This Amendment No. 2 to
the Annual Report on Form 10-K/A (the “Report”) amends Amendment No. 1 to the Annual Report on Form 10-K/A of Omnichannel
Acquisition Corp. for the fiscal period ended December 31, 2020, as filed with the Securities and Exchange Commission (“SEC”)
on June 4, 2021 (the “First Amended Filing”).
In preparation of the
Company’s financial statements as of and for the quarterly period ended September 30, 2021, the Company concluded it should revise
its previously filed financial statements to classify all Class A common stock subject to possible redemption in temporary equity. In
accordance with the SEC and its staff’s guidance on redeemable equity instruments in ASC 480-10-S99, redemption provisions not
solely within the control of the Company require common stock subject to redemption to be classified outside of permanent equity. The
Company had previously classified a portion of its Class A common stock in permanent equity, or total stockholders’ equity (deficit).
Although the Company did not specify a maximum redemption threshold, its charter currently provides that the Company will not redeem
its public shares in an amount that would cause its net tangible assets to be less than $5,000,001. Previously, the Company did not consider
redeemable shares classified as temporary equity as part of net tangible assets. Effective with its financial statements for quarterly
period ended September 30, 2021, the Company revised this interpretation to include temporary equity in net tangible assets. In addition,
in connection with the change in presentation for the Class A common stock subject to possible redemption, the Company determined it
should restate its earnings per share calculation to allocate income and losses shared pro rata between the two classes of shares. This
presentation contemplates a Business Combination as the most likely outcome, in which case, both classes of shares share pro rata in
the income and losses of the Company.
After further consideration
of the impact of the error that led to the revised September 30, 2021 financial statements, on November 23, 2021, the Company’s
management and the audit committee of the Company’s board of directors (the “Audit Committee”) concluded that the Company’s
previously issued (i) audited balance sheet as of November 24, 2020 (the “Post IPO Balance Sheet”), as previously revised
in the Company’s Annual Report on Form 10-K, as amended, for the fiscal year ended December 31, 2020, filed with the SEC on June
4, 2021 (“2020 Form 10-K/A No. 1”), (ii) audited financial statements included in the 2020 Form 10-K/A No. 1, (iii) unaudited
interim financial statements included in the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2021,
filed with the SEC on June 8, 2021; and (iv) unaudited interim financial statements included in the Company’s Quarterly Report
on Form 10-Q for the quarterly period ended June 30, 2021, filed with the SEC on August 13, 2021 (collectively, the “Affected Periods”),
should be restated to report all Public Shares as temporary equity and should no longer be relied upon. As such, the Company will restate
its financial statements for the Affected Periods in this Form 10-K/A for the Post IPO Balance Sheet and the Company’s audited
financial statements included in the 2020 Form 10-K/A No. 1. The unaudited condensed financial statements for the periods ended March
31, 2021 and June 30, 2021 will be amended in the Company’s Quarterly Report on Form 10-Q/A for the quarterly period ended September
30, 2021, to be filed with the SEC (the “Q3 Form 10-Q”).
The restatement does
not have an impact on the Company’s cash position and cash held in the trust account established in connection with the IPO (the
“Trust Account”).
The Company’s management has concluded
that a material weakness remains in the Company’s internal control over financial reporting and that the Company’s disclosure
controls and procedures were not effective. The Company’s remediation plan with respect to such material weakness will be described
in more detail in Item 4 of Part 1 to the Q3 Form 10-Q.
PART
II
ITEM
7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
References to the “Company,”
“Omnichannel Acquisition Corp.,” “Omnichannel,” “our,” “us” or “we” refer
to Omnichannel Acquisition Corp. The following discussion and analysis of the Company’s financial condition and results of operations
should be read in conjunction with the audited condensed consolidated financial statements and the notes thereto contained elsewhere
in this report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that
involve risks and uncertainties.
Cautionary Note Regarding Forward-Looking
Statements
This Annual Report on Form 10-K includes
forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange
Act. We have based these forward-looking statements on our current expectations and projections about future events. These forward-looking
statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of
activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements
expressed or implied by such forward-looking statements. In some cases, you can identify forward-looking statements by terminology such
as “may,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,”
“believe,” “estimate,” “continue,” or the negative of such terms or other similar expressions. Factors
that might cause or contribute to such a discrepancy include, but are not limited to, those described in our other SEC filings.
In this Report, we are restating our audited
financial statements as of December 31, 2020, our audited financial statements for the period from September 9, 2020 (inception)
through December 31, 2020 and the audited balance sheet issued in connection with our initial public offering on November 24, 2021.
In
preparation of our financial statements as of and for quarterly period ended September 30, 2021, we concluded we should revise our previously
filed financial statements to classify all Class A common stock subject to possible redemption in temporary equity. In accordance with
the SEC and its staff’s guidance on redeemable equity instruments in ASC 480-10-S99, redemption provisions not solely within our
control require common stock subject to redemption to be classified outside of permanent equity. We had previously classified a portion
of its Class A common stock in permanent equity, or total stockholders’ equity. Although we did not specify a maximum redemption
threshold, our charter currently provides that we will not redeem our public shares in an amount that would cause our net tangible assets
to be less than $5,000,001. Previously, we did not consider redeemable shares classified as temporary equity as part of net tangible
assets. Effective with its financial statements for quarterly period ended September 30, 2021, we revised this interpretation to include
temporary equity in net tangible assets. In addition, in connection with the change in presentation for the Class A common stock subject
to possible redemption, we determined we should restate our earnings per share calculation to allocate income and losses shared pro rata
between the two classes of shares. This presentation contemplates a Business Combination as the most likely outcome, in which case, both
classes of shares share pro rata in our income and losses.
After further consideration
of the impact of the error that led to the revised September 30, 2021 financial statements, on November 23, 2021, the management and
the audit committee of our board of directors (the “Audit Committee”) concluded that our previously issued (i) audited balance
sheet as of November 24, 2020 (the “Post IPO Balance Sheet”), as previously revised in our Annual Report on Form 10-K, as
amended, for the fiscal year ended December 31, 2020, filed with the SEC on June 4, 2021 (“2020 Form 10-K/A No. 1”), (ii)
audited financial statements included in the 2020 Form 10-K/A No. 1, (iii) unaudited interim financial statements included in the Company’s
Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2021, filed with the SEC on June 8, 2021; and (iv) unaudited interim
financial statements included our Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2021, filed with the SEC on August
13, 2021 (collectively, the “Affected Periods”), should be restated to report all Public Shares as temporary equity and should
no longer be relied upon. As such, we will restate our financial statements for the Affected Periods in this Form 10-K/A for the Post
IPO Balance Sheet and our audited financial statements included in the 2020 Form 10-K/A No. 1. The unaudited condensed financial statements
for the periods ended March 31, 2021 and June 30, 2021 will be amended in our Quarterly Report on Form 10-Q/A for the quarterly period
ended September 30, 2021, to be filed with the SEC (the “Q3 Form 10-Q”).
The restatement
does not have an impact on our cash position and cash held in the trust account established in connection
with the IPO (the “Trust Account”).
In connection with the
restatement, our management reassessed the effectiveness of our disclosure controls and procedures for the periods affected by the restatement.
As a result of that reassessment, we determined that our disclosure controls and procedures for such periods were not effective with
respect to the classification of the Company’s warrants as components of equity instead of as derivative liabilities. For more
information, see “Part II, Item 9A. Controls and Procedures” included in this Report.
We have not amended our
previously filed Quarterly Report on Form 10-Q for the period affected by the restatement. The financial information that has been previously
filed or otherwise reported for these periods is superseded by the information in this Report, and the financial statements and related
financial information contained in such previously filed reports should no longer be relied upon.
The restatement is more fully
described in Note 2 of the notes to the financial statements included herein.
Overview
We
are a blank check company incorporated in Delaware on September 9, 2020 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”).
Our sponsor is Omnichannel Sponsor LLC, a Delaware limited liability company (“Sponsor”).
The
registration statement for our initial public offering (“Initial Public Offering”) became effective on November 19, 2020.
On November 24, 2020, we consummated the Initial Public Offering of 20,000,000 units (the “Units”) at $10.00 per Unit, generating
gross proceeds of $200.0 million, and incurring offering costs of approximately $11.6 million, inclusive of $7.0 million
in deferred underwriting commissions. We granted the underwriters in the Initial Public Offering a 45-day option to purchase up to 3,000,000
additional units to cover over-allotments, if any. The underwriters partially exercised the over-allotment option and on November 30,
2020, the underwriters purchased an additional 650,000 Units (the “Over-Allotment Units”), generating gross proceeds of $6.5
million, and incurred additional offering costs of $357,500 in underwriting fees (inclusive of $227,500 in deferred underwriting fees)
(the “Over-Allotment”).
Simultaneously
with the closing of the Initial Public Offering, we consummated the private placement (“Private Placement”) of 6,000,000
warrants (each, a “Private Placement Warrant” and collectively, the “Private Placement Warrants”) at a price
of $1.00 per Private Placement Warrant to our Sponsor, generating proceeds of $6.0 million. Simultaneously with the closing
of the Over-Allotment on November 30, 2020, we consummated the second closing of the Private Placement, resulting in the purchase of
an aggregate of an additional 130,000 Private Placement Warrants by our Sponsor, generating gross proceeds to the Company
of $130,000.
Upon
the closing of the Initial Public Offering, the Over-Allotment and the Private Placement, $206.5 million ($10.00 per Unit) of the net
proceeds of the sale of the Units in the Initial Public Offering, the Over-Allotment and of the Private Placement Warrants in the Private
Placement were placed in a trust account (“Trust Account”), located in the United States with Continental Stock Transfer &
Trust Company acting as trustee, and invested only in U.S. government treasury bills with a maturity of 185 days or less or in money
market funds investing solely in U.S. Treasuries and meeting certain conditions under Rule 2a-7 under the Investment Company
Act of 1940, as amended (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 Trust Account as described below.
If
we are unable to complete a Business Combination within 18 months from the closing of the Initial Public Offering, or May 24, 2022, (the
“Combination Period”) and our stockholders have not amended the Certificate of Incorporation to extend such Combination Period,
we will (1) cease all operations except for the purpose of winding up; (2) as promptly as reasonably possible but not more than 10 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 (less up to $100,000 of interest to pay dissolution expenses and which interest shall be net of taxes
payable), divided by the number of then issued and outstanding Public Shares, which redemption will completely extinguish Public Stockholders’
rights as stockholders (including the right to receive further liquidating distributions, if any); and (3) as promptly as reasonably
possible following such redemption, subject to the approval of the remaining stockholders and our board of directors, liquidate and dissolve,
subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable
law.
Liquidity
and Capital Resources
As
of December 31, 2020, we had approximately $821,000 in cash and working capital of approximately $1.2 million (excluding tax obligations
of approximately $61,000 that may be paid using investment income earned from the Trust Account).
Our
liquidity needs to date have been satisfied through the $25,000 capital contribution to purchase founder shares by our Sponsor, the loan
proceeds under a promissory note of $105,000 from our Sponsor to cover the Company’s offering costs in connection with the Initial
Public Offering, and the net proceeds from the consummation of the Private Placement not held in the Trust Account. The balance of the
promissory note was fully repaid on November 24, 2020. In addition, in order to finance transaction costs in connection with a Business
Combination, our Sponsor or an affiliate of our Sponsor, or certain of our officers and directors may, but are not obligated to, provide
us Working Capital Loans. As of December 31, 2020, there were no amounts outstanding under any Working Capital Loans.
Based
on the foregoing, management believes that we will have sufficient working capital and borrowing capacity from our Sponsor or an affiliate
of our Sponsor, or certain of our officers and directors to meet its needs through the earlier of the consummation of a Business Combination
or one year from this filing. Over this time period, we will be using these funds for paying existing accounts payable, identifying and
evaluating prospective initial Business Combination candidates, performing due diligence on prospective target businesses, paying for
travel expenditures, selecting the target business to merge with or acquire, and structuring, negotiating and consummating the Business
Combination.
Management
continues to evaluate the impact of the COVID-19 pandemic and has concluded that the specific impact is not readily determinable as of
the date of the balance sheet. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Results
of Operations
Our
entire activity since inception through December 31, 2020 related to our formation, the preparation for the Initial Public Offering, and
since the closing of the Initial Public Offering, the search for a prospective initial Business Combination. We have neither
engaged in any operations nor generated any revenues to date. We will not generate any operating revenues until after completion of our
initial Business Combination. We will generate non-operating income in the form of interest earned on investments held in Trust Account. We
expect to incur increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance),
as well as for due diligence expenses.
For
the period from September 9, 2020 (inception) through December 31, 2020, we had a net loss of approximately $3.9 million, which consisted
of approximately $1.8 million loss from changes in fair value of derivative warrant liabilities, a loss upon issuance of Private Placement
Warrants of approximately $1.1 million, offering costs of approximately $0.7 million related to the issuance of derivative warrant liabilities,
approximately $173,000 in general and administrative expenses, $8,000 in general and administrative expenses to related parties, $62,000
of franchise tax expense, and a net loss on investments held in the Trust Account of approximately $1,000.
As
a result of the restatement described in Note 2 of the notes to the financial statements included herein, we classify the Warrants issued
in connection with our Initial Public Offering and Private Placement as liabilities at their fair value and adjust the warrant instruments
to fair value at each reporting period. These liabilities are subject to re-measurement at each balance sheet date until exercised, and
any change in fair value is recognized in our statement of operations. For the periods from September 9, 2020 (inception) through December
31, 2020, the change in fair value of warrants was an increase of $1.8 million.
Related
Party Transactions
Founder
Shares
On
September 30, 2020, our Sponsor purchased 10,062,500 shares of the Company’s Class B common stock, par value $0.0001
per share (the “Founder Shares”), for an aggregate price of $25,000. On November 13, 2020 and November 19, 2020,
respectively, our Sponsor surrendered 2,875,000 and 1,437,500 shares of Class B common stock to the Company for cancellation for
no consideration, resulting in an aggregate of 5,750,000 shares of Class B common stock outstanding. Our initial stockholders agreed
to forfeit up to 750,000 Founder Shares to the extent that the over-allotment option is not exercised in full by the underwriters,
so that the Founder Shares will represent 20.0% of the Company’s issued and outstanding shares after the Initial Public Offering.
On November 30, 2020, the underwriters partially exercised the over-allotment option to purchase an additional 650,000 Units; thus, only
587,500 shares of Class B common stock remain subject to forfeiture. The remaining unexercised over-allotment option expired on January
8, 2021; thus, 587,500 shares of Class B common stock held by the Sponsor were forfeited.
Our
initial stockholders 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 the initial Business Combination or earlier if, subsequent to the initial Business
Combination, the closing 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 the initial Business Combination, and (B) the date following the completion of the initial
Business Combination on which we complete a liquidation, merger, capital stock exchange or other similar transaction that results in
all of our stockholders having the right to exchange their Class A common stock for cash, securities or other property. Any permitted
transferees will be subject to the same restrictions and other agreements of the initial stockholders with respect to any Founder Shares.
Private
Placement Warrants
Simultaneously
with the closing of the Initial Public Offering, we consummated the Private Placement of 6,000,000 Private Placement Warrants at a price
of $1.00 per Private Placement Warrant to our sponsor, generating gross proceeds of $6.0 million. Simultaneously with the closing
of the Over-Allotment on November 30, 2020, we consummated the second closing of the Private Placement, resulting in the purchase of
an aggregate of an additional 130,000 Private Placement Warrants by our Sponsor, generating gross proceeds to the Company
of $130,000.
Each
Private Placement Warrant is exercisable for one whole share of Class A common stock at a price of $11.50 per share. A portion
of the proceeds from the sale of the Private Placement Warrants to our Sponsor was added to the proceeds from the Initial Public Offering
held in the Trust Account. If we do not complete a Business Combination within the Combination Period, the Private Placement Warrants
will expire worthless. The Private Placement Warrants will be non-redeemable for cash and exercisable on a cashless basis
so long as they are held by our Sponsor or its permitted transferees. The Private Placement Warrants (including the Class A common
stock issuable upon exercise of the Private Placement Warrants) are transferable, assignable or salable until 30 days after the
completion of the initial Business Combination.
Our
Sponsor and our officers and directors agreed, subject to limited exceptions, not to transfer, assign or sell any of their Private Placement
Warrants until 30 days after the completion of the initial Business Combination.
Related
Party Loans
On
September 9, 2020, our Sponsor agreed to loan us an aggregate of up to $300,000 to cover expenses related to the Initial Public Offering
pursuant to a promissory note (the “Note”). This loan was non-interest bearing and payable upon the completion
of the Initial Public Offering. We borrowed approximately $105,000 under the Note and fully repaid the Note in full on November
24, 2020.
In
addition, in order to finance transaction costs in connection with a Business Combination, our Sponsor or an affiliate of our Sponsor,
or certain of our officers and directors may, but are not obligated to, loan us funds as may be required (“Working Capital Loans”).
If we complete a Business Combination, we will 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, we 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. The Working Capital Loans would either be repaid
upon consummation of a Business Combination or, at the lender’s discretion, up to $1.5 million of such Working Capital Loans may
be convertible into warrants of the post Business Combination entity at a price of $1.00 per warrant. The warrants would be identical
to the Private Placement Warrants. 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. To date, we have borrowings under the Working Capital Loans.
Administrative
Services Agreement
Commencing
on the date that the Company’s securities were first listed on the New York Stock Exchange until the earlier of the
Company’s consummation of a Business Combination or the Company’s liquidation, we agreed to pay our Sponsor a total of
$4,000 per month for office space, secretarial and administrative services provided to members of our management team.
Our
Sponsor, officers and directors, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in
connection with activities on the Company’s behalf such as identifying potential target businesses and performing due diligence
on suitable Business Combinations. Our audit committee will review on a quarterly basis all payments that were made by us to our Sponsor,
directors, officers or the Company’s or any of their affiliates.
Contractual
Obligations
Registration
Rights
The
initial stockholders and holders of the Private Placement Warrants are entitled to registration rights pursuant to a registration rights
agreement. The initial stockholders and holders of the Private Placement Warrants will be entitled to make up to three demands, excluding
short form registration demands, that we register such securities for sale under the Securities Act. In addition, these holders will
have “piggy-back” registration rights to include their securities in other registration statements filed by us. We will bear
the expenses incurred in connection with the filing of any such registration statements.
Underwriting
Agreement
The
underwriters were entitled to an underwriting discount of $0.20 per Unit, or $4.0 million in the aggregate, paid upon the closing
of the Initial Public Offering. In addition, the underwriters are entitled to a deferred fee of $0.35 per Unit, or $7.0 million
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.
Critical
Accounting Policies and Estimates
Investments
Held in the Trust Account
Our
portfolio of investments held in the Trust Account is comprised of U.S. government securities, within the meaning set forth in Section
2(a)(16) of the Investment Company Act, with a maturity of 185 days or less, or investments in money market funds that invest in U.S.
government securities, or a combination thereof. Our investments held in the Trust Account are classified as trading securities. Trading
securities are presented on the balance sheet at fair value at the end of each reporting period. Gains and losses resulting from the
change in fair value of these investments are included in interest earned from investments held in Trust Account in the statement of
operations. The estimated fair values of investments held in the Trust Account are determined using available market information, other
than for investments in open-ended money market funds with published daily net asset values (“NAV”), in which case the Company
uses NAV as a practical expedient to fair value. The NAV on these investments is typically held constant at $1.00 per unit.
Class A
Common Stock Subject to Possible Redemption
We account for our Class A
common stock subject to possible redemption in accordance with the guidance in ASC Topic 480 “Distinguishing Liabilities from Equity”
(“ASC 480”). Shares of Class A common stock subject to mandatory redemption (if any) are classified as liability instruments
and are measured at fair value. Shares of conditionally redeemable Class A common stock (including Class A common stock that
feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain
events not solely within our control) are classified as temporary equity. At all other times, shares of Class A common stock are
classified as stockholders’ equity. Our Class A common stock features certain redemption rights that are considered to be
outside of our control and subject to the occurrence of uncertain future events. Accordingly, as of December 31, 2020, a total of 20,650,000
shares of Class A common stock subject to possible redemption are presented as temporary equity, outside of the stockholders’
equity section of our balance sheet.
Immediately upon the closing of the Initial
Public Offering, we recognized the accretion from initial book value to redemption amount. The change in the carrying value of redeemable
shares of Class A common stock resulted in charges against additional paid-in capital and accumulated deficit.
Net
Loss Per Common Share
We have two classes
of shares: Class A common stock and Class B common stock.
Income and losses are shared pro rata between the two classes of shares. Net income (loss) per common stock is
computed by dividing net income (loss) by the weighted-average number of common stock outstanding
during the periods. We do not consider the effect warrants sold in the Initial Public Offering and
the Private Placement, an aggregate of 16,455,000 warrants,
would have on diluted net income (loss) per share if exercised to purchase the Company’s Class A
common stock because their exercise is contingent upon future events and their inclusion would be anti-dilutive
under the treasury stock method. As a result, diluted net income (loss) per share is the same as basic net income (loss) per share for
the period from September 9, 2020 (inception) through December 31, 2020. Accretion associated with
the Class A common stock subject to possible redemption is excluded from earnings per share
as the redemption value approximates fair value.
Derivative
Warrant Liabilities
We
do not use derivative instruments to hedge exposures to cash flow, market or foreign currency risks. We evaluate all of our 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 ASC 815-40. The classification of derivative instruments, including whether such instruments
should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Derivative warrant liabilities are
classified as non-current liabilities as their liquidation is not reasonably expected to require the use of current assets or require
the creation of current liabilities.
We
issued 10,325,000 warrants to purchase Class A common stock, including Over-Allotment Units, to investors in our Initial Public Offering
and issued 6,130,000 Private Placement Warrants. All of our outstanding warrants are recognized as derivative liabilities in accordance
with ASC 815-40. Accordingly, we recognize the warrant instruments as liabilities at fair value and adjust the instruments to fair value
at each reporting period. The liabilities are subject to re-measurement at each balance sheet date until exercised, and any change in
fair value is recognized in our statement of operations. The fair value of Public Warrants, was calculated using a binomial / lattice
model that assumes optimal exercise of the Company’s redemption option, including the make whole table, at the earliest possible
date. Subsequent to the when the warrants began separately trading, the fair value measurements were determined based on their trading
price. The fair value of Public Warrants and Private Warrants was estimated at each measurement date using a binomial / lattice model
that assumes optimal exercise of the Company’s redemption option, including the make whole table, at the earliest possible date.
Off-Balance Sheet Arrangements and Contractual Obligations
As
of December 31, 2020, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii)
of Regulation S-K and did not have any commitments or contractual obligations.
JOBS
Act
The
Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”) contains provisions that, among other things, relax certain
reporting requirements for qualifying public companies. We qualify as an “emerging growth company” and under the JOBS Act
are allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies.
We are electing to delay the adoption of new or revised accounting standards, and as a result, we may not comply with new or revised
accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As a result,
the financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company
effective dates.
Additionally,
we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject
to certain conditions set forth in the JOBS Act, if, as an “emerging growth company,” we choose to rely on such exemptions
we may not be required to, among other things, (i) provide an auditor’s attestation report on our system of internal controls over
financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may be required of non-emerging growth
public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted
by the PCAOB regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about
the audit and the financial statements (auditor discussion and analysis) and (iv) disclose certain executive compensation related items
such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee
compensation. These exemptions will apply for a period of five years following the completion of our Initial Public Offering or until
we are no longer an “emerging growth company,” whichever is earlier.
Recent
Accounting Pronouncements
Our
management does not believe there are any other recently issued, but not yet effective, accounting pronouncements, if currently adopted,
that would have a material effect on our financial statements.
ITEM 8.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
This
information appears following Item 15 of this Annual Report on Form 10-K and is incorporated herein by reference.
ITEM
9A. CONTROLS AND PROCEDURES.
Evaluation of Disclosure Controls and Procedures
Under the supervision
and with the participation of our management, including our principal executive officer and principal financial officer, we conducted
an evaluation of the effectiveness of our disclosure controls and procedures as of the end of the period ended December 31, 2020, as
such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on this evaluation, our principal executive officer
and principal financial officer has concluded that, as of the evaluation date, our disclosure controls and procedures were not effective
as of December 31, 2020, because of a material weakness in our internal control over financial reporting. A material weakness is a deficiency,
or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material
misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. Specifically,
the Company’s management has concluded that our control around the interpretation and accounting for certain complex equity and
equity-linked instruments issued by the Company and the presentation of earnings per share was not effectively designed or maintained.
This material weakness resulted in the restatement of the Company’s balance sheet as of November 24, 2020 and its annual financial
statements for the period ended December 31, 2020. Additionally, this material weakness could result in a misstatement of the warrant
liability, Class A common stock and related accounts and disclosures that would result in a material misstatement of the financial statements
that would not be prevented or detected on a timely basis.
Disclosure controls and
procedures are designed to ensure that information required to be disclosed by us in our Exchange Act reports is recorded, processed,
summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated
and communicated to our management, including our principal executive officer and principal financial officer or persons performing similar
functions, as appropriate, to allow timely decisions regarding required disclosure.
Changes in
Internal Control over Financial Reporting
There was no change in
our internal control over financial reporting that occurred during the period ended December 31, 2020 covered by this Report that has
materially affected, or is reasonably likely to materially affect, our internal control over financial reporting except for the below:
Our principal executive
officer and principal financial officer performed additional accounting and financial analyses and other post-closing procedures including
consulting with subject matter experts related to the accounting for certain complex equity and equity-linked instruments issued by the
Company and the presentation of earnings per share. The Company’s management has expended, and will continue to expend, a substantial
amount of effort and resources for the remediation and improvement of our internal control over financial reporting. While we have processes
to properly identify and evaluate the appropriate accounting technical pronouncements and other literature for all significant or unusual
transactions, we have expanded and will continue to improve these processes to ensure that the nuances of such transactions are effectively
evaluated in the context of the increasingly complex accounting standards.
NOTES TO FINANCIAL STATEMENTS
As Restated
Note
1—Description of Organization and Business Operations
Omnichannel
Acquisition Corp. (the “Company”) is a blank check company incorporated in Delaware on September 9, 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 an emerging growth company and, as such,
the Company is subject to all of the risks associated with emerging growth companies.
As
of December 31, 2020, the Company had not commenced any operations. All activity for the period from September 9, 2020 (inception) through
December 31, 2020 relates to the Company’s formation and the initial public offering (the “Initial Public Offering”),
described below, and since the closing of the Initial Public Offering, the search for a prospective initial 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 on investments from the proceeds derived from the Initial Public
Offering (as defined below). The Company has selected December 31 as its fiscal year end.
The
Company’s sponsor is Omnichannel Sponsor LLC, a Delaware limited liability company (the “Sponsor”). The registration
statement for the Company’s Initial Public Offering was declared effective November 19, 2020. On November 24, 2020, the Company
consummated its Initial Public Offering of 20,000,000 units (the “Units”) at $10.00 per Unit, generating gross proceeds
of $200.0 million, and incurring offering costs of approximately $11.6 million, inclusive of $7.0 million in deferred
underwriting commissions (Note 6). The Company granted the underwriters in the Initial Public Offering (the “Underwriters”)
a 45-day option to purchase up to 3,000,000 additional units to cover over-allotments, if any. The Underwriters partially exercised the
over-allotment option and on November 30, 2020, the underwriters purchased an additional 650,000 Units (the “Over-Allotment Units”),
generating gross proceeds of $6.5 million, and incurred additional offering costs of $357,500 in underwriting fees (inclusive of $227,500
in deferred underwriting fees) (the “Over-Allotment”).
Simultaneously
with the closing of the Initial Public Offering, the Company consummated the private placement (“Private Placement”) of 6,000,000
warrants (each, a “Private Placement Warrant” and collectively, the “Private Placement Warrants”) at a price
of $1.00 per Private Placement Warrant to the Sponsor, generating proceeds of $6.0 million (Note 5). Simultaneously with the
closing of the Over-Allotment on November 30, 2020, the Company consummated the second closing of the Private Placement, resulting in
the purchase of an aggregate of an additional 130,000 Private Placement Warrants by the Sponsor, generating gross proceeds
to the Company of $130,000.
Upon
the closing of the Initial Public Offering, the Over-Allotment and the Private Placement, $206.5 million ($10.00 per Unit) of the net
proceeds of the sale of the Units in the Initial Public Offering, the Over-Allotment and of the Private Placement Warrants in the Private
Placement were placed in a trust account (“Trust Account”), located in the United States with Continental Stock Transfer &
Trust Company acting as trustee, and invested only in U.S. government treasury bills with a maturity of 185 days or less or in money
market funds investing solely in U.S. Treasuries and meeting certain conditions under Rule 2a-7 under the Investment Company
Act of 1940, as amended (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 Trust Account as described below.
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 the 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 having an aggregate fair market value of at least 80% of the net
assets held in the Trust Account net of amounts disbursed to management for working capital purposes, if permitted, and excluding the
amount of any deferred underwriting commissions) at the time of the agreement to enter into the initial Business Combination. However,
the Company will only complete a Business Combination if the post-business combination company owns or acquires 50% or more of the
voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register
as an investment company under the Investment Company Act.
The
Company provides the holders of the Company’s outstanding shares of Class A common stock (the “Public Stockholders”),
par value $0.0001 per share, sold in the Initial Public Offering (the “Public Shares”) 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, solely in its discretion. The Public
Stockholders will be entitled to redeem their Public Shares for a pro rata portion of the amount then held in the Trust Account (initially
anticipated to be $10.00 per Public Share). The per-share amount to be distributed to Public Stockholders who redeem their Public
Shares will not be reduced by the deferred underwriting commissions the Company will pay to the underwriters (as discussed in Note 6).
These Public Shares are recorded at a redemption value and classified as temporary equity upon the completion of the Initial Public Offering
in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”)
Topic 480 “Distinguishing Liabilities from Equity” (“ASC 480”). The Company will proceed with a Business Combination
if a majority of the shares voted are voted in favor of the Business Combination. The Company will not redeem the Public Shares in an
amount that would cause its net tangible assets to be less than $5,000,001. If a stockholder vote is not required by law 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 “Amended and Restated 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 law, or the Company decides to
obtain stockholder approval for business or legal 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. Additionally, each Public Stockholder may elect to redeem their
Public Shares irrespective of whether they vote for or against the proposed transaction. If the Company seeks stockholder approval in
connection with a Business Combination, the Initial Stockholders (as defined below) agreed to vote their Founder Shares (as defined below
in Note 45) and any Public Shares purchased during or after the Initial Public Offering in favor of a Business Combination. In addition,
the Initial Stockholders agreed to waive their redemption rights with respect to their Founder Shares and Public Shares in connection
with the completion of a Business Combination.
The
Amended and Restated Certificate of Incorporation provides 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% or more of the Public Shares, without the prior consent of the Company.
The
Sponsor and the Company’s officers and directors (the “Initial Stockholders”) agreed not to propose an amendment to
the Amended and Restated Certificate of Incorporation to modify the substance or timing of the Company’s obligation to redeem 100%
of the Public Shares if the Company does not complete a Business Combination within the Combination Period (as defined below) or with
respect to any other material provisions relating to stockholders’ rights or pre-initial Business Combination activity, unless
the Company provides the Public Stockholders with the opportunity to redeem their Public Shares in conjunction with any such amendment.
If
the Company is unable to complete a Business Combination within 18 months from the closing of the Initial Public Offering, or May
24, 2022 (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 ten 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 the Company to pay its 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 remaining stockholders and the board of directors, liquidate and dissolve,
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.
The
Initial Stockholders agreed to waive their rights to liquidating distributions from the Trust Account with respect to the Founder Shares
if the Company fails to complete a Business Combination within the Combination Period. However, if the Initial Stockholders acquire Public
Shares in or after the Initial Public Offering, they will be entitled to liquidating distributions from the Trust Account with respect
to such Public Shares if the Company fails to complete a Business Combination within the Combination Period. The underwriters agreed
to waive their rights to the 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 residual assets remaining available for distribution (including Trust Account assets) will be
only $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 (except for the Company’s independent registered public accounting firm) for services rendered
or products sold to the Company, or a prospective target business with which the Company has entered into a letter of intent, confidentiality
or other similar agreement or business combination agreement (a “Target”), 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 Target that executed a waiver of any
and all rights to the monies held in the Trust Account (whether or not such waiver is enforceable) not 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”). 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, prospective
target businesses or 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.
Liquidity
and Capital Resources
As
of December 31, 2020, the Company had approximately $821,000 in cash, and working capital of approximately $1.2 million (excluding
tax obligations of approximately $61,000 that may be paid using investment income earned from the Trust Account).
The
Company’s liquidity needs had been satisfied through a capital contribution of $25,000 from the Sponsor to purchase the Founder
Shares (as defined below), the loan under the Note from the Sponsor of approximately $105,000 (see Note 5) to the Company, and the net
proceeds from the consummation of the Private Placement not held in the Trust Account. The Company fully repaid the Note on November
24, 2020. In addition, 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, provide the Company Working Capital
Loans (see Note 5). As of December 31, 2020, there were no amounts outstanding under any Working Capital Loans.
In
connection with the Company’s assessment of going concern considerations in accordance with FASB ASC Topic 205-40, “Presentation
of Financial Statements - Going Concern,” management has determined that the mandatory liquidation date and subsequent dissolution
raises substantial doubt about the Company’s ability to continue as a going concern. If the Company is unable to complete a business
combination by May 24, 2022 then the Company will cease all operations except for the purpose of liquidating. No adjustments have been
made to the carrying amounts of assets or liabilities should the Company be required to liquidate after May 24, 2022.
Risks
and Uncertainties
On
January 30, 2020, the World Health Organization (“WHO”) announced a global health emergency because of a new strain of coronavirus
(the “COVID-19 outbreak”). In March 2020, the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase
in exposure globally. The full impact of the COVID-19 outbreak continues to evolve. The impact of the COVID-19 outbreak on the Company’s
results of operations, financial position and cash flows will depend on future developments, including the duration and spread of the
outbreak and related advisories and restrictions. These developments and the impact of the COVID-19 outbreak on the financial markets
and the overall economy are highly uncertain and cannot be predicted. If the financial markets and/or the overall economy are impacted
for an extended period, the Company’s results of operations, financial position and cash flows may be materially adversely affected.
Additionally, the Company’s ability to complete an Initial Business Combination may be materially adversely affected due to significant
governmental measures being implemented to contain the COVID-19 outbreak or treat its impact, including travel restrictions, the shutdown
of businesses and quarantines, among others, which may limit the Company’s ability to have meetings with potential investors or
affect the ability of a potential target company’s personnel, vendors and service providers to negotiate and consummate an Initial
Business Combination in a timely manner. The Company’s ability to consummate an Initial Business Combination may also be dependent
on the ability to raise additional equity and debt financing, which may be impacted by the COVID-19 outbreak and the resulting market
downturn.
Note 2—Restatement
of Previously Issued Financial Statements
In connection with the change in presentation
of Class A common stock subject to possible redemption, the Company concluded it should restate its previously filed financial statements
to classify all Class A common stock subject to possible redemption in temporary equity. In accordance with the SEC and its staff’s
guidance on redeemable equity instruments in ASC 480-10-S99, redemption provisions not solely within the control of the Company require
common stock subject to redemption to be classified outside of permanent equity. The Company had previously classified a portion of its
Class A common stock in permanent equity, or total stockholders’ equity. Although the Company did not specify a maximum redemption
threshold, its charter currently provides that, the Company will not redeem its public shares in an amount that would cause its net tangible
assets to be less than $5,000,001. Previously, the Company did not consider redeemable shares classified as temporary equity as part
of net tangible assets. Effective with its financial statements for quarterly period ended September 30, 2021, the Company revised this
interpretation to include temporary equity in net tangible assets. In addition, in connection with the change in presentation for the
Class A common stock subject to possible redemption, the Company determined it should restate its earnings per share calculation to allocate
income and losses shared pro rata between the two classes of shares. This presentation contemplates a Business Combination as the most
likely outcome, in which case, both classes of shares share pro rata in the income and losses of the Company.
In
accordance with SEC Staff Accounting Bulletin No. 99, “Materiality,” and SEC Staff Accounting Bulletin No. 108, “Considering
the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements,” the Company evaluated
the corrections and has determined that the related impact was material to the previously filed financial statements that contained the
error. Therefore, the Company, in consultation with its Audit Committee, concluded that the following financial statements should be
restated: (i) audited balance sheet as of November 24, 2020 (the “Post IPO Balance Sheet”), as previously revised in the Company’s
Annual Report on Form 10-K, as amended, for the fiscal year ended December 31, 2020, filed with the SEC on June 4, 2021 (“2020
Form 10-K/A No. 1”); (ii) audited financial statements included in the 2020 Form 10-K/A No. 1; (iii) unaudited interim financial
statements included in the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2021, filed with the
SEC on June 8, 2021; and (iv) unaudited interim financial statements included in the Company’s Quarterly Report on Form 10-Q for
the quarterly period ended June 30, 2021, filed with the SEC on August 13, 2021 (collectively, the “Affected Periods”), should
be restated to report all Public Shares as temporary equity and should no longer be relied upon. As such, the Company will restate its
financial statements for the Affected Periods in this Form 10-K/A for the Post IPO Balance Sheet and the Company’s audited financial
statements included in the 2020 Form 10-K/A No. 1. The unaudited condensed financial statements for the periods ended March 31, 2021
and June 30, 2021 will be amended in the Company’s Quarterly Report on Form 10-Q/A for the quarterly period ended September 30,
2021, to be filed with the SEC (the “Q3 Form 10-Q”).
The
restatement does not have an impact on the Company’s cash position and cash held in the trust account established in connection
with the IPO (the “Trust Account”).
The
table below presents the effect of the financial statement adjustments related to the restatement discussed above of the Company’s
previously reported balance sheet as of December 31, 2020:
As of December
31, 2020
|
|
As Reported
As Previously
Restated in
10-K/A
Amendment
No. 1
|
|
|
Adjustment
|
|
|
As Restated
|
|
Class A common stock subject to possible
redemption
|
|
|
174,231,060
|
|
|
|
32,268,940
|
|
|
|
206,500,000
|
|
Class A common stock
|
|
|
322
|
|
|
|
(322
|
)
|
|
|
-
|
|
Additional paid-in capital
|
|
|
8,880,763
|
|
|
|
(8,880,763
|
)
|
|
|
-
|
|
Accumulated deficit
|
|
|
(3,881,651
|
)
|
|
|
(23,387,855
|
)
|
|
|
(27,269,506
|
)
|
Total stockholders’ equity (deficit)
|
|
$
|
5,000,009
|
|
|
$
|
(32,268,940
|
)
|
|
$
|
(27,268,931
|
)
|
The Company’s statement of stockholders’
equity (deficit) has been restated to reflect the changes to the impacted shareholders’ equity accounts described above.
The table below presents
the effect of the financial statement adjustments related to the restatement discussed above of the Company’s previously reported
statement of cash flows for the period from September 9, 2020 (inception) through December 31, 2020:
For the Period from September
9, 2020 (Inception) through December 31, 2020
|
|
|
As Reported
As Previously
Restated in
10-K/A
Amendment
No. 1
|
|
|
Adjustment
|
|
|
As Restated
|
|
Initial value of Class A common stock subject to possible redemption
|
|
$
|
170,500,700
|
|
|
$
|
(170,500,700
|
)
|
|
$
|
-
|
|
Change in Value of Class A common stock subject to possible redemption
|
|
$
|
3,730,360
|
|
|
$
|
(3,730,360.00
|
)
|
|
$
|
-
|
|
The impact to the reported
amounts of weighted average shares outstanding and basic and diluted earnings per share is presented below for the period from September
9, 2020 (inception) through December 31, 2020:
|
|
Earnings Per Share
|
|
|
|
As Reported
As Previously
Restated in
10-K/A
Amendment
No. 1
|
|
|
Adjustment
|
|
|
As Restated
|
|
For the Period from September 9, 2020 (Inception) through December 31, 2020
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(3,881,651
|
)
|
|
$
|
-
|
|
|
$
|
(3,881,651
|
)
|
Weighted average shares outstanding - Class A common stock
|
|
|
20,547,368
|
|
|
|
(12,159,669
|
)
|
|
|
8,395,699
|
|
Basic and diluted loss per share - Class A common stock
|
|
$
|
-
|
|
|
$
|
(0.29
|
)
|
|
$
|
(0.29
|
)
|
Weighted average shares outstanding - Class B common stock
|
|
|
5,055,914
|
|
|
|
-
|
|
|
|
5,055,914
|
|
Basic and diluted loss per share - Class B common stock
|
|
$
|
(0.55
|
)
|
|
$
|
0.26
|
|
|
$
|
(0.29
|
)
|
The table below presents
the effect of the financial statement adjustments related to the restatement discussed above of the Company’s previously reported
balance sheet as of November 24, 2020:
As of November 24,
2020
|
|
As Reported
As Previously
Restated in
10-K/A
Amendment
No. 1
|
|
|
Adjustment
|
|
|
As Restated
|
|
Total assets
|
|
$
|
202,148,859
|
|
|
|
|
|
|
$
|
202,148,859
|
|
Total liabilities
|
|
$
|
26,648,154
|
|
|
|
|
|
|
$
|
26,648,154
|
|
Class A common stock subject to possible redemption
|
|
|
170,500,700
|
|
|
|
29,499,300
|
|
|
|
200,000,000
|
|
Preferred stock
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
Class A common stock
|
|
|
295
|
|
|
|
(295
|
)
|
|
|
-
|
|
Class B common stock
|
|
|
575
|
|
|
|
-
|
|
|
|
575
|
|
Additional paid-in capital
|
|
|
6,831,060
|
|
|
|
(6,831,060
|
)
|
|
|
-
|
|
Accumulated deficit
|
|
|
(1,831,925
|
)
|
|
|
(22,667,945
|
)
|
|
|
(24,499,870
|
)
|
Total stockholders’ equity (deficit)
|
|
$
|
5,000,005
|
|
|
$
|
(29,499,300
|
)
|
|
$
|
(24,499,295
|
)
|
Total Liabilities, Class A Common
Stock Subject to Possible Redemption and Stockholders’ Equity (Deficit)
|
|
$
|
202,148,859
|
|
|
$
|
-
|
|
|
$
|
202,148,859
|
|
Note 3—Basis
of Presentation and Summary of Significant Accounting Policies
Basis
of Presentation
The
accompanying financial statements are presented in U.S. dollars, in conformity with accounting principles generally accepted in the United
States of America (“GAAP”) for financial information and pursuant to the rules and regulations of the Securities and Exchange
Commission (“SEC”).
As
described in Note 2—Restatement of Previously Issued Financial Statements, the Company’s financial statements for the period
from September 9, 2020 (inception) through December 31, 2020 (the “Affected Period”), are restated in this Annual Report
on Form 10-K/A (Amendment No. 1) (this “Annual Report”) to correct the misapplication of accounting guidance related to the
Company’s Warrants in the Company’s previously issued audited and unaudited condensed financial statements for such periods. The
restated financial statements are indicated as “Restated” in the audited and unaudited condensed financial statements and
accompanying notes, as applicable. See Note 2—Restatement of Previously Issued Financial Statements for further discussion.
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 auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, 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 an emerging growth company can elect to opt out of the extended transition period and comply with
the requirements that apply to non-emerging growth companies but any such an election to opt out is irrevocable.
The Company has elected not to opt out of such extended transition period, which means that when a standard is issued or revised and
it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or
revised standard at the time private companies adopt the new or revised standard.
This
may make comparison of the Company’s financial statements with another public company that is neither an emerging growth company
nor an emerging growth company that 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 GAAP requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the
reported amounts of revenues and 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 statements, which management considered in formulating its estimate, could change in the near term due to one
or more future confirming events. Actual results could differ 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, 2020.
Concentration
of Credit Risk
Financial
instruments that potentially subject the Company to concentration of credit risk consist of cash accounts in a financial institution
which, at times, may exceed the Federal Deposit Insurance Corporation coverage of $250,000, and investments held in Trust Account. The
Company has not experienced losses on these accounts and management believes the Company is not exposed to significant risks on such
accounts.
Investments
Held in the Trust Account
The
Company’s portfolio of investments held in the Trust Account is comprised of U.S. government securities, within the meaning set
forth in Section 2(a)(16) of the Investment Company Act, with a maturity of 185 days or less, or investments in money market funds that
invest in U.S. government securities, or a combination thereof. The Company’s investments held in the Trust Account are classified
as trading securities. Trading securities are presented on the balance sheet at fair value at the end of each reporting period. Gains
and losses resulting from the change in fair value of these investments are included in interest and dividends from investments held
in Trust Account in the accompanying statement of operations. The estimated fair values of investments held in the Trust Account are
determined using available market information, other than for investments in open-ended money market funds with published daily net asset
values (“NAV”), in which case the Company uses NAV as a practical expedient to fair value. The NAV on these investments is
typically held constant at $1.00 per unit.
Fair
Value Measurement
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. 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:
|
●
|
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
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.
As
of December 31, 2020, the carrying values of cash, accounts payable, accrued expenses, due to related party and franchise tax payable
approximate their fair values due to the short-term nature of the instruments. As of December 31, 2020, the Company’s investments
held in Trust Account are comprised of investments in U.S. Treasury securities with an original maturity of 185 days or less and are
recognized at fair value. The fair value of investments held in Trust Account is determined using quoted prices in active markets.
The
fair value of Public Warrants and Private Warrants was estimated at each measurement date using a binomial / lattice model that assumes
optimal exercise of the Company’s redemption option, including the make whole table, at the earliest possible date.
Offering
Costs Associated with the Initial Public Offering
The
Company complies with the requirements of the FASB ASC Topic 340-10-S99-1 and SEC Staff Accounting Bulletin Topic 5A – “Expenses
of Offering.” Offering costs consist of costs incurred in connection with the formation and preparation for the Initial Public
Offering. Offering costs are 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 associated with warrant liabilities are expensed as incurred, presented
as non-operating expenses in the statement of operations. Offering costs associated with the Public Shares were charged against the carrying
value of the Class A common stock subject to possible redemption upon the completion of the Initial Public Offering. The Company
classifies deferred underwriting commissions as non-current liabilities as their liquidation is not reasonably expected to require the
use of current assets or require the creation of current liabilities.
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 ASC 480. Shares
of Class A common stock subject to mandatory redemption (if any) are classified as liability instruments and are measured at fair
value. Shares of conditionally redeemable Class A common stock (including Class A common stock that feature redemption rights
that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the
Company’s control) are classified as temporary equity. At all other times, shares of Class A common stock are 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 the occurrence of uncertain future events. Accordingly, as of December 31, 2020,
a total of 20,650,000 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 sheet. Under ASC 480-10-S99, the Company has elected to recognize changes in the redemption value immediately as they
occur and adjust the carrying value of the security to equal the redemption value at the end of each reporting period. This method would
view the end of the reporting period as if it were also the redemption date for the security.
Immediately
upon the closing of the Initial Public Offering, the Company recognized the accretion from initial book value to redemption amount. The
change in the carrying value of Class A common stock subject to possible redemption resulted in charges against additional paid-in
capital and accumulated deficit.
Net
Loss Per Share of Common Stock
The Company has two
classes of shares, Class A common stock and Class B common stock. Income and losses are shared pro rata between the two classes
of shares. Net income (loss) per common stock is computed by dividing net income (loss) by the weighted-average number of shares of common
stock outstanding during the periods. The Company has not considered the effect warrants sold in the Initial Public Offering and the
Private Placement, an aggregate of 16,455,000 warrants, would have on diluted net income (loss) per share if exercised to purchase the
Company’s Class A common stock because their exercise is contingent upon future events and their inclusion would be anti-dilutive
under the treasury stock method. As a result, diluted net income (loss) per common stock is the same as basic net income (loss) per share
of common stock for the period from September 9, 2020 (inception) through December 31, 2020. Accretion associated with the Class A
common stock subject to possible redemption is excluded from earnings per share as the redemption value approximates fair value.
The following table reflects the calculation
of basic and diluted net loss per share of common stock:
|
|
For The
Period From
September
9,
2020
(inception) through
December 31,
2020
|
|
|
|
Class A
|
|
|
Class B
|
|
Basic and diluted net loss per common share:
|
|
|
|
|
|
|
Numerator:
|
|
|
|
|
|
|
Allocation of net loss
|
|
$
|
(2,422,696
|
)
|
|
$
|
(1,458,955
|
)
|
|
|
|
|
|
|
|
|
|
Denominator:
|
|
|
|
|
|
|
|
|
Basic and diluted weighted average common shares outstanding
|
|
|
8,395,699
|
|
|
|
5,055,914
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net loss per common share
|
|
$
|
(0.29
|
)
|
|
$
|
(0.29
|
)
|
Derivative
Warrant Liabilities
The
Company does not use derivative instruments to hedge its exposures to cash flow, market or foreign currency risks. Management evaluates
all of the Company’s financial instruments, including issued warrants to purchase its Class A common stock, to determine if such
instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480 and ASC 815-40. The classification
of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end
of each reporting period. The classification of derivative instruments, including whether such instruments should be recorded as liabilities
or as equity, is re-assessed at the end of each reporting period.
The
Company issued 10,325,000 warrants to purchase Class A common stock, including Over-Allotment Units, to investors in our Initial Public
Offering and issued 6,130,000 Private Placement Warrants. All of the Company’s outstanding warrants are recognized as derivative
liabilities in accordance with ASC 815-40. Accordingly, the Company recognizes the warrant instruments as liabilities at fair value and
adjusts the instruments to fair value at each reporting period. The liabilities are subject to re-measurement at each balance sheet date
until exercised, and any change in fair value is recognized in the statement of operations. The fair value of Public Warrants and Private
Warrants was estimated at each measurement date using a binomial / lattice model that assumes optimal exercise of the Company’s
redemption option, including the make whole table, at the earliest possible date.
Income
Taxes
The
Company follows the asset and liability method of accounting for income taxes under FASB ASC Topic 740, “Income Taxes” (“ASC
740”), which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred tax assets
and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement
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.
FASB
ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax
positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not
to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized
tax benefits as income tax expense.
Recent
Accounting Pronouncements
Management
does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have an effect
on the Company’s financial statements.
Note
4—Initial Public Offering
On
November 24, 2020, the Company consummated its Initial Public Offering of 20,000,000 Units at $10.00 per Unit, generating gross
proceeds of $200.0 million, and incurring offering costs of approximately $11.6 million, inclusive of $7.0 million in
deferred underwriting commissions. On November 30, 2020, the underwriters purchased an additional 650,000 Over-Allotment Units, generating
gross proceeds of $6.5 million, and incurred additional offering costs of $357,500 in underwriting fees (inclusive of $227,500 in deferred
underwriting fees).
Each
Unit consists of one share of Class A common stock and one-half of one redeemable warrant (each, a “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 7).
Note
5—Related Party Transactions
Founder
Shares
On
September 30, 2020, the Sponsor purchased 10,062,500 shares of the Company’s Class B common stock, par value $0.0001
per share (the “Founder Shares”), for an aggregate price of $25,000. On November 13, 2020 and November 19, 2020,
respectively, the Sponsor surrendered 2,875,000 and 1,437,500 shares of Class B common stock to the Company for cancellation for
no consideration, resulting in an aggregate of 5,750,000 shares of Class B common stock outstanding. All share and per share amounts
were retroactively restated to reflect the share surrenders and cancellations. The Initial Stockholders agreed to forfeit up to 750,000
Founder Shares to the extent that the over-allotment option is not exercised in full by the underwriters, so that the Founder Shares
will represent 20.0% of the Company’s issued and outstanding shares after the Initial Public Offering. On November 30, 2020, the
underwriters partially exercised the over-allotment option to purchase an additional 650,000 Units; thus, only 587,500 shares of Class
B common stock remain subject to forfeiture. The remaining unexercised over-allotment option expired on January 8, 2021; thus, 587,500
shares of Class B common stock held by the Sponsor were forfeited.
The
Initial Stockholders agreed, subject to limited exceptions, not to transfer, assign or sell any of the Founder Shares until the earlier
to occur of: (i) one year after the completion of the initial Business Combination; and (ii) the date following the completion
of the initial Business Combination on which the Company completes a liquidation, merger, capital stock exchange or other similar transaction
that results in all of the stockholders having the right to exchange their common stock for cash, securities or other property. Notwithstanding
the foregoing, if the closing price of 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 the initial Business Combination, the Founder Shares will be released from the lockup.
Private
Placement Warrants
Simultaneously
with the closing of the Initial Public Offering, the Company consummated the Private Placement of 6,000,000 Private Placement Warrants
at a price of $1.00 per Private Placement Warrant to the Sponsor, generating gross proceeds of $6.0 million. Simultaneously
with the closing of the Over-Allotment on November 30, 2020, the Company consummated the second closing of the Private Placement, resulting
in the purchase of an aggregate of an additional 130,000 Private Placement Warrants by the Sponsor, generating gross proceeds
to the Company of $130,000.
Each
whole Private Placement Warrant is exercisable for one whole share of Class A common stock at a price of $11.50 per share. A portion
of the proceeds from the sale of the Private Placement Warrants to the Sponsor was added to the 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 Private Placement
Warrants will expire worthless. The Private Placement Warrants will be non-redeemable for cash and exercisable on a cashless basis
so long as they are held by the Sponsor or its permitted transferees.
The
Sponsor and the Company’s officers and directors agreed, subject to limited exceptions, not to transfer, assign or sell any of
their Private Placement Warrants until 30 days after the completion of the initial Business Combination.
Related
Party Loans
On
September 30, 2020, the Sponsor agreed to loan the Company an aggregate of up to $300,000 to cover expenses related to the Initial
Public Offering pursuant to a promissory note (the “Note”). This loan is non-interest bearing and payable upon the completion
of the Initial Public Offering. The Company borrowed $104,788 under the Note and fully repaid the Note on November 24, 2020.
In
addition, 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 will 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.
The Working Capital Loans would either be repaid upon consummation of a Business Combination or, at the lender’s discretion, up
to $1.5 million of such Working Capital Loans may be convertible into warrants of the post Business Combination entity at a price
of $1.00 per warrant. The warrants would be identical to the Private Placement Warrants. 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. As of December 31,
2020, the Company had no borrowings under the Working Capital Loans.
Administrative
Services Agreement
The
Company entered into an agreement that provided that, commencing on the effective date of the prospectus through the earlier of
consummation of the initial Business Combination and the Company’s liquidation, the Company agreed to pay the Sponsor a total
of $4,000 per month for office space, secretarial, expense for period and administrative services provided to members of the
Company’s management team. We incurred $8,000 in expenses in connection with such services during the period from September 9,
2020 (inception) through December 31, 2020, as included in administrative expenses - related party on the accompanying statement of
operations. None was paid as of December 31, 2020, and the outstanding balance was included in accounts payable - related party in
the accompanying balance sheet.
The
Company’s officers or directors will be reimbursed for any out-of-pocket expenses incurred in connection with activities on
the Company’s behalf such as identifying potential target businesses and performing due diligence on suitable Business Combinations.
The Company’s audit committee will review on a quarterly basis all payments that were made to the Sponsor, officers or directors,
or the Company’s or their affiliates. Any such payments prior to an initial Business Combination will be made using funds held
outside the Trust Account. Other than quarterly audit committee review of such payments, the Company does not expect to have any additional
controls in place governing the reimbursement payments to the Company’s directors and officers for their out-of-pocket expenses
incurred in connection with identifying and consummating an initial Business Combination.
Note
6—Commitments and Contingencies
Registration
Rights
The
holders of Founder Shares, Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans, if any
(and any shares of 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), are entitled to registration rights pursuant to a registration rights agreement. The holders
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 the initial Business Combination. The Company will bear the expenses incurred in connection with the filing of any
such registration statements.
Underwriting
Agreement
The
underwriters were entitled to an underwriting discount of $0.20 per Unit, or $4.0 million in the aggregate, paid upon the closing
of the Initial Public Offering. In addition, the underwriters are entitled to a deferred fee of $0.35 per Unit, or $7.0 million
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.
In
connection with the consummation of the Over-Allotment on November 30, 2020, the underwriters were entitled to an additional fee of $130,000
paid upon closing, and $227,500 in deferred underwriting commissions.
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 statement. The financial statement
does not include any adjustments that might result from the outcome of this uncertainty.
Note
7—Derivative Warrant Liabilities
Public
Warrants may only be exercised for a whole number of shares. No fractional Public Warrants will be issued upon separation of the Units
and only whole Public Warrants will trade. The Public Warrants will become exercisable on the later of (a) 30 days after the completion
of a Business Combination or (b) 12 months from the closing of the Initial Public Offering; provided in each case that the Company
has an effective registration statement under the Securities Act covering the shares of Class A common stock issuable upon exercise
of the Public Warrants and a current prospectus relating to them is available (or the Company permits holders to exercise their Public
Warrants on a cashless basis and such cashless exercise is exempt from registration under the Securities Act). The Company has agreed
that as soon as practicable, but in no event later than 15 business days after the closing of the initial Business Combination, it will
use its commercially reasonable efforts to file with the SEC and have an effective registration statement covering the shares of the
Class A common stock issuable upon exercise of the warrants and to maintain a current prospectus relating to those shares of the
Class A common stock until the warrants expire or are redeemed. If a registration statement covering the shares of the Class A
common stock issuable upon exercise of the warrants is not effective by the 60th business day after the closing of the
initial 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.
The
warrants have an exercise price of $11.50 per share, subject to adjustments, and will expire five years after the completion of a Business
Combination or earlier upon redemption or liquidation. 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 the initial Business Combination
at an issue price or effective issue price of less than $9.20 per share (with such issue price or effective issue price to be determined
in good faith by the 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 the initial Business Combination on the date of the consummation of the initial Business Combination (net
of redemptions), and (z) the volume weighted average trading price of the common stock during the 20 trading day period starting
on the trading day prior to the day on which the Company consummates its initial 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 $18.00 per share redemption trigger price described under “Redemption
of warrants when the price per share of Class A common stock equals or exceeds $18.00” and “Redemption of warrants
when the price per share of Class A common stock equals or exceeds $10.00” will be adjusted (to the nearest cent) to be equal
to 180% of the higher of the Market Value and the Newly Issued Price, and the $10.00 per share redemption trigger described under “Redemption
of warrants when the price per share of Class A common stock equals or exceeds $10.00” will be adjusted (to the nearest cent)
to be equal to the higher of the Market Value and the Newly Issued Price.
The
Private Placement Warrants are identical to the Public Warrants, except that the Private Placement Warrants and the shares of Class A
common stock issuable upon 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 non-redeemable so long as they are held by the Sponsor or its permitted transferees. If the Private Placement Warrants are held
by someone other than the Sponsor or its 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.
Redemption
of warrants when the price per share of Class A common stock equals or exceeds $18.00:
Once
the warrants become exercisable, the Company may redeem the outstanding warrants for cash:
|
●
|
in whole and not in part;
|
|
●
|
at a price of $0.01 per
warrant;
|
|
●
|
upon a minimum of 30 days’
prior written notice of redemption; and
|
|
●
|
if, and only if, the last
reported sale price (the “closing price”) of Class A common stock equals or exceeds $18.00 per share (as adjusted)
for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which the Company
sends the notice of redemption to the warrant holders.
|
The
Company will not redeem the warrants as described above unless an effective registration statement under the Securities Act covering
the shares of Class A common stock issuable upon exercise of the warrants is effective and a current prospectus relating to those
shares of Class A common stock is available throughout the 30-day redemption period. Any such exercise would not be on a “cashless”
basis and would require the exercising holder to pay the exercise price for each warrant being exercised.
Redemption
of warrants when the price per share of Class A common stock equals or exceeds $10.00:
Once
the warrants become exercisable, the Company may redeem the outstanding warrants:
|
●
|
in whole and not in part;
|
|
●
|
at $0.10 per warrant upon
a minimum of 30 days’ prior written notice of redemption, provided that holders will be able to exercise
their warrants, but only on a cashless basis, prior to redemption and receive that number of shares determined by reference to an
agreed table based on the redemption date and the “fair market value” of Class A common stock;
|
|
●
|
if, and only if, the closing
price of Class A common stock equals or exceeds $10.00 per share (as adjusted) for any 20 trading days within the 30-trading day
period ending three trading days before the Company sends the notice of redemption to the warrant holders; and
|
|
●
|
if the closing price of
Class A common stock for any 20 trading days within a 30-trading day period ending on the third trading day prior to the
date on which the Company sends the notice of redemption to the warrant holders is less than $18.00 per share (as adjusted), the
Private Placement Warrants must also be concurrently called for redemption on the same terms as the outstanding Public Warrants,
as described above.
|
The
“fair market value” of Class A common stock for the above purpose shall mean the volume-weighted average price
of Class A common stock during the 10 trading days ending on the third trading day immediately following the date on which the notice
of redemption is sent to the holders of warrants. In no event will the warrants be exercisable in connection with this redemption feature
for more than 0.361 shares of Class A common stock per warrant (subject to adjustment).
In
no event will the Company be required to net cash settle any warrant. 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.
Note 8—Class A
Common Stock Subject to Possible Redemption
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 the occurrence of future events. As of December 31, 2020, there were 20,650,000
shares of Class A common stock outstanding, which were all subject to possible redemption.
The Class A common stock
issued in the Initial Public Offering and issued as part of the Over-Allotment Units were recognized in Class A common stock subject
to possible redemption as follows:
Gross Proceeds of initial public offering and over-allotment
|
|
$
|
206,500,000
|
|
Less:
|
|
|
—
|
|
Proceeds allocated to Public Warrants at issuance
|
|
|
(12,183,500
|
)
|
Offering costs allocated to Class A common stock subject to possible redemption
|
|
|
(11,228,780
|
)
|
Plus:
|
|
|
|
|
Accretion on Class A common stock subject to possible
redemption amount
|
|
|
23,412,280
|
|
Class A common stock subject to possible redemption
|
|
$
|
206,500,000
|
|
Note
9—Stockholders’ Equity (Deficit)
Class A
Common Stock —The Company is authorized to issue 380,000,000 shares of Class A common stock with a par value
of $0.0001 per share. As of December 31, 2020, there were 20,650,000 Class A common stock issued and outstanding,
all of which were subject to possible redemption and classified in temporary equity (see Note 8).
Class B
Common Stock — The Company is authorized to issue 20,000,000 shares of Class B common stock with a par value
of $0.0001 per share. On September 30, 2020, the Company issued 10,062,500 shares of Class B common stock to the Sponsor.
On November 13, 2020 and November 19, 2020, respectively, the Sponsor surrendered 2,875,000 and 1,437,500 shares of Class
B common stock to the Company for cancellation for no consideration, resulting in an aggregate of 5,750,000 shares of Class B common
stock outstanding. All shares and associated amounts have been retroactively restated to reflect the share surrenders. Of the 5,750,000 shares
of Class B common stock outstanding, up to 750,000 shares were subject to forfeiture to the extent that the underwriters’
over-allotment option were not exercised in full or in part, so that the Initial Stockholders will collectively own 20% of the Company’s
issued and outstanding common stock after the Initial Public Offering. On November 30, 2020, the underwriters partially exercised the
over-allotment option to purchase an additional 650,000 Units; thus, only 587,500 shares of Class B common stock remain subject to forfeiture.
The remaining unexercised over-allotment option expired on January 8, 2021; thus, 587,500 shares of Class B common stock held by the
Sponsor were forfeited.
Only
holders of the Class B common stock have the right to vote on the election of directors prior to the Business Combination. Holders
of Class A common stock and holders of Class B common stock vote together as a single class on all other matters submitted
to a vote of our stockholders except as required by law.
The
Class B common stock will automatically convert into Class A common stock concurrently with or immediately following the consummation
of the initial Business Combination on a one-for-one basis, subject to adjustment for stock splits, stock dividends, reorganizations,
recapitalizations and the like, and subject to further adjustment as provided herein. In the case that additional shares of Class A
common stock or equity-linked securities are issued or deemed issued in connection with the initial Business Combination, the number
of shares of Class A common stock issuable upon conversion of all Founder Shares will equal, in the aggregate, on an as-converted basis,
20% of the total number of shares of Class A common stock outstanding after such conversion (after giving effect to any redemptions
of shares of Class A common stock by Public Stockholders), including the total number of shares of Class A common stock issued,
or deemed issued or issuable upon conversion or exercise of any equity-linked securities or rights issued or deemed issued, by the
Company in connection with or in relation to the consummation of the initial Business Combination, excluding any shares of Class A
common stock or equity-linked securities or rights exercisable for or convertible into shares of Class A common stock issued,
or to be issued, to any seller in the initial Business Combination and any private placement warrants issued to the Sponsor, officers
or directors upon conversion of Working Capital Loans, provided that such conversion of Founder Shares will never occur on a less than
one-for-one basis.
Preferred
Stock — The Company is authorized to issue 1,000,000 shares of preferred stock, par value $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. As of December 31, 2020, there were no shares of preferred stock issued or outstanding.
Note 10—Fair Value Measurements
The
following table presents information about the Company’s financial assets that are measured at fair value on a recurring basis
as of December 31, 2020 by level within the fair value hierarchy:
Description
|
|
Quoted Prices in Active Markets
(Level 1)
|
|
|
Significant Other Observable Inputs
(Level 2)
|
|
|
Significant Other Unobservable Inputs
(Level 3)
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments held in Trust Account - U.S. Treasury Securities
|
|
$
|
206,498,802
|
|
|
$
|
-
|
|
|
$
|
-
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivative warrant liabilities - Public warrants
|
|
|
-
|
|
|
|
-
|
|
|
|
13,319,250
|
|
Derivative warrant liabilities - Private placement warrants
|
|
|
-
|
|
|
|
-
|
|
|
|
7,907,700
|
|
Total Fair Value
|
|
$
|
206,498,802
|
|
|
|
-
|
|
|
|
21,226,950
|
|
|
(1)
|
Matures
on May 27, 2021 and excludes $651 of investments held in cash within the Trust Account.
|
Transfers
to/from Levels 1, 2, and 3 are recognized at the beginning of the reporting period. There were no transfers between levels of the hierarchy
during the period from September 9, 2020 (inception) through December 31, 2020.
The
fair value of Public Warrants and Private Warrants was estimated at each measurement date using a binomial / lattice model that assumes
optimal exercise of the Company’s redemption option, including the make whole table, at the earliest possible date. The estimated
fair value of the Public Warrants and Private Placement Warrants was determined using Level 3 inputs. For the period since September
8, 2020 (inception) until December 31, 2020, the Company recognized a charge to the statement of operations resulting from an increase
in the fair value of liabilities of approximately $1.8 million presented as change in fair value of derivative warrant liabilities on
the accompanying statement of operations.
Inherent
in a binomial / lattice model are assumptions related to expected stock-price volatility, expected life, risk-free interest rate and
dividend yield. The Company estimates the volatility of its Class A common stock warrants based on implied volatility from the Company’s
traded warrants and from historical volatility of select peer company’s Class A common stock that matches the expected remaining
life of the warrants. The risk-free interest rate is based on the U.S. Treasury zero-coupon yield curve on the grant date for a maturity
similar to the expected remaining life of the warrants. The expected life of the warrants is assumed to be equivalent to their remaining
contractual term. The dividend rate is based on the historical rate, which the Company anticipates remaining at zero.
The
following table provides quantitative information regarding Level 3 fair value measurements inputs at their measurement:
|
|
November 24,
2020
|
|
|
December 31,
2020
|
|
Exercise price
|
|
$11.50
|
|
|
$11.50
|
|
Stock price
|
|
$9.38
|
|
|
$9.65
|
|
Term (yrs)
|
|
5.5
|
|
|
5.5
|
|
Volatility
|
|
25.0%
|
|
|
25.0%
|
|
Risk-free rate
|
|
0.50%
|
|
|
0.50%
|
|
The
change in the fair value of the derivative warrant liabilities measured with Level 3 inputs for the period from September 9, 2020 (inception)
through December 31, 2020 is summarized as follows:
Derivative warrant liabilities at September 9, 2020 (inception)
|
|
$
|
-
|
|
Issuance of Public and Private Warrants
|
|
|
19,416,900
|
|
Change in fair value of derivative warrant liabilities
|
|
|
1,810,050
|
|
Derivative warrant liabilities at December 31, 2020
|
|
$
|
21,226,950
|
|
Note 11—Income Taxes
The
Company’s taxable income primarily consists of interest income on the Trust Account. The Company’s general and administrative
expenses are generally considered start-up costs and are not currently deductible. There was no income tax expense for the period from
September 9, 2020 (inception) through December 31, 2020.
The
income tax provision (benefit) consists of the following for the period from September 9, 2020 (inception) through December 31, 2020:
Current
|
|
|
|
Federal
|
|
$
|
-
|
|
State
|
|
|
-
|
|
Deferred
|
|
|
|
|
Federal
|
|
|
(51,194
|
)
|
State
|
|
|
-
|
|
Change in valuation allowance
|
|
|
51,194
|
|
Income tax provision
|
|
$
|
-
|
|
The
Company’s net deferred tax assets are as follows as of December 31, 2020:
Deferred tax assets:
|
|
|
|
Start-up/Organization costs
|
|
$
|
13,150
|
|
Net operating loss carryforwards
|
|
|
38,045
|
|
Total deferred tax assets
|
|
|
51,194
|
|
Valuation allowance
|
|
|
(51,194
|
)
|
Deferred tax asset, net of allowance
|
|
$
|
-
|
|
In
assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or 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 assets, 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.
There
were no unrecognized tax benefits as of December 31, 2020. No amounts were accrued for the payment of interest and penalties at December
31, 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.
A
reconciliation of the statutory federal income tax rate (benefit) to the Company’s effective tax rate (benefit) is as follows for
the period from September 9, 2020 (inception) through December 31, 2020:
Statutory Federal income tax rate
|
|
|
21.0
|
%
|
Change in fair value of derivative warrant liability, loss upon issuance of Private Placement Warrants and offering costs associated with derivative warrant liablities
|
|
|
(19.7
|
)%
|
Change in Valuation Allowance
|
|
|
(1.3
|
)%
|
Income Taxes Benefit
|
|
|
0.0
|
%
|
Note 12—Subsequent Events
Management has evaluated
subsequent events to determine if events or transactions occurring through June 3, 2021, the date the financial statements were available
to be issued, require potential adjustment to or disclosure in the financial statements. Other than described below, no other events
required recognition or disclosure.
The
remaining unexercised over-allotment option expired on January 8, 2021; thus, 587,500 shares of Class B common stock held by the Sponsor
were forfeited.
Exhibit
|
|
Description
|
3.1
|
|
Amended and Restated Certificate of Incorporation (Incorporated by reference to the corresponding exhibit to the Company’s Current Report on Form 8-K (File No. 001-39726), filed with the SEC on November 25, 2020).
|
3.2
|
|
Bylaws (Incorporated by reference to Exhibit 3.3 to Amendment No. 1 to the Company’s Registration Statement on Form S-l (File No. 333-249686), filed with the SEC on November 17, 2020).
|
4.1
|
|
Specimen Unit Certificate (Incorporated by reference to the corresponding exhibit to Amendment No. 1 to the Company’s Registration Statement on Form S-l (File No. 333-249686), filed with the SEC on November 17, 2020).
|
4.2
|
|
Specimen Class A common stock Certificate (Incorporated by reference to the corresponding exhibit to Amendment No. 1 to the Company’s Registration Statement on Form S-l (File No. 333-249686), filed with the SEC on November 17, 2020).
|
4.3
|
|
Specimen Warrant Certificate (Incorporated by reference to the corresponding exhibit to Amendment No. 1 to the Company’s Registration Statement on Form S-l (File No. 333-249686), filed with the SEC on November 17, 2020).
|
4.4
|
|
Warrant Agreement between the Company and Continental Stock Transfer & Trust Company, dated as of November 19, 2020 (Incorporated by reference to the corresponding exhibit to the Company’s Current Report on Form 8-K (File No. 001-39726), filed with the SEC on November 25, 2020).
|
4.5
(1)
|
|
Description of Securities
|
10.1
|
|
Letter Agreement, dated November 19, 2020, by and among the Company, Omnichannel Sponsor LLC and each of the initial stockholders of the Company (Incorporated by reference to the corresponding exhibit to the Company’s Current Report on Form 8-K (File No. 001-39726), filed with the SEC on November 25, 2020).
|
10.2
|
|
Investment Management Trust Agreement, dated November 19, 2020, by and between the Company and Continental Stock Transfer & Trust Company, as trustee. (Incorporated by reference to the corresponding exhibit to the Company’s Current Report on Form 8-K (File No. 001-39726), filed with the SEC on November 25, 2020).
|
10.3
|
|
Registration Rights Agreement, dated November 19, 2020, by and among the Company, Omnichannel Sponsor LLC and the other holders party thereto (Incorporated by reference to the corresponding exhibit to the Company’s Current Report on Form 8-K (File No. 001-39726), filed with the SEC on November 25, 2020).
|
10.4
|
|
Private Placement Warrants Purchase Agreement, dated November 19, 2020, by and among the Company, Omnichannel Sponsor LLC and the other parties thereto (Incorporated by reference to the corresponding exhibit to the Company’s Current Report on Form 8-K (File No. 001-39726), filed with the SEC on November 25, 2020).
|
31.1
|
|
Certification of Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
31.2
|
|
Certification of Principal Financial and Accounting Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
32.1
|
|
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.
|
32.2
|
|
Certification of Principal Financial and Accounting Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
101.INS
|
|
XBRL Instance Document
|
101.SCH
|
|
XBRL Taxonomy Extension
Schema Document
|
101.CAL
|
|
XBRL Taxonomy Extension
Calculation Linkbase Document
|
101.DEF
|
|
XBRL Taxonomy Extension
Definition Linkbase Document
|
101.LAB
|
|
XBRL Taxonomy Extension
Label Linkbase Document
|
101.PRE
|
|
XBRL Taxonomy Extension
Presentation Linkbase Document
|
(1) Incorporated by reference to the Initial 10-K filed on March 31, 2021.