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F-4
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Statements of Changes in Stockholders’ Deficit
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F-5
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Statements of Cash Flows
|
F-6
|
Notes to Financial Statements
|
F-7-F-20
|
Exhibit
number
|
Description of Exhibit
|
|
Second Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed on October 26, 2020 (File No. 001-39636)
|
||
Bylaws (incorporated by reference to Exhibit 3.3 to the Company’s Registration Statement on Form S-1, filed on October 2, 2020 (File No. 333-249290))
|
||
Warrant Agreement, dated October 20, 2020, between Continental Stock Transfer & Trust Company and the Company (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed
on October 26, 2020 (File No. 001-39636)
|
||
Specimen Unit Certificate (incorporated by reference to Exhibit 4.1 to the Company’s amended Form S-1, filed on October 13, 2020 (File No. 333-249290))
|
||
Specimen Class A Common Stock Certificate (incorporated by reference to Exhibit 4.2 to the Company’s amended Form S-1, filed on October 13, 2020 (File No. 333-249290))
|
||
Description of Registrant’s Securities (incorporated by reference to Exhibit 4.6 to the Company’s Annual Report on Form 10-K, filed on March 30, 2021 (File No. 001-39636))
|
||
Warrant Purchase Agreement, dated October 20, 2020, between the Company and Lefteris Holdings LLC (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on October 26,
2020 (File No. 001-39636))
|
||
Investment Management Trust Account Agreement, dated October 20, 2020, between Continental Stock Transfer & Trust Company and the Company (incorporated by reference to Exhibit 10.2 to the Company’s
Current Report on Form 8-K, filed on October 26, 2020 (File No. 001-39636)
|
||
Registration and Stockholder Right Agreement, dated October 20, 2020, between the Company and certain security holders (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K,
filed on October 26, 2020 (File No. 001-39636))
|
Letter Agreement, dated October 20, 2020, between the Company, Lefteris Holdings LLC, each of the officers and directors of the Company (incorporated by reference to Exhibit 10.4 to the Company’s Current
Report on Form 8-K, filed on October 26, 2020 (File No. 001-39636))
|
||
Form of Indemnity Agreement, dated October 20, 2020, between the Company and each of the officers and directors of the Company (incorporated by reference to Exhibit 10.5 to the Company’s Current Report on
Form 8-K, filed on October 26, 2020 (File No. 001-39636))
|
||
Code of Business Conduct and Ethics
|
||
Power of Attorney (included on signature page)
|
||
Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
||
Certification of Principal Financial Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
||
Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
||
Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
||
101
|
Interactive Data File
|
*
|
Filed herewith.
|
**
|
Furnished herewith
|
Item 16. |
Form 10-K Summary.
|
|
By:
|
/s/ Karl Roessner
|
|
|
|
Name: Karl Roessner
|
|
|
|
Title: Chief Executive Officer
|
Signature
|
Title
|
Date
|
||
/s/ Mark Casady
|
Chairman of the Board of Directors
|
March 31, 2022
|
||
Mark Casady
|
||||
/s/ Karl Roessner
|
Chief Executive Officer and Director (Principal Executive Officer)
|
March 31, 2022
|
||
Karl Roessner
|
||||
/s/ Jon Isaacson
|
Chief Financial Officer and Chief Corporate Development Officer (Principal Financial Officer and Principal Accounting Officer)
|
March 31, 2022
|
||
Jon Isaacson
|
||||
/s/ David Bergers
|
General Counsel
|
March 31, 2022
|
||
David Bergers
|
||||
/s/ Ryan Parker
|
Vice Chairman
|
March 31, 2022
|
||
Ryan Parker
|
||||
/s/ April Rudin
|
Director
|
March 31, 2022
|
||
April Rudin
|
||||
/s/ Asiff Hirji
|
Director
|
March 31, 2022
|
||
Asiff Hirji
|
||||
/s/ Charles Roame
|
Director
|
March 31, 2022
|
||
Charles Roame
|
Report of Independent Registered Public Accounting Firm
|
F-2
|
Financial Statements:
|
|
Balance Sheets
|
F-3
|
Statements of Operations
|
F-4
|
Statements of Changes in Stockholders’ Deficit
|
F-5
|
Statements of Cash Flows
|
F-6
|
Notes to Financial Statements
|
F-7 to F-20
|
/s/
|
|
December 31, |
||||||||
2021 |
2020 | |||||||
ASSETS | ||||||||
Current assets
|
||||||||
Cash
|
$
|
|
$ | |||||
Due from Sponsor
|
|
|||||||
Prepaid expenses
|
|
|||||||
Total Current Assets
|
|
|||||||
Investments held in Trust Account
|
|
|||||||
Total Assets
|
$
|
|
$ | |||||
LIABILITIES, CLASS A COMMON STOCK SUBJECT TO POSSIBLE REDEMPTION AND STOCKHOLDERS’ DEFICIT
|
||||||||
Current liabilities
|
||||||||
Accrued expenses
|
$
|
|
$ | |||||
Accrued offering costs
|
|
|||||||
Advances from related parties
|
|
|||||||
Total Current Liabilities
|
|
|||||||
Warrant liability
|
|
|||||||
Deferred underwriting fee payable
|
|
|||||||
Total Liabilities
|
|
|||||||
Commitments and Contingencies
|
||||||||
Class A common stock subject to possible redemption,
|
|
|||||||
Stockholders’ Deficit
|
||||||||
Preferred stock, $
|
|
|||||||
Class A common stock, $
|
|
|||||||
Class B common stock, $
|
|
|||||||
Additional paid-in capital
|
|
|||||||
Accumulated deficit
|
(
|
)
|
( |
) | ||||
Total Stockholders’ Deficit
|
(
|
)
|
( |
) | ||||
Total Liabilities, Class A Common Stock Subject to Possible Redemption and Stockholders’ Deficit
|
$
|
|
$ |
For Year Ended December 31, |
For the Period
from August 20,
2020 (inception)
through
December 31,
|
|||||||
2021 |
2020 |
|||||||
General and administrative expenses
|
$
|
|
$ | |||||
Loss from operations
|
(
|
)
|
( |
) | ||||
Other income (expense):
|
||||||||
Interest earned on investments held in Trust Account
|
|
|||||||
Transaction Costs
|
( |
) | ||||||
Change in fair value of warrant liabilities
|
|
( |
) | |||||
Total other income (expense), net
|
|
( |
) | |||||
Income (loss) before provision for income taxes |
( |
) | ||||||
Benefit (provision) for income taxes |
||||||||
Net income (loss)
|
$
|
|
$ | ( |
) | |||
Basic and Diluted weighted average shares outstanding of Class A common stock
|
|
|||||||
Basic and diluted net income (loss) per share, Class A common stock
|
$
|
|
$ | ( |
) | |||
Basic and diluted weighted average shares outstanding of Class B common stock
|
|
|||||||
Basic and diluted net income (loss) per share, Class B common stock
|
$
|
|
$ | ( |
) |
Class A
Common Stock
|
Class B
Common Stock
|
Additional
Paid-in
|
Accumulated |
Total
Stockholders’
|
||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Capital
|
Deficit
|
Deficit
|
||||||||||||||||||||||
Balance – August 20, 2020 (Inception)
|
|
$
|
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||
Issuance of Class B common stock to Sponsor
|
—
|
—
|
|
|
|
|
|
|||||||||||||||||||||
Accretion for Class A common stock to redemption amount
|
—
|
—
|
—
|
—
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||||||||||||
Sale of |
—
|
—
|
—
|
|
|
|
||||||||||||||||||||||
Forfeiture of Founder Shares
|
—
|
—
|
(
|
)
|
(
|
)
|
|
|
|
|||||||||||||||||||
Net loss
|
—
|
|
—
|
|
|
(
|
)
|
(
|
)
|
|||||||||||||||||||
Balance – December 31, 2020
|
|
$
|
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
||||||||||||||
Net income |
— | — | ||||||||||||||||||||||||||
Balance – December 31, 2021
|
$ |
$ |
$ |
$ |
( |
) | $ |
( |
) |
For Year Ended December 31, |
For the Period
from August 20,
2020 (inception)
through
December 31,
|
|||||||
2021 | 2020 | |||||||
Cash Flows from Operating Activities:
|
||||||||
Net income (loss)
|
$
|
|
$ | ( |
) | |||
Adjustments to reconcile net income (loss) to net cash used in operating activities:
|
||||||||
Change in fair value of warrant liabilities
|
(
|
)
|
||||||
Transaction costs allocated to warrants
|
|
|||||||
Interest earned on investments held in Trust Account
|
(
|
)
|
( |
) | ||||
Changes in operating assets and liabilities:
|
||||||||
Prepaid expenses
|
|
( |
) | |||||
Accounts payable and accrued expenses
|
|
|||||||
Net cash used in operating activities
|
(
|
)
|
( |
) | ||||
Cash Flows from Investing Activities:
|
||||||||
Investment of cash in Trust Account
|
|
( |
) | |||||
Net cash used in investing activities
|
|
( |
) | |||||
Cash Flows from Financing Activities:
|
||||||||
Proceeds from issuance of Class B common stock to Sponsor
|
||||||||
Proceeds from sale of Units, net of underwriting discounts paid
|
|
|||||||
Proceeds from sale of Private Placements Warrants
|
|
|||||||
Advances from related party |
|
|||||||
Proceeds from promissory note - related party
|
|
|||||||
Repayment of promissory note - related party
|
(
|
)
|
||||||
Payment of offering costs
|
(
|
)
|
( |
) | ||||
Due from sponsor |
( |
) | ||||||
Net cash provided by financing activities
|
|
|||||||
Net Change in Cash
|
(
|
)
|
||||||
Cash – Beginning of period
|
|
|||||||
Cash – End of period
|
$
|
|
$ | |||||
Non-Cash investing and financing activities:
|
||||||||
Deferred underwriting fee payable
|
$
|
|
$ | |||||
Offering costs included in accrued offering costs
|
$
|
|
$ | |||||
Offering costs paid through promissory note
|
$
|
|
$ | |||||
Forfeiture of Founder Shares
|
$
|
|
$ | ( |
) |
Gross proceeds
|
$
|
|
||
Less:
|
|
|||
Proceeds allocated to Public Warrants
|
|
(
|
)
|
|
Class A common stock issuance costs
|
|
(
|
)
|
|
Plus:
|
||||
Accretion of carrying value to redemption value
|
|
|
||
Class A common stock subject to possible redemption
|
$
|
|
Year Ended
December 31, 2021
|
For the period from
August 20, 2020 (inception)
Through December 31, 2020
|
|||||||||||||||
Class A
|
Class B
|
Class A
|
Class B
|
|||||||||||||
Basic
and diluted net income (loss) per common share
|
||||||||||||||||
Numerator:
|
||||||||||||||||
Allocation of net income (loss), as adjusted
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
||||||
Denominator:
|
||||||||||||||||
Basic and diluted weighted average common shares outstanding
|
|
|
|
|
||||||||||||
Basic and diluted net income (loss) per common share
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
|
• |
Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets;
|
|
• |
Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices
for identical or similar instruments in markets that are not active; and
|
|
• |
Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in
which one or more significant inputs or significant value drivers are unobservable.
|
● |
in whole and not in part;
|
● |
at a price of $
|
● |
Upon a minimum of
|
● |
if,
and only if, the last reported sale price of the Class A common stock for any
|
● |
in whole and not in part;
|
● |
at a price of $
|
● |
if, and
only if, the Reference Value equals or exceeds $
|
● |
if the
Reference Value is less than $
|
December 31,
2021
|
December 31,
2020
|
|||||||
Deferred tax asset (liability)
|
||||||||
Net operating loss carryforward
|
$
|
|
$ | |||||
Business combination expenses
|
||||||||
Startup/Organization Expenses
|
|
|||||||
Total deferred tax assets, net
|
|
|||||||
Valuation Allowance
|
(
|
)
|
( |
) | ||||
Deferred tax liability, net of valuation allowance
|
$
|
|
$ |
December 31,
2021
|
December 31,
2020
|
|||||||
Federal
|
||||||||
Current
|
$
|
|
$ | |||||
Deferred
|
(
|
)
|
( |
) | ||||
State and Local
|
||||||||
Current
|
|
|
||||||
Deferred
|
|
|||||||
Change in valuation allowance
|
|
|||||||
Income tax provision
|
$
|
|
$ |
December 31,
2021
|
December 31,
2020
|
|||||||
Statutory federal income tax rate
|
|
%
|
% | |||||
State taxes, net of federal tax benefit
|
|
%
|
% | |||||
Change in fair value of warrants
|
(
|
)%
|
( |
)% | ||||
Change in valuation allowance
|
|
%
|
( |
)% | ||||
Income tax provision
|
|
%
|
% |
|
Level 1:
|
Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for
the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.
|
|
Level 2:
|
Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and
quoted prices for identical assets or liabilities in markets that are not active.
|
|
Level 3:
|
Unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived
from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
|
|
Held-To-Maturity
|
Level
|
Amortized
Cost
|
Gross
Holding
Gain
|
Fair Value
|
||||||||||||
December 31, 2020
|
U.S. Treasury Securities (Matured on
|
1
|
$
|
|
$
|
|
$
|
|
Description |
Level
|
December 31,
2021
|
December 31,
2020
|
|||||||||
Assets:
|
||||||||||||
Investments held in Trust Account
|
1
|
|
|
|||||||||
Liabilities:
|
||||||||||||
Warrant Liability – Public Warrants
|
1
|
|
|
|||||||||
Warrant Liability – Private Placement Warrants
|
3
|
|
|
As of
December 31,
2021 |
At
December 31,
2020
|
|||||||
Stock price
|
$
|
|
$
|
|
||||
Strike price
|
$
|
|
$
|
|
||||
Volatility
|
|
%
|
|
%
|
||||
Risk-free rate
|
|
%
|
|
%
|
||||
Time until Business Combination occurring (years)
|
|
|
||||||
Dividend yield
|
|
%
|
|
%
|
Fair value as of August 20, 2020 (inception)
|
$ | |||
Initial measurement on October 23, 2020 (including overallotment)
|
||||
Change in valuation inputs or other assumptions
|
||||
Transfer out of level 3
|
( |
) | ||
Fair value as of December 31, 2020
|
$
|
|
||
Change in valuation inputs or other assumptions
|
(
|
)
|
||
Fair value as of December 31, 2021
|
$
|
|
1. |
I have reviewed this annual report on Form 10-K of Lefteris Acquisition Corp. (the “registrant”);
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report;
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and
for, the periods presented in this report;
|
4. |
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e) and internal control over financial reporting
(as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and
the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c) |
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by
this report based on such evaluation; and
|
(d) |
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report)
that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5. |
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors
(or persons performing the equivalent functions):
|
(a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and
report financial information; and
|
(b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: March 31, 2022
|
By:
|
/s/ Karl Roessner
|
Karl Roessner
|
||
President, Chief Executive Officer, and Director
|
||
(Principal Executive Officer)
|
1. |
I have reviewed this annual report on Form 10-K of Lefteris Acquisition Corp. (the “registrant”);
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report;
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and
for, the periods presented in this report;
|
4. |
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e) and internal control over financial reporting
(as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and
the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c) |
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by
this report based on such evaluation; and
|
(d) |
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report)
that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5. |
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors
(or persons performing the equivalent functions):
|
(a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and
report financial information; and
|
(b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: March 31, 2022
|
By:
|
/s/ Jon Isaacson
|
Jon Isaacon
|
||
Chief Financial Officer and Chief Corporate Development officer
|
||
(Principal Financial Officer and Principal Accounting Officer)
|
Date: March 31, 2022
|
By:
|
/s/ Karl Roessner
|
Karl Roessner
|
||
President, Chief Executive Officer, and Director
|
||
(Principal Executive Officer)
|
Date: March 31, 2022
|
By:
|
/s/ Jon Isaacson
|
Jon Isaacson
|
||
Chief Financial Officer and Chief Corporate Development officer
|
||
(Principal Financial Officer and Principal Accounting Officer)
|
STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT - USD ($) |
Common Stock [Member]
Class A Common Stock [Member]
|
Common Stock [Member]
Class B Common Stock [Member]
|
Additional Paid-in Capital [Member] |
Accumulated Deficit [Member] |
Total |
Class A Common Stock [Member] |
Class B Common Stock [Member] |
---|---|---|---|---|---|---|---|
Beginning balance at Aug. 19, 2020 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | ||
Beginning balance (in shares) at Aug. 19, 2020 | 0 | 0 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of Class B common stock to Sponsor | $ 575 | 24,425 | 0 | 25,000 | |||
Issuance of Class B common stock to Sponsor (in shares) | 5,750,000 | ||||||
Accretion for Class A common stock to redemption amount | (1,589,537) | (17,398,709) | (18,988,246) | ||||
Sale of 4,094,653 Private Placement Warrants | $ 0 | 1,565,055 | 0 | 1,565,055 | |||
Forfeiture of Founder Shares | $ (57) | 57 | 0 | 0 | |||
Forfeiture of Founder Shares (in shares) | (572,527) | ||||||
Net income (loss) | $ 0 | $ 0 | 0 | (12,874,353) | (12,874,353) | $ (8,950,276) | $ (3,924,077) |
Ending balance at Dec. 31, 2020 | $ 0 | $ 518 | 0 | (30,273,062) | (30,272,544) | ||
Ending balance (in shares) at Dec. 31, 2020 | 0 | 5,177,473 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | $ 0 | $ 0 | 0 | 11,657,463 | 11,657,463 | $ 9,325,971 | $ 2,331,492 |
Ending balance at Dec. 31, 2021 | $ 0 | $ 518 | $ 0 | $ (18,615,599) | $ (18,615,081) | ||
Ending balance (in shares) at Dec. 31, 2021 | 0 | 5,177,473 |
STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT (Parenthetical) - shares |
4 Months Ended | |
---|---|---|
Oct. 23, 2020 |
Dec. 31, 2020 |
|
Private Placement Warrants [Member] | ||
Stockholders' Equity | ||
Warrants issued (in shares) | 4,000,000 | 4,094,653 |
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS |
12 Months Ended |
---|---|
Dec. 31, 2021 | |
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS [Abstract] | |
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS |
NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS
Lefteris Acquisition Corp. (the “Company”) was incorporated in Delaware on August 20, 2020. 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 is not limited to a particular industry or sector for purposes of consummating a Business Combination. The Company is an early
stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies.
As of December 31, 2021, the Company had not commenced any operations. All activity for the period from August 20, 2020 (inception) through
December 31, 2021 relates to the Company’s formation and the initial public offering (“Initial Public Offering”), which is described below, and subsequent to the Initial Public Offering, identifying a target company for a Business
Combination. The Company will not generate any operating revenues until after the completion of its initial Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income its investments.
The registration statement for the Company’s Initial Public Offering was declared effective on October 20, 2020. On October 23, 2020 the
Company consummated the Initial Public Offering of 20,000,000 units (the “Units” and, with respect to the Class A common stock
included in the Units sold, the “Public Shares”) at $10.00 per Unit, generating gross proceeds of $200,000,000 which is described in Note 3.
Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 4,000,000 warrants (the “Private Placement Warrants”) at a price of $1.50
per Private Placement Warrant in a private placement to Lefteris Holdings, LLC (the “Sponsor”), generating gross proceeds of $6,000,000,
which is described in Note 4.
Following the closing of the Initial Public Offering on October 23, 2020, an amount of $200,000,000 ($10.00 per Unit) from the net proceeds of the
sale of the Units in the Initial Public Offering and the sale of the Private Placement Warrants was placed in a trust account (the “Trust Account”), located in the United States and invested in U.S. government securities, within the meaning
set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 185 days or less or in any open-ended investment company that holds itself out as a money market fund selected
by the Company meeting certain conditions of Rule 2a-7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) the completion of a Business Combination and (ii) the distribution of the funds held in the Trust
Account, as described below.
On November 17, 2020, the Company consummated the sale of an additional 709,894 Units through the underwriters’ election to partially exercise their over-allotment option, at $10.00 per Unit, and the sale of an additional 94,653
Private Placement Warrants, at $1.50 per Private Warrant, generating total gross proceeds of $7,240,919. A total of $7,098,940 of
the net proceeds was deposited into the Trust Account, bringing the aggregate proceeds held in the Trust Account to $207,098,940.
Transaction costs charged to equity amounted to $11,808,264,
consisting of $4,141,979 in cash underwriting fees, $7,248,463 of deferred underwriting fees and $417,822 of other offering costs. Transaction costs
charged to equity amounted to $11,365,513. Transactions costs expensed as of the date of the Initial Public Offering totaled $442,751.
The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and
the sale of Private Placement Warrants, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. There is no assurance that the Company will be able to complete a Business
Combination successfully. The Company must complete one or more initial Business Combinations with one or more operating businesses or assets with a fair market value equal to at least 80% of the net assets held in the Trust Account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the Trust Account). The
Company will only complete a Business Combination if the post-transaction company owns or acquires 50% or more of the outstanding
voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act.
The Company will provide the holders of the outstanding Public Shares (the “Public Stockholders”) with the opportunity to redeem all or a
portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a stockholder meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the
Company will seek stockholder approval of a Business Combination or conduct a tender offer will be made by the Company. The Public Stockholders will be entitled to redeem their Public Shares for a pro rata portion of the amount then in the
Trust Account (initially anticipated to be $10.00 per Public Share, plus any pro rata interest then in the Trust Account, net of
taxes payable). There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s warrants.
The Company will only proceed with a Business Combination if the Company has net tangible assets of at least $5,000,001 following any related redemptions and, if the Company seeks stockholder approval, a majority of the shares voted are voted in favor of
the Business Combination. If a stockholder vote is not required by applicable law or stock exchange listing requirements and the Company does not decide to hold a stockholder vote for business or other reasons, the Company will, pursuant to
its Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”), conduct the redemptions pursuant to the tender offer rules of the U.S. Securities and Exchange Commission (“SEC”) and file tender offer documents with
the SEC prior to completing a Business Combination. If, however, stockholder approval of the transaction is required by applicable law or stock exchange listing requirements, or the Company decides to obtain stockholder approval for business
or other reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer rules. If the Company seeks stockholder approval in connection with a Business
Combination, the Sponsor has agreed to vote its Founder Shares (as defined in Note 5) and any Public Shares purchased during or after the Initial Public Offering in favor of approving a Business Combination. Additionally, each Public
Stockholder may elect to redeem their Public Shares without voting, and if they do vote, irrespective of whether they vote for or against the proposed transaction.
Notwithstanding the foregoing, if the Company seeks stockholder approval of a Business Combination and it does not conduct redemptions
pursuant to the tender offer rules, the Certificate of Incorporation will provide that a Public Stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group”
(as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the Public Shares, without the prior consent of the Company.
The Sponsor has agreed (a) to waive its redemption rights with respect to the Founder Shares and Public Shares held by it in connection with
the completion of a Business Combination and (b) not to propose an amendment to the Certificate of Incorporation (i) to modify the substance or timing of the Company’s obligation to allow redemptions in connection with a Business Combination
or to redeem 100% of its Public Shares if the Company does not complete a Business Combination within the Combination Period (as
defined below) or (ii) with respect to any other provision relating to stockholders’ rights or pre-business combination activity, unless the Company provides the Public Stockholders with the opportunity to redeem their Public Shares in
conjunction with any such amendment.
The Company will have until October 23, 2022 to complete a Business Combination (the “Combination Period”). If the Company has not completed a
Business Combination within the Combination Period, the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than
business days thereafter, redeem the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account,
including interest earned on the funds held in the Trust Account and not previously released to pay taxes (less up to $100,000 of
interest 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 liquidating
distributions, if any), 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. There will be no redemption rights or liquidating distributions with respect to the Company’s warrants, which
will expire worthless if the Company fails to complete a Business Combination within the Combination Period.The Sponsor has agreed to waive its liquidation rights with respect to the Founder Shares if the Company fails to complete a Business
Combination within the Combination Period. However, if the Sponsor acquires Public Shares in or after the Initial Public Offering, such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to
complete a Business Combination within the Combination Period. The underwriters have agreed to waive their rights to their deferred underwriting commission (see Note 6) held in the Trust Account in the event the Company does not complete a
Business Combination within the Combination Period and, in such event, such amounts will be included with the other funds held in the Trust Account that will be available to fund the redemption of the Public Shares. In the event of such
distribution, it is possible that the per share value of the assets remaining available for distribution will be less than the Initial Public Offering price per Unit ($10.00).
In order to protect the amounts held in the Trust Account, the Sponsor has agreed to be liable to the Company if and to the extent any claims
by a third party for services rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account to below the
lesser of (i) $10.00 per Public Share and (ii) the actual amount per Public Share held in the Trust Account as of the date of the
liquidation of the Trust Account, if less than $10.00 per public Share due to reductions in the value of the trust assets, less
taxes payable, provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to monies held in the Trust Account nor will it apply to any claims under the
Company’s indemnity of the underwriters of the Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Moreover, in the event that an executed waiver is
deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the
Trust Account due to claims of creditors by endeavoring to have all vendors, service providers (except for the Company’s independent registered public accounting firm), prospective target businesses and other entities with which the Company
does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account.
Going Concern Consideration
As the Company is within the one-year timeframe of mandatory liquidation, a going concern disclosure is
required. At December 31, 2021, the Company has $24,970 in its operating bank account, $207,171,108 in securities held in the Trust Account, to be for a Business Combination or to repurchase or redeem its ordinary shares in connection therewith and working
capital deficit of $2,794,688.
Until the consummation of a Business Combination, the Company will be using the funds not held in the Trust
Account for identifying and evaluating prospective acquisition candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to acquire, and structuring, negotiating,
and consummating the Business Combination.
In connection with the Company's assessment of going concern considerations in accordance with ASC Topic 205-40 Presentation of Financial Statements - Going Concern, the Company has until
October 23, 2022 to consummate a Business Combination. If a Business Combination is not consummated by this date and an extension not requested by the Sponsor, there will be a mandatory liquidation and subsequent dissolution of the
Company. Although the Company intends to consummate a Business Combination on or before October 23, 2022, it is uncertain that the Company will be able to consummate a Business Combination by this time. Management has determined that
should a Business Combination not occur and an extension is not requested by the Sponsor, and potential subsequent dissolution raises substantial doubt about the Company's ability to continue as a going concern. The Company's plan is
to complete a business combination or obtain an extension on or prior to October 23, 2022, however it is uncertain that the Company will be able to consummate a Business Combination or obtain an extension by this time. No adjustments
have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate after October 23, 2022.
If the Business Combination is
not consummated, the Company will need to raise additional capital through loans or additional investments from its Sponsor, stockholders, officers, directors, or third parties. The Company’s officers, directors and Sponsor may, but are
not obligated to, loan the Company funds, from time to time or at any time, in whatever amount they deem reasonable in their sole discretion, to meet the Company’s working capital needs. Accordingly, the Company may not be able to obtain
additional financing. If the Company is unable to raise additional capital, it may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending
the pursuit of a potential transaction, and reducing overhead expenses. The Company cannot provide any assurance that new financing will be available to it on commercially acceptable terms, if at all. In connection with the Company’s assessment of going concern considerations in accordance with FASB’s Accounting Standards Update (“ASU”) 2014-15, “Disclosures of
Uncertainties about an Entity’s Ability to Continue as a Going Concern,” management has determined that if the Company is unable to complete a Business Combination by October 23, 2022, then the Company will cease all operations except for
the purpose of liquidating. The date for mandatory liquidation and subsequent dissolution coupled with the working capital deficit raises
substantial doubt about the Company’s ability to continue as a going concern through one year from the date of these financial statements if a Business Combination is not consummated. These financial statements do not include any
adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.
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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying financial statements are presented in U.S. dollars and 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 (the “SEC”).
Emerging Growth Company
The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business
Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not
being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and
proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.
Further, 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 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. 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.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires the Company’s 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 financial statements and the reported amounts of expenses during the reporting period.
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a
condition, situation or set of circumstances that existed at the date of the financial statement, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. One of the
more significant accounting estimates included in these financial statements is the determination of the fair value of the warrant liability. Such estimates may be subject to change as more current information becomes available and
accordingly the actual results could differ significantly from those estimates.
Cash and Cash Equivalents
The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The
Company did not have any cash equivalents as of December 31, 2021 and 2020.
Class A Common Stock Subject to Possible Redemption
The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards
Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common
stock (including common stock that feature redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary
equity. At all other times, common stock is classified as stockholders’ equity. The Company’s Class A common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of
uncertain future events. Accordingly, shares of Class A common stock subject to possible redemption are presented as temporary equity, outside of the stockholders’ equity section of the Company’s balance sheets.
The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of
redeemable common stock to equal the redemption value at the end of each reporting period. Immediately upon the closing of the Initial Public Offering, the Company recognized the accretion from initial book value to redemption amount value.
The change in the carrying value of redeemable Class A common stock resulted in charges against additional paid-in capital and accumulated deficit.
At December 31, 2021 and 2020, the Class A common stock reflected in the balance sheets are reconciled in the following table:
Offering Costs
Offering costs consisted of legal, accounting and other expenses incurred through the Initial Public
Offering that were directly related to the Initial Public Offering. Offering costs were allocated to the separable financial instruments issued in the Initial Public Offering based on a relative fair value basis, compared to total proceeds
received. Offering costs allocated to warrant liabilities were expensed as incurred in the statements of operations. Offering costs associated with the Class A common stock issued were initially charged to temporary equity and then accreted
to common stock subject to redemption upon the completion of the Initial Public Offering (see Note 1).
Warrant Liabilities
The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency
risks. The Company evaluates all of its financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480 and
Financial Accounting Standards Board (“FASB”) ASC Topic 815, “Derivatives and Hedging” (“ASC 815”). The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s
specific terms and applicable authoritative guidance in FASB ASC 480, Distinguishing Liabilities from Equity and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial
instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the
Company’s own ordinary shares, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end
date while the warrants are outstanding.
For issued or modified warrants that meet all of the criteria for equity classification, the warrants are
required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their
initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the statements of operations. The fair value of the private
warrants was estimated using a Black-Scholes Model and the public warrants were valued using the exchange traded price as of the valuation date (see Note 10).
Income Taxes
The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and
liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in
tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The Company had deferred tax assets
of approximately $909,000 and $156,000
as of December 31, 2021 and 2020, respectively, each of which has a full valuation allowance recorded against them.
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. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2021 and 2020. The Company is currently not aware of any issues under review
that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception.
The provision for income taxes was deemed to be de minimis for the year ended December 31, 2021 and for the period from August 20, 2020
(inception) through December 31, 2020.
Net Income (Loss) per Common Share
The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share”.
Net income (loss) per common stock is computed by dividing net income (loss) by the weighted average number of common stock outstanding for the period. The Company has two classes of common stock, which are referred to as Class A common
stock and Class B common stock. Income and losses are shared pro rata between the two classes of common stock. Accretion associated with the redeemable shares of Class A common stock is excluded from earnings per share as the redemption
value approximates fair value.
The calculation of diluted net income (loss) per share does not consider the effect of the warrants issued in
connection with the (i)Initial Public Offering, and (ii)the private placement warrants since the exercise of the warrants is contingent upon the occurrence of future events. As of December 31, 2021 and 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. As a result, diluted net income (loss) per common share is the same as basic net
income (loss) per common share for the periods presented.
The following table reflects the calculation of basic and diluted net income (loss) per common stock (in dollars, except per share amounts):
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial
institution, which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on this account and management believes the Company is not exposed to significant risks on such account.
Fair Value of Financial Instruments
The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC 820, “Fair Value Measurement,”
approximates the carrying amounts represented in the accompanying balance sheets, primarily due to their short-term nature.
Fair Value Measurements
Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction
between market participants at the measurement date. U.S. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in
active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include:
In some circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In
those instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement.
Derivative Financial Instruments
The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded
derivatives in accordance with ASC Topic 815, “Derivatives and Hedging”. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value on the grant date and is
then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity,
is evaluated at the end of each reporting period. Derivative liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required within 12
months of the balance sheet date.
Recent Accounting Standards
In August 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20)
and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial
conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces
additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted
method for all convertible instruments. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company is currently assessing
the impact, if any, that ASU 2020-06 would have on its financial position, results of operations or cash flows.
Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material
effect on the Company’s financial statements.
|
INITIAL PUBLIC OFFERING |
12 Months Ended |
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Dec. 31, 2021 | |
INITIAL PUBLIC OFFERING [Abstract] | |
INITIAL PUBLIC OFFERING |
NOTE 3. INITIAL PUBLIC OFFERING
Pursuant to the Initial Public Offering, the Company sold 20,709,894 Units, at a price of $10.00 per Unit, inclusive of 709,894 Units sold to the underwriters on November 17, 2020 upon the underwriters’ election to partially exercise their over-allotment option.
Each Unit consists of one share of Class A common stock and
of one redeemable warrant (“Public Warrant”).
Each whole Public Warrant entitles the holder to purchase one share of Class A common stock at a price of $11.50 per share, subject
to adjustment (see Note 8). |
PRIVATE PLACEMENT |
12 Months Ended |
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Dec. 31, 2021 | |
PRIVATE PLACEMENT [Abstract] | |
PRIVATE PLACEMENT |
NOTE 4. PRIVATE PLACEMENT
Simultaneously with the closing of the Initial Public Offering, the Sponsor purchased an aggregate of 4,000,000 Private Placement Warrants at a price of $1.50
per Private Placement Warrant, generating proceeds of $6,000,000 in the aggregate. On November 17, 2020, in connection with the
underwriters’ election to partially exercise their over-allotment option, the Company sold an additional 94,653 Private Placement
Warrants to the Sponsor, at a price of $1.50 per Private Placement Warrant, generating gross proceeds of $141,979. Each Private Placement Warrant is exercisable to purchase one share of Class A common stock at a price of $11.50 per share, subject to adjustment (see Note
8). The proceeds from the sale of the Private Placement Warrants were added to the net proceeds from the Initial Public Offering held in the Trust Account. If the Company does not complete a Business Combination within the Combination Period,
the proceeds from the sale of the Private Placement Warrants held in the Trust Account will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Placement Warrants will expire
worthless.
|
RELATED PARTY TRANSACTIONS |
12 Months Ended |
---|---|
Dec. 31, 2021 | |
RELATED PARTY TRANSACTIONS [Abstract] | |
RELATED PARTY TRANSACTIONS |
NOTE 5. RELATED PARTY TRANSACTIONS
Founder Shares
During the period ended September 4, 2020, the Sponsor purchased 5,031,250 shares (the “Founder Shares”) of the Company’s Class B common stock for an aggregate price of $25,000. On September 16, 2020, the Company effected a stock dividend resulting in 6,468,750 Founder Shares being issued and outstanding. On October 20, 2020, the Company canceled 718,750
Founder Shares, resulting in an aggregate of 5,750,000 Founder Shares being issued and outstanding. In September 2020, the
Sponsor transferred 20,000 Founder Shares to each of the Company’s independent directors. As a result of the underwriters’
election to partially exercise their over-allotment option on November 17, 2020, a total of 177,473 Founder Shares are no longer
subject to forfeiture and 572,527 Founder Shares were forfeited, resulting in an aggregate of 5,177,473 Founder Shares issued and outstanding.
The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of the Founder Shares until the earlier to occur
of: (A) one year after the completion of a Business Combination and (B) subsequent to a Business Combination, (x) if the last
reported sale price of the Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock
capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150
days after a Business Combination, or (y) the date on which the Company completes a liquidation, merger, capital stock exchange or other similar transaction that results in all of the Public Stockholders having the right to exchange their
shares of common stock for cash, securities or other property.
Advances from Related Party and Due to Sponsor
The Sponsor paid for certain operating costs on behalf of the Company amounting to $236,779 and $170,337 as of
December 31, 2021 and December 31, 2020, respectively. The advances are non-interest bearing and are due on demand.
Related Party Loans
In order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the
Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the
proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a
portion of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital
Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s
discretion, up to $2,000,000 of such Working Capital Loans may be convertible into warrants of the post-Business Combination entity
at a price of $1.50 per warrant. The warrants would be identical to the Private Placement Warrants. At December 31, 2020, no such
Working Capital Loans were outstanding. At December 31, 2021 and 2020, no such Working Capital Loans were outstanding.
|
COMMITMENTS AND CONTINGENCIES |
12 Months Ended |
---|---|
Dec. 31, 2021 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
COMMITMENTS AND CONTINGENCIES |
NOTE 6. COMMITMENTS AND CONTINGENCIES
Risks and Uncertainties
Management continues to evaluate the impact of the COVID-19 pandemic on the industry and has concluded that while it is reasonably possible
that the virus could have a negative effect on the Company’s financial position, results of its operations and/or search for a target company, the specific impact is not readily determinable as of the date of these financial statements. The
financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Registration and Stockholder Rights
Pursuant to a registration rights agreement entered into on October 20, 2020, the holders of the Founder Shares, Private Placement Warrants
and warrants that may be issued upon conversion of Working Capital Loans (and any Class A common stock issuable upon the exercise of the Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans and
upon conversion of the Founder Shares) will be entitled to registration rights pursuant to a registration and stockholder rights agreement requiring the Company to register such securities for resale (in the case of the Founder Shares, only
after conversion to the Company’s Class A common stock). The holders of the majority of these securities are entitled to make up to three
demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of a Business
Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. The registration rights agreement does not contain liquidated damages or other cash settlement provisions
resulting from delays in registering our securities. The Company will bear the expenses incurred in connection with the filing of any such registration statements.
Underwriting Agreement
The underwriters are entitled to a deferred fee of $0.35 per Unit, or $7,248,463 in the aggregate. The deferred fee will
become payable to the underwriters from the amounts held in the Trust Account solely in the event that the Company completes a Business Combination, subject to the terms of the underwriting agreement.
|
STOCKHOLDERS' EQUITY |
12 Months Ended |
---|---|
Dec. 31, 2021 | |
STOCKHOLDERS' EQUITY [Abstract] | |
STOCKHOLDER'S EQUITY |
NOTE 7. STOCKHOLDERS’ EQUITY
Preferred Stock — The Company is authorized to issue 1,000,000 shares of preferred stock with a par value of $0.0001 per share with such designations, voting and other rights and preferences as may
be determined from time to time by the Company’s board of directors. At December 31, 2021 and 2020, there were no shares of preferred stock issued or outstanding.
Class A Common Stock — The Company is authorized to issue 100,000,000 shares of Class A common stock with a par value of $0.0001 per share. Holders of Class A common stock are entitled to one vote for each share. At December 31, 2021 and 2020, there were 20,709,894 shares of Class A common stock issued and outstanding all of which are presented as temporary equity.
Holders of Class A common stock and holders of Class B common stock will vote together as a single class on all matters submitted to a vote of our stockholders except as otherwise required by law. The shares of Class B common stock
will automatically convert into Class A common stock concurrently with or immediately following the consummation of a Business Combination on a one-for-one
basis, subject to adjustment. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in Initial Public Offering and related to the closing of a
Business Combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such
adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of (i) the total number of all shares of common stock outstanding upon completion of the Initial Public Offering, plus (ii) all
shares of Class A common stock and equity-linked securities issued or deemed issued in connection with a Business Combination (excluding any shares of Class A common stock or equity-linked securities issued, or to be issued, to any seller in
a Business Combination, and any private placement-equivalent warrants issued to the Sponsor or its affiliates upon conversion of loans made to the Company). The Company cannot determine at this time whether a majority of the holders of our
Class B common stock at the time of any future issuance would agree to waive such adjustment to the conversion ratio.
Class B Common Stock — The Company is authorized to issue 10,000,000 shares of Class B common stock with a par value of $0.0001 per share. Holders of Class B common stock are entitled
to one vote for each share. At December 31, 2021 and 2020, there
were 5,177,473 shares of Class B common stock issued and outstanding.
|
WARRANT LIABILITY |
12 Months Ended | ||||||||||||||||||||||||
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Dec. 31, 2021 | |||||||||||||||||||||||||
WARRANT LIABILITY [Abstract] | |||||||||||||||||||||||||
WARRANT LIABILITY |
NOTE 8. WARRANT LIABILITY
At December 31, 2021 and 2020, there were 6,903,297
Public Warrants and 4,094,653 Private Placement Warrants outstanding to purchase an aggregate of 10,997,950 shares of Class A common stock which are contingent upon the occurrence of future events as discussed below. Public Warrants may
only be exercised for a whole number of shares. No fractional warrants will be issued upon separation of the Units and only whole warrants will trade. The Public Warrants will become exercisable on the later of (a) 30 days after the completion of a Business Combination and (b) 12 months from the closing of the Initial Public Offering. The Public Warrants will expire five years after the completion of a Business Combination or earlier upon redemption or liquidation.
The Company will not be obligated to deliver any shares of Class A common stock pursuant to the exercise of a warrant and will have no
obligation to settle such warrant exercise unless a registration statement under the Securities Act covering the issuance of the shares of Class A common stock underlying the warrants is then effective and a prospectus relating thereto is
current, subject to the Company satisfying its obligations with respect to registration. No warrant will be exercisable and the Company will not be obligated to issue shares of Class A common stock upon exercise of a warrant unless Class A
common stock issuable upon such warrant exercise has been registered, qualified or deemed to be exempt under the securities laws of the state of residence of the registered holder of the warrants.
The Company has agreed that as soon as practicable, but in no event later than 15 business days after the closing of a Business Combination, the Company will use its commercially reasonable efforts to file with the SEC a registration statement covering the shares
of Class A common stock issuable upon exercise of the warrants. The Company will use its commercially reasonable efforts to cause such registration statement to become effective within 60 business days after the closing of a Business Combination and to maintain a current prospectus relating to those shares of Class A common stock until the warrants expire or are
redeemed, as specified in the warrant agreement. If a registration statement covering the shares of Class A common stock issuable upon exercise of the warrants is not effective by the 60th business day after the closing of a Business Combination, warrant holders may, until such time as there is an effective registration statement and during any period when the
Company will have failed to maintain an effective registration statement, exercise warrants on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act or another exemption.
Redemptions of warrants when the price per share of Class A common stock
equals or exceeds $18.00 — Once the Public Warrants become exercisable, the
Company may redeem the Public Warrants:
If and when the warrants become redeemable by the Company, the Company may exercise its redemption right even if the Company is unable to
register or qualify the underlying securities for sale under all applicable state securities laws.
Redemption of warrants when the price per share of Class A common stock
equals or exceeds $10.00 — Once the Public Warrants become exercisable, the
Company may redeem the Public Warrants:
If the Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise Public
Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of shares of Class A common stock issuable upon exercise of the warrants may be adjusted in certain circumstances including in the
event of a stock dividend, or recapitalization, reorganization, merger or consolidation. However, except as described below, the warrants will not be adjusted for issuance of Class A common stock at a price below its exercise price.
Additionally, in no event will the Company be required to net cash settle the warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust
Account, holders of warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with the respect to such warrants.
Accordingly, the warrants may expire worthless.
In addition, if (x) the Company issues additional shares of Class A common stock or equity-linked securities for capital raising purposes in
connection with the closing of a Business Combination at an issue price or effective issue price of less than $9.20 per Class A
common (with such issue price or effective issue price to be determined in good faith by the Company’s board of directors and, in the case of any such issuance to the Sponsor or its affiliates, without taking into account any Founder Shares
held by the Sponsor or such affiliates, as applicable, prior to such issuance) (the “Newly Issued Price”), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of a Business Combination on the date of the consummation of a Business Combination (net of
redemptions), and (z) the volume weighted average trading price of the Company’s Class A common stock during the 20 trading day
period starting on the trading day prior to the day on which the Company consummates a Business Combination (such price, the “Market Value”) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $10.00
and $18.00 per share redemption trigger prices will be adjusted (to the nearest cent) to be equal to 100% and 180% of the higher of the
Market Value and the Newly Issued Price, respectively.
The Private Placement Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the
Private Placement Warrants and the Class A common stock issuable upon the exercise of the Private Placement Warrants will not be transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and
be non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers 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.
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INCOME TAX |
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INCOME TAX [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME TAX |
NOTE 9. INCOME TAX
The Company’s net deferred tax assets are as follows:
The income tax provision consists of the following:
As of December 31, 2021 and 2020, the Company had a U.S. federal net operating loss carryover of approximately $200,000 and $40,000 available to
offset future taxable income, respectively.
In assessing the realization of the deferred tax assets, management considers whether it is more likely than not that some portion of all of
the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences representing net future deductible
amounts become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all of the information
available, management believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance. For the year ended December 31, 2021 and for the period
from August 20, 2020 (inception) through December 31, 2020, the change in the valuation allowance was $753,652 and $155,585, respectively.
A reconciliation of the federal income tax rate to the Company’s effective tax rate at December 31, 2021 and 2020 is as follows:
The Company files income tax returns in the U.S. federal jurisdiction in various state and local jurisdictions and is subject to examination
by the various taxing authorities.
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FAIR VALUE MEASUREMENTS |
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FAIR VALUE MEASUREMENTS [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE MEASUREMENTS |
NOTE 10. FAIR VALUE MEASUREMENTS
The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have
received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its
assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price
assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:
The Company classifies its U.S. Treasury and equivalent securities as held-to-maturity in accordance with ASC Topic 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 balance sheets and adjusted for the amortization or accretion of premiums or discounts.
At December 31, 2021, the investments held in the Trust Account were comprised of $207,171,108 in a mutual fund that
invests solely in U.S. Treasury securities. During the year ended December 31, 2021, the Company did not withdraw any interest income from the Trust Account.
At December 31, 2020, the investments held in the Trust Account were comprised of $628 in cash and $207,127,900 in U.S. Treasury securities.
The gross holding gains and fair value of held-to-maturity securities at December 31, 2020 are as follows:
On February 18, 2021, the U.S. Treasury Securities matured and the proceeds from redemption were used to purchase shares of a mutual fund that invests solely in U.S. government securities.
The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at
December 31, 2021 and 2020 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value.
The Warrants were accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities on our balance sheets. The warrant liabilities are measured at fair value at inception and on a recurring basis,
with changes in fair value presented within change in fair value of warrant liabilities in the statements of operations.
The Private Warrants were valued using a Modified Black Scholes Option Pricing Model, which is considered to be a Level 3 fair value measurement. The Modified Black Scholes model’s primary unobservable input utilized in determining the
fair value of the Private Warrants is the expected volatility of the common stock. The expected volatility as of the IPO date was derived from observable public warrant pricing on comparable ‘blank-check’ companies without an identified
target. The expected volatility as of subsequent valuation dates was implied from the Company’s own public warrant pricing. The exchange traded price of the Public Warrants was used as the fair value as of each relevant date.
The following table provides quantitative information regarding Level 3 fair value measurements:
The following table presents the changes in the fair value of the derivative warrant liabilities measured using level 3 inputs:
Transfers to/from Levels 1, 2, and 3 are recognized at the end of the reporting period. There were no transfers between levels for the year ended December 31, 2021.
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SUBSEQUENT EVENTS |
12 Months Ended |
---|---|
Dec. 31, 2021 | |
SUBSEQUENT EVENTS [Abstract] | |
SUBSEQUENT EVENTS |
NOTE 11. SUBSEQUENT EVENTS
The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the financial statement was issued. Based upon this review, the Company did not identify any subsequent events that
would have required adjustment or disclosure in the financial statements.
In February 2022, the Russian Federation and Belarus commenced a military action with the country of Ukraine. As a result of this action, various nations, including the United States, have instituted economic sanctions
against the Russian Federation and Belarus. Further, the impact of this action and related sanctions on the world economy are not determinable as of the date of these financial statements. The specific impact on the Company's financial
condition, results of operations, and cash flows is also not determinable as of the date of these financial statements.
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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) |
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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis of Presentation |
Basis of Presentation
The accompanying financial statements are presented in U.S. dollars and 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 (the “SEC”).
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Use of Estimates |
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires the Company’s 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 financial statements and the reported amounts of expenses during the reporting period.
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a
condition, situation or set of circumstances that existed at the date of the financial statement, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. One of the
more significant accounting estimates included in these financial statements is the determination of the fair value of the warrant liability. Such estimates may be subject to change as more current information becomes available and
accordingly the actual results could differ significantly from those estimates.
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Cash and Cash Equivalents |
Cash and Cash Equivalents
The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The
Company did not have any cash equivalents as of December 31, 2021 and 2020.
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Class A Common Stock Subject to Possible Redemption |
Class A Common Stock Subject to Possible Redemption
The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards
Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common
stock (including common stock that feature redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary
equity. At all other times, common stock is classified as stockholders’ equity. The Company’s Class A common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of
uncertain future events. Accordingly, shares of Class A common stock subject to possible redemption are presented as temporary equity, outside of the stockholders’ equity section of the Company’s balance sheets.
The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of
redeemable common stock to equal the redemption value at the end of each reporting period. Immediately upon the closing of the Initial Public Offering, the Company recognized the accretion from initial book value to redemption amount value.
The change in the carrying value of redeemable Class A common stock resulted in charges against additional paid-in capital and accumulated deficit.
At December 31, 2021 and 2020, the Class A common stock reflected in the balance sheets are reconciled in the following table:
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Offering Costs |
Offering Costs
Offering costs consisted of legal, accounting and other expenses incurred through the Initial Public
Offering that were directly related to the Initial Public Offering. Offering costs were allocated to the separable financial instruments issued in the Initial Public Offering based on a relative fair value basis, compared to total proceeds
received. Offering costs allocated to warrant liabilities were expensed as incurred in the statements of operations. Offering costs associated with the Class A common stock issued were initially charged to temporary equity and then accreted
to common stock subject to redemption upon the completion of the Initial Public Offering (see Note 1).
|
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Warrant Liabilities |
Warrant Liabilities
The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency
risks. The Company evaluates all of its financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480 and
Financial Accounting Standards Board (“FASB”) ASC Topic 815, “Derivatives and Hedging” (“ASC 815”). The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s
specific terms and applicable authoritative guidance in FASB ASC 480, Distinguishing Liabilities from Equity and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial
instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the
Company’s own ordinary shares, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end
date while the warrants are outstanding.
For issued or modified warrants that meet all of the criteria for equity classification, the warrants are
required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their
initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the statements of operations. The fair value of the private
warrants was estimated using a Black-Scholes Model and the public warrants were valued using the exchange traded price as of the valuation date (see Note 10).
|
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Income Taxes |
Income Taxes
The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and
liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in
tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The Company had deferred tax assets
of approximately $909,000 and $156,000
as of December 31, 2021 and 2020, respectively, each of which has a full valuation allowance recorded against them.
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. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2021 and 2020. The Company is currently not aware of any issues under review
that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception.
The provision for income taxes was deemed to be de minimis for the year ended December 31, 2021 and for the period from August 20, 2020
(inception) through December 31, 2020.
|
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Net Income (Loss) per Common Share |
Net Income (Loss) per Common Share
The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share”.
Net income (loss) per common stock is computed by dividing net income (loss) by the weighted average number of common stock outstanding for the period. The Company has two classes of common stock, which are referred to as Class A common
stock and Class B common stock. Income and losses are shared pro rata between the two classes of common stock. Accretion associated with the redeemable shares of Class A common stock is excluded from earnings per share as the redemption
value approximates fair value.
The calculation of diluted net income (loss) per share does not consider the effect of the warrants issued in
connection with the (i)Initial Public Offering, and (ii)the private placement warrants since the exercise of the warrants is contingent upon the occurrence of future events. As of December 31, 2021 and 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. As a result, diluted net income (loss) per common share is the same as basic net
income (loss) per common share for the periods presented.
The following table reflects the calculation of basic and diluted net income (loss) per common stock (in dollars, except per share amounts):
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Concentration of Credit Risk |
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial
institution, which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on this account and management believes the Company is not exposed to significant risks on such account.
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Fair Value of Financial Instruments |
Fair Value of Financial Instruments
The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC 820, “Fair Value Measurement,”
approximates the carrying amounts represented in the accompanying balance sheets, primarily due to their short-term nature.
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Fair Value Measurements |
Fair Value Measurements
Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction
between market participants at the measurement date. U.S. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in
active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include:
In some circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In
those instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement.
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Derivative Financial Instruments |
Derivative Financial Instruments
The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded
derivatives in accordance with ASC Topic 815, “Derivatives and Hedging”. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value on the grant date and is
then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity,
is evaluated at the end of each reporting period. Derivative liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required within 12
months of the balance sheet date.
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Recent Accounting Standards |
Recent Accounting Standards
In August 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20)
and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial
conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces
additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted
method for all convertible instruments. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company is currently assessing
the impact, if any, that ASU 2020-06 would have on its financial position, results of operations or cash flows.
Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material
effect on the Company’s financial statements.
|
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Class A Common Stock Subject to Possible Redemption |
At December 31, 2021 and 2020, the Class A common stock reflected in the balance sheets are reconciled in the following table:
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Basic and Diluted Net Income (Loss) Per Common Share |
The following table reflects the calculation of basic and diluted net income (loss) per common stock (in dollars, except per share amounts):
|
INCOME TAX (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME TAX [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Tax Assets |
The Company’s net deferred tax assets are as follows:
|
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Income Tax Provision |
The income tax provision consists of the following:
|
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Reconciliation of Federal Income Tax Rate |
A reconciliation of the federal income tax rate to the Company’s effective tax rate at December 31, 2021 and 2020 is as follows:
|
FAIR VALUE MEASUREMENTS (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE MEASUREMENTS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Gross Holding Gains and Fair Value of Held-To-Maturity Securities |
The gross holding gains and fair value of held-to-maturity securities at December 31, 2020 are as follows:
|
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Assets and Liabilities Measured at Fair Value on Recurring Basis |
The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at
December 31, 2021 and 2020 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value.
|
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Level 3 Fair Value Measurement Inputs |
The following table provides quantitative information regarding Level 3 fair value measurements:
|
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Changes in Fair Value of Warrant Liabilities |
The following table presents the changes in the fair value of the derivative warrant liabilities measured using level 3 inputs:
|
DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS, Liquidity and Capital Resources (Details) - USD ($) |
Dec. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Going Concern Consideration [Abstract] | ||
Cash in bank | $ 24,970 | $ 1,017,569 |
Investments held in Trust Account | 207,171,108 | $ 207,128,528 |
Working capital | $ 2,794,688 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Cash and Cash Equivalents (Details) - USD ($) |
Dec. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Cash and Cash Equivalents [Abstract] | ||
Cash equivalents | $ 0 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Income Taxes (Details) - USD ($) |
Dec. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Income Taxes [Abstract] | ||
Deferred tax assets | $ 909,237 | $ 155,585 |
Unrecognized tax benefits | 0 | 0 |
Accrued interest and penalties | $ 0 | $ 0 |
INITIAL PUBLIC OFFERING (Details) - $ / shares |
1 Months Ended | ||
---|---|---|---|
Nov. 17, 2020 |
Oct. 23, 2020 |
Nov. 17, 2020 |
|
Initial Public Offering [Member] | Public Shares [Member] | |||
Initial Public Offering [Abstract] | |||
Units issued (in shares) | 20,000,000 | 20,709,894 | |
Unit price (in dollars per share) | $ 10.00 | $ 10.00 | $ 10.00 |
Initial Public Offering [Member] | Public Warrant [Member] | |||
Initial Public Offering [Abstract] | |||
Number of securities called by each unit (in shares) | 0.33 | ||
Warrants exercise price (in dollars per share) | $ 11.50 | ||
Initial Public Offering [Member] | Class A Common Stock [Member] | |||
Initial Public Offering [Abstract] | |||
Number of securities called by each unit (in shares) | 1 | ||
Number of securities called by each warrant (in shares) | 1 | ||
Over-Allotment Option [Member] | Public Shares [Member] | |||
Initial Public Offering [Abstract] | |||
Units issued (in shares) | 709,894 | ||
Unit price (in dollars per share) | $ 10.00 | $ 10.00 |
PRIVATE PLACEMENT (Details) - USD ($) |
4 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Nov. 17, 2020 |
Oct. 23, 2020 |
Dec. 31, 2020 |
Dec. 31, 2021 |
|
Private Placement Warrants [Abstract] | ||||
Gross proceeds from issuance of warrants | $ 6,141,979 | $ 0 | ||
Private Placement Warrants [Member] | ||||
Private Placement Warrants [Abstract] | ||||
Warrants issued (in shares) | 4,000,000 | 4,094,653 | ||
Share price (in dollars per share) | $ 1.50 | |||
Gross proceeds from issuance of warrants | $ 6,000,000 | |||
Private Placement Warrants [Member] | Private Placement [Member] | ||||
Private Placement Warrants [Abstract] | ||||
Warrants issued (in shares) | 94,653 | 4,000,000 | ||
Share price (in dollars per share) | $ 1.50 | $ 1.50 | ||
Gross proceeds from issuance of warrants | $ 141,979 | $ 6,000,000 | ||
Class A Common Stock [Member] | Private Placement Warrants [Member] | Private Placement [Member] | ||||
Private Placement Warrants [Abstract] | ||||
Number of securities called by each warrant (in shares) | 1 | |||
Warrants exercise price (in dollars per share) | $ 11.50 |
RELATED PARTY TRANSACTIONS, Advances from Related Party and Due to Sponsor and Related Party Loans (Details) - Working Capital Loans [Member] - USD ($) |
4 Months Ended | 12 Months Ended | |
---|---|---|---|
Dec. 31, 2020 |
Dec. 31, 2021 |
Dec. 31, 2020 |
|
Sponsor [Member] | |||
Related Party Transactions [Abstract] | |||
Related party transaction | $ 236,779 | $ 170,337 | |
Sponsor or an Affiliate of the Sponsor, or Certain of the Company's Officers and Directors [Member] | |||
Related Party Transactions [Abstract] | |||
Share price (in dollars per share) | $ 1.50 | ||
Convertible loan, outstanding | $ 0 | $ 0 | $ 0 |
Sponsor or an Affiliate of the Sponsor, or Certain of the Company's Officers and Directors [Member] | Maximum [Member] | |||
Related Party Transactions [Abstract] | |||
Related party transaction | $ 2,000,000 |
COMMITMENTS AND CONTINGENCIES, Registration and Stockholder Rights (Details) |
Dec. 31, 2021
Individual
|
---|---|
Maximum [Member] | |
Registration and Stockholder Rights [Abstract] | |
Number of demands eligible security holder can make | 3 |
COMMITMENTS AND CONTINGENCIES, Underwriting Agreement (Details) - USD ($) |
Dec. 31, 2021 |
Oct. 23, 2020 |
---|---|---|
Underwriting Agreement [Abstract] | ||
Underwriters deferred fee (in dollars per unit) | $ 0.35 | |
Deferred underwriting fees | $ 7,248,463 | $ 7,248,463 |
INCOME TAX (Details) - USD ($) |
4 Months Ended | 12 Months Ended |
---|---|---|
Dec. 31, 2020 |
Dec. 31, 2021 |
|
Deferred tax asset (liability) [Abstract] | ||
Net operating loss carryforward | $ 8,486 | $ 41,951 |
Business combination expenses | 0 | 202,141 |
Startup/Organization Expenses | 147,099 | 665,145 |
Total deferred tax assets, net | 155,585 | 909,237 |
Valuation Allowance | (155,585) | (909,237) |
Deferred tax liability, net of valuation allowance | 0 | 0 |
Federal [Abstract] | ||
Current | 0 | 0 |
Deferred | (155,585) | (753,652) |
State and Local [Abstract] | ||
Current | 0 | 0 |
Deferred | 0 | 0 |
Change in valuation allowance | 155,585 | 753,652 |
Income tax provision | 0 | 0 |
Federal net operating loss carryovers | $ 40,000 | $ 200,000 |
Reconciliation of Federal Income Tax Rate [Abstract] | ||
Statutory federal income tax rate | 21.00% | 21.00% |
State taxes, net of federal tax benefit | 0.00% | 0.00% |
Change in fair value of warrants | (19.80%) | (27.30%) |
Change in valuation allowance | (1.20%) | 6.30% |
Income tax provision | 0.00% | 0.00% |
FAIR VALUE MEASUREMENTS, Summary of Assets Held in Trust Account (Details) - USD ($) |
4 Months Ended | |
---|---|---|
Dec. 31, 2020 |
Dec. 31, 2021 |
|
Recurring [Member] | Level 1 [Member] | ||
Assets [Abstract] | ||
Investments held in trust account | $ 0 | $ 207,171,108 |
Cash [Member] | ||
Assets [Abstract] | ||
Investments held in trust account | 628 | |
U.S. Treasury Securities [Member] | ||
Assets [Abstract] | ||
Investments held in trust account | $ 207,127,900 | $ 207,171,108 |
U.S. Treasury Securities [Member] | Recurring [Member] | ||
Held-To-Maturity [Abstract] | ||
Maturity date | Feb. 18, 2021 | |
U.S. Treasury Securities [Member] | Recurring [Member] | Level 1 [Member] | ||
Held-To-Maturity [Abstract] | ||
Amortized cost | $ 207,127,900 | |
Gross holding gain | 5,527 | |
Fair value | $ 207,133,427 |
FAIR VALUE MEASUREMENTS, Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - Recurring [Member] - USD ($) |
Dec. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Level 1 [Member] | ||
Assets [Abstract] | ||
Investments held in Trust Account | $ 207,171,108 | $ 0 |
Level 1 [Member] | Public Warrants [Member] | ||
Liabilities [Abstract] | ||
Warrant Liability | 5,421,160 | 14,704,023 |
Level 3 [Member] | Private Placement Warrants [Member] | ||
Liabilities [Abstract] | ||
Warrant Liability | $ 3,222,938 | $ 9,186,354 |
FAIR VALUE MEASUREMENTS, Level 3 Fair Value Measurement Inputs (Details) |
Dec. 31, 2021
$ / shares
|
Dec. 31, 2020
$ / shares
|
---|---|---|
Fair Value Measurements [Abstract] | ||
Time until Business Combination occurring (years) | 5 years | |
Warrant [Member] | ||
Fair Value Measurements [Abstract] | ||
Time until Business Combination occurring (years) | 1 month 28 days | 7 months 28 days |
Warrant [Member] | Stock Price [Member] | ||
Fair Value Measurements [Abstract] | ||
Measurement input | 9.80 | 10.35 |
Warrant [Member] | Strike Price [Member] | ||
Fair Value Measurements [Abstract] | ||
Measurement input | 11.50 | 11.50 |
Warrant [Member] | Volatility [Member] | ||
Fair Value Measurements [Abstract] | ||
Measurement input | 0.130 | 0.100 |
Warrant [Member] | Risk-free Rate [Member] | ||
Fair Value Measurements [Abstract] | ||
Measurement input | 0.0127 | 0.0046 |
Warrant [Member] | Dividend Yield [Member] | ||
Fair Value Measurements [Abstract] | ||
Measurement input | 0.0000 | 0.000 |
FAIR VALUE MEASUREMENTS, Change in Fair Value of Warrant Liabilities (Details) - USD ($) |
4 Months Ended | 12 Months Ended |
---|---|---|
Dec. 31, 2020 |
Dec. 31, 2021 |
|
Changes in Fair Value of Warrant Liabilities [Roll Forward] | ||
Fair value, Beginning balance | $ 0 | $ 9,186,354 |
Initial measurement on October 23, 2020 (including overallotment) | 12,199,657 | |
Change in valuation inputs or other assumptions | 11,690,720 | (5,963,416) |
Fair value, Ending balance | 9,186,354 | 3,222,938 |
Fair value transfers level 1 to level 2 | 0 | |
Fair value transfers level 2 to level 1 | 0 | |
Fair value transfers into level 3 | 0 | |
Fair value transfers out of level 3 | $ (14,704,023) | $ 0 |
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