Table of Contents
UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

10-Q/A

(Amendment No. 1)
(MARK ONE)

☒

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

For the quarter ended March 31,September 30, 2021

☐

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

For the transition period from
to

Commission file number:
001-40130

DHC ACQUISITION CORP.

(Exact Name of Registrant as Specified in Its Charter)

Cayman Islands
 
98-1574798
(State or other jurisdiction of
incorporation or organization)
 
(I.R.S. Employer
Identification No.)

535 Silicon Drive, Suite 100

Southlake, Texas

76092
(Address of principal executive offices)

(214)452-2300

(Issuer’s telephone number)

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

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange
on which registered

Units, each consisting of one share of Class A ordinary shares, $0.0001 par value, and
one-third
of one redeemable warrant
 
DHCAU
 
The Nasdaq Stock Market LLC
Class A ordinary shares included as part of the units
 
DHCA
 
The Nasdaq Stock Market LLC
Redeemable warrants included as part of the units, each whole warrant exercisable for one Class A ordinary share at an exercise price of $11.50
 
DHCAW
 
The Nasdaq Stock Market LLC

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

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

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

Large accelerated filer ☐  Accelerated filer ☐
Non-accelerated
filer		 
☒
  Smaller reporting company ☒
 
  Emerging growth company ☒

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

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

As of July 20
December
21
,
2021, there were
 30,945,072 Class A ordinary shares, $0.0001 par value and 7,736,268 Class B ordinary shares, $0.0001 par value, issued and outstanding.

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EXPLANATORY NOTE
DHC Acquisition Corp. (the “Company,” “we,” “us” or “our”) is filing this Amendment No. 1 to its Quarterly Report on Form 10-Q/A for the quarterly period ended September 30, 2021 (this “Quarterly Report”) to amend and restate certain terms in its Quarterly Report on Form 10-Q for the quarterly period September 30, 2021 originally filed with the Securities and Exchange Commission (the “SEC”) on November 12, 2021 (the “Original Quarterly Report”).
Background of Restatement
The Company has re-evaluated the Company’s application of ASC 480-10-S99-3A to its accounting classification of the redeemable Class A ordinary shares, par value $0.0001 per share (the “Class A ordinary shares”), issued as part of the units sold in the Company’s initial public offering (the “IPO”) on March 5, 2021. ASC 480-10-S99-3A provides that redemption provisions not solely within the control of the issuer require shares subject to redemption to be classified outside of permanent equity. Furthermore, ASC 480-10-25-6(b) provides guidance stating that in determining if an instrument is mandatorily redeemable, a provision that defers redemption until a specified liquidity level is reached would not affect classification of the instrument. As such, management has identified errors made in the historical financial statements where, at the closing of the Company’s Initial Public Offering, the Company improperly valued its Class A ordinary shares subject to possible redemption. The Company previously determined the Class A ordinary shares subject to possible redemption to be equal to the redemption value, while also taking into consideration a redemption cannot result in net tangible assets being less than $5,000,001. Management determined that the Class A ordinary shares can be redeemed or become redeemable subject to the occurrence of future events considered outside the Company’s control. Therefore, management concluded that the redemption value should include all Class A ordinary shares subject to possible redemption, resulting in the Class A ordinary shares subject to possible redemption being equal to their redemption value. As a result, management has noted a reclassification adjustment related to temporary equity and permanent equity as of the Initial Public Offering date and all subsequent reporting periods. 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.
As a result, the Company’s management, together with the Audit Committee of the Board of Directors of the Company (the “Audit Committee”), concluded that the Company’s previously issued (i) unaudited interim financial statements as of and for the quarterly period ended March 31, 2021 (the “Q1 2021 Financial Statements”) included in the Company’s Quarterly Report on Form 10-Q, filed with the SEC on May 24, 2021; and (ii) unaudited interim financial statements as of and for the three and six months ended June 30, 2021 (the “Q2 2021 Financial Statements”) included in the Company’s Quarterly Report on Form 10-Q, filed with the SEC on August 16, 2021 (collectively, the “Affected Periods”), should be restated to report all Class A common stock as temporary equity and should no longer be relied upon. As such, the Company is restating the Company’s financial statements for the Affected Periods in this Form 10-Q/A. These restatements result in a change in the initial carrying value of the Class A ordinary shares subject to possible redemption with the offset recorded to additional paid-in capital (to the extent available), accumulated deficit and Class A ordinary shares. The change in accounting for the Class A ordinary shares did not have any impact on our liquidity, total assets, total liabilities, cash flows, or net income (loss) in the Affected Periods. However, earnings per share during the Affected Periods was impacted due to a change in presentation relating to the restatements.
We are filing this Amendment No. 1 to amend and restate the Affected Periods with modification as necessary to reflect the restatements. The financial information that has been previously filed or otherwise reported for this period is superseded by the information in this Form 10-Q/A, and the financial statements and related financial information contained in the Original Quarterly Report should no longer be relied upon. On November 23, 2021, the Company filed a report on Form 8-K disclosing the non-reliance on the financial statements included in the Original Quarterly Report.
Internal Control Considerations
In connection with the restatement, management has re-evaluated the effectiveness of the Company’s disclosure controls and procedures and internal control over financial reporting as of September 30, 2021. The Company’s management has concluded that, in light of the errors described above, and the filing of the Original Quarterly Report, a material weakness exists in the Company’s internal control over financial reporting and that the Company’s disclosure controls and procedures were not effective. Management plans to enhance the system of evaluating and implementing the accounting standards that apply to our financial statements, including enhanced training of our personnel and increased communication among our personnel and third-party professionals with whom we consult regarding application of complex financial instruments. For a discussion of management’s consideration of our disclosure controls and procedures, internal controls over financial reporting, and the material weaknesses identified, see Part I, Item 4, “Controls and Procedures” of this Quarterly Report.
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DHC ACQUISITION CORP.

FORM 10-Q FOR THE QUARTER ENDED MARCH 31,SEPTEMBER 30, 2021

TABLE OF CONTENTS

   
Page
 

Part I. Financial Information

  

Item 1. Financial Statements

  

Unaudited Condensed Balance Sheets as of March  31,September 30, 2021 (Unaudited) and December 31, 2020

   1 

Unaudited Condensed StatementStatements of Operations for the three and nine months ended March  31,September 30, 2021 (Unaudited)

   2 

Unaudited Condensed Statement of Changes in Shareholders’ (Deficit) Equity for the three and nine months ended March 31,September 30, 2021 (Unaudited)

   3 

Unaudited Condensed Statement of Cash Flows for the threenine months ended March  31,September 30, 2021 (Unaudited)

   4 

Unaudited Notes to Condensed Financial Statements (Unaudited)(Restated)

   5 

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

   16 

Item 3. Quantitative and Qualitative Disclosures Regarding Market Risk

   18 

Item 4. Controls and Procedures

   18 

Part II. Other Information

  

Item 1. Legal Proceedings

   18 

Item 1A. Risk Factors

   19 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

   19 

Item 3. Defaults Upon Senior Securities

   1920 

Item 4. Mine Safety Disclosures

   1920 

Item 5. Other Information

   1920 

Item 6. Exhibits

   1920 

Part III. Signatures

   2122 

Table of Contents

PART I - FINANCIAL INFORMATION

Item 1. Interim Financial Statements.

DHC ACQUISITION CORP.

CONDENSED BALANCE SHEETS

   March 31,
2021		  December 31,
2020		 
   (Unaudited)    

ASSETS

   

Current assets

   

Cash

  $1,573,788   —   

Prepaid expenses

   872,378   —   
  

 

 

  

 

 

 

Total Current Assets

   2,446,166   —   

Deferred offering costs

   —     71,546 

Cash held in Trust Account

   309,450,720   —   
  

 

 

  

 

 

 

TOTAL ASSETS

  $311,896,886  $71,546 
  

 

 

  

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

   

Current liabilities

   

Accrued Expenses

  $50,738  $—   

Accrued offering expenses

   17,000   37,905 

Promissory note – related party

   —     13,641 
  

 

 

  

 

 

 

Total Current Liabilities

   67,738   51,546 

Warrant Liabilities

   16,934,265   —   

Deferred underwriting fee payable

   10,830,775   —   
  

 

 

  

 

 

 

Total Liabilities

   27,832,778   51,546 
  

 

 

  

 

 

 

Commitments and Contingencies

   

Class A ordinary shares subject to possible redemption; 27,906,410 and no shares at a redemption value of $10.00 per share at March 31, 2021 and December 31, 2020, respectively

   279,064,100   —   

Shareholders’ Equity

   

Preference shares, $0.0001 par value; 5,000,000 shares authorized; none issued and outstanding

   —     —   

Class A ordinary shares, $0.0001 par value; 500,000,000 shares authorized; 3,038,662 and no shares issued and outstanding (excluding 27,906,410 and no shares subject to possible redemption) at March 31, 2021 and December 31, 2020, respectively

   304   —   

Class B ordinary shares, $0.0001 par value; 50,000,000 shares authorized; 8,625,000 shares issued and outstanding at March 31, 2021 and December 31, 2020 (1)

   863   863 

Additional paid-in capital

   6,407,837   24,137 

Accumulated deficit

   (1,408,996)   (5,000) 
  

 

 

  

 

 

 

Total Shareholders’ Equity

   5,000,008   20,000 
  

 

 

  

 

 

 

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

  $311,896,886  $71,546 
  

 

 

  

 

 

 

   
September 30,

2021
  
December 31,

2020
 
   
(Unaudited)
    
ASSETS
         
Current assets
         
Cash
  $979,939   —   
Prepaid expenses
   554,997   —   
   
 
 
  
 
 
 
Total Current Assets
   1,534,936   —   
Deferred offering costs
   —     71,546 
Investment held in Trust Account
   309,450,720   0   
   
 
 
  
 
 
 
TOTAL ASSETS
  
$
310,985,656
 
 
$
71,546
 
   
 
 
  
 
 
 
LIABILITIES, CLASS A ORDINARY SHARES SUBJECT TO POSSIBLE REDEMPTION AND SHAREHOLDERS’ (DEFICIT) EQUITY
         
Current liabilities
         
Accrued expenses
  $334,597  $—   
Accrued offering expenses
   0     37,905 
Advance from related party
   123,780   —   
Promissory note – related party
   —     13,641 
   
 
 
  
 
 
 
Total Current Liabilities
   458,377   51,546 
Warrant liabilities
   11,508,724   0   
Deferred underwriting fee payable
   10,830,775   0   
   
 
 
  
 
 
 
Total Liabilities
  
 
22,797,876
 
 
 
51,546
 
Commitments and Contingencies
   0    0  
Class A ordinary shares subject to possible redemption; 30,945,072 and 0 shares at a redemption value of $10.00 per share at September 30, 2021 and December 31, 2020, respectively
   309,450,720   —   
Shareholders’ (Deficit) Equity
         
Preference shares, $0.0001 par value; 5,000,000 shares authorized; 0ne issued and outstanding
   0—     0—   
Class A ordinary shares, $0.0001 par value; 500,000,000 shares authorized
   0     —   
Class B ordinary shares, $0.0001 par value; 50,000,000 shares authorized; 7,736,268 and 8,625,000 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively
   774   863 
Additional
paid-in
capital
   0     24,137 
Accumulated deficit
   (21,263,714)   (5,000) 
   
 
 
  
 
 
 
Total Shareholders’ (Deficit) Equity
  
 
(21,262,940
) 
 
 
20,000
 
   
 
 
  
 
 
 
TOTAL LIABILITIES, CLASS A ORDINARY SHARES SUBJECT TO POSSIBLE REDEMPTION AND SHAREHOLDERS’ (DEFICIT) EQUITY
  
$
310,985,656
 
 
$
71,546
 
   
 
 
  
 
 
 
(1)

At December 31, 2020, included up to 1,125,000 shares subject to forfeiture if the over-allotment option was not exercised in full or in part by the underwriters. On March 1, 2021, the Company effected a share capitalization, pursuant to which an additional 1,437,500 Class B ordinary shares were issued, resulting in an aggregate of 8,625,000 Founder Shares outstanding. At March 31, 2021, the Founder Shares include an aggregate of up to 888,732 shares that were subject to forfeiture by the Sponsor following the underwriters’ election to partially exercise their over-allotment option. All share and associated amounts have been retroactively restated to reflect the share forfeiture (see Note 6).

The accompanying notes are an integral part of the unaudited condensed financial statements.

1
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DHC ACQUISITION CORP.

CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
   
For The
Three Months

Ended

September 30,
2021
  
For The

Nine Months

Ended

September 30,
2021
 
General and administrative expenses
  $549,272  $1,461,885 
   
 
 
  
 
 
 
Loss from operations
  
 
(549,272
) 
 
 
(1,461,885
) 
Other income (expense):
         
Change in fair value of warrant liabilities
   5,322,390   4,767,900 
Transaction costs allocated to warrant liabilities
   0     (586,339) 
   
 
 
  
 
 
 
Total other income (expense)
   5,322,390   4,181,561 
         
Net income
  
$
4,773,118
 
 
$
2,719,676
 
   
 
 
  
 
 
 
Basic weighted average shares outstanding, Class A ordinary shares
   30,945,072   23,913,792 
   
 
 
  
 
 
 
Basic net income per share, Class A ordinary shares
  
$
0.12
 
 
$
0.09
 
   
 
 
  
 
 
 
Basic weighted average shares outstanding, Class B ordinary
shares
   7,736,268   7,681,745 
   
 
 
  
 
 
 
Basic net income per share, Class B ordinary shares
  
$
0.12
 
 
$
0.09
 
   
 
 
  
 
 
 
Diluted weighted average shares outstanding, Class B ordinary shares
   7,736,268   7,736,268 
         
Diluted net income per share, Class B ordinary shares
  
$
0.12  
$
0.09 
         
The accompanying notes are an integral part of the unaudit
e
d condensed financial statements.
2
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DHC ACQUISITION CORP.
CONDENSED STATEMENT OF OPERATIONS

CHANGES IN SHAREHOLDERS’ (DEFICIT) EQUITY

THREE AND NINE MONTHS ENDED MARCH 31,SEPTEMBER 30, 2021

(UNAUDITED)

Operating and formation costs

  $160,016 
  

 

 

 

Loss from operations

   (160,016) 

Other expense:

  

Change in fair value of warrant liabilities

   (657,641) 

Transaction costs allocated to warrant liabilities

   (586,339) 
  

 

 

 

Other expense

   (1,243,980) 
  

 

 

 

Net loss

  $(1,403,996) 
  

 

 

 

Weighted average shares outstanding, Class A redeemable ordinary shares

   30,945,072 
  

 

 

 

Basic and diluted net income per share, Class A redeemable ordinary shares

  $(0.00) 
  

 

 

 

Weighted average shares outstanding, Class B non-redeemable ordinary shares (1)

   7,570,880 
  

 

 

 

Basic and diluted net loss per share, Class B non-redeemable ordinary shares

  $(0.19) 
  

 

 

 

   
Class B

Ordinary Shares
  
Additional
Paid-in
  
Accumulated
  
Total
Shareholders’
 
   
Shares
  
Amount
  
Capital
  
Deficit
  
Equity (Deficit)
 
Balance — January 1, 2021
  
 
8,625,000
 
 
$
863
 
 
$
24,137
  
$
(5,000
) 
 
$
20,000
 
Cash Paid in excess of fair value for private warrants
   —     —    3,133,522   —     3,133,522 
Forfeiture of Founder Shares
   (888,732
)
 
  (89
)
 
 89   —     —   
Accretion for Class A ordinary shares to redemption amount
   —     —    (3,157,748
)
 
  (23,978,390)   (27,136,138) 
Net loss
   —     —    —     (1,403,996)   (1,403,996) 
    
 
  
 
 
   
 
  
 
 
  
 
 
 
Balance – March 31, 2021
, as restated – see Note 2
(unaudited)
  
 
7,736,268
 
 
$
774
 
 
$
0—  
  
$
(25,387,386
) 
 
$
(25,386,612
) 
Net loss
   —     —    —     (649,446)   (649,446) 
    
 
  
 
 
   
 
  
 
 
  
 
 
 
Balance – June 30, 2021
, as restated – see Note 2
(unaudited)
  
 
7,736,268
 
 
$
774
 
 
$
0—  
  
$
(26,036,832
) 
 
$
(26,036,058
) 
Net income
   —     —    —     4,773,118   4,773,118 
    
 
  
 
 
   
 
  
 
 
  
 
 
 
Balance – September 30, 2021 (unaudited)
  
 
7,736,268
 
 
$
774
 
 
$
0—  
  
$
(21,263,714
) 
 
$
(21,262,940
) 
    
 
  
 
 
  
 
  
 
 
  
 
 
 
(1)

At December 31, 2020, excluded up to 1,125,000 shares subject to forfeiture if the over-allotment option was not exercised in full or in part by the underwriters. On March 1, 2021, the Company effected a share capitalization, pursuant to which an additional 1,437,500 Class B ordinary shares were issued, resulting in an aggregate of 8,625,000 Founder Shares outstanding. At March 31, 2021, The Founder Shares include an aggregate of up to 888,732 shares that were subject to forfeiture by the Sponsor following the underwriters’ election to partially exercise their over-allotment option. All share and associated amounts have been retroactively restated to reflect the share forfeiture (see Note 6).

The accompanying notes are an integral part of the unaudited condensed financial statements.

3
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DHC ACQUISITION CORP.

CONDENSED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

THREECASH FLOWS

FOR THE NINE MONTHS ENDED MARCH 31,SEPTEMBER 30, 2021

(UNAUDITED)

   Class A
Ordinary Shares		  Class B (1)
Ordinary Shares		   

Additional

Paid-in

  Accumulated  

Total

Shareholders’

 
   Shares  Amount  Shares   Amount   Capital  Deficit  Equity 

Balance —   January 1, 2021

   —    $—     8,625,000   $863   $24,137  $(5,000)  $20,000 

Sale of 30,945,072 Units, net of underwriting discounts, fair value of Public Warrants and offering costs

   30,945,072   3,095   —      —      282,311,487   —     282,314,582 

Cash Paid in excess of fair value for private warrants

   —     —     —      —      3,133,522   —     3,133,522 

Ordinary shares subject to possible redemption

   
(27,906,410
) 
  (2,791)   —      —      
(279,061,309
) 
  —     
(279,064,100
) 

Net loss

   —     —     —      —      —     (1,403,996)   (1,403,996) 
  

 

 

  

 

 

  

 

 

   

 

 

   

 

 

  

 

 

  

 

 

 

Balance – March 31, 2021

   3,038,662  $304   8,625,000   $863   $6,407,837  $(1,408,996)  $5,000,008 
  

 

 

  

 

 

  

 

 

   

 

 

   

 

 

  

 

 

  

 

 

 

(1)

At December 31, 2020, included up to 1,125,000 shares subject to forfeiture if the over-allotment option was not exercise in full or in part by the underwriters. On March 1, 2021, the Company effected a share capitalization, pursuant to which an additional 1,437,500 Class B ordinary shares were issued, resulting in an aggregate of 8,625,000 Founder Shares outstanding. At March 31, 2021, the Founder Shares include an aggregate of up to 888,732 that were subject to forfeiture by the Sponsor following the underwriters’ election to partially exercise their over-allotment option. All share and associated amounts have been retroactively restated to reflect the share forfeiture (see Note 6).

Cash Flows from Operating Activities:
     
Net income
  $2,719,676 
Adjustments to reconcile net
income
to net cash used in operating activities:
     
Change in fair value of warrant liabilities
   (4,767,900) 
Transaction costs allocated to warrant liabilities
   586,339 
Changes in operating assets and liabilities:
     
Prepaid expenses
   (528,197) 
Accrued expenses
   334,597 
   
 
 
 
Net cash used in operating activities
  
 
(1,655,485
) 
   
 
 
 
Cash Flows from Investing Activities:
     
Investment of cash in Trust Account
   (309,450,720) 
   
 
 
 
Net cash used in investing activities
  
 
(309,450,720
) 
   
 
 
 
Cash Flows from Financing Activities:
     
Proceeds from sale of Units, net of underwriting discounts paid
   303,261,706 
Proceeds from sale of Private Placement Warrants
   9,189,015 
Proceeds from advance from related party
   123,780 
Repayment of promissory note – related party
   (171,357) 
Payment of offering costs
   (317,000) 
   
 
 
 
Net cash provided by financing activities
  
 
312,086,144
 
   
 
 
 
Net Change in Cash
  
 
979,939
 
Cash – Beginning of period
   0—   
   
 
 
 
Cash – End of period
  
$
979,939
 
   
 
 
 
Non-Cash
investing and financing activities:
     
Offering costs paid through promissory note
  $130,916 
   
 
 
 
Payment of prepaid expenses through promissory note
  $26,800 
   
 
 
 
Deferred underwriting fee payable
  $10,830,775 
   
 
 
 
Forfeiture of Founder Shares
  $(89) 
   
 
 
 
The accompanying notes are an integral part of the unaudited condensed financial statements.

4
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DHC ACQUISITION CORP.

CONDENSED STATEMENT OF CASH FLOWS

THREE MONTHS ENDED MARCH 31, 2021

(UNAUDITED)

Cash Flows from Operating Activities:

  

Net loss

  $(1,403,996) 

Adjustments to reconcile net loss to net cash used in operating activities:

  

Change in fair value of warrant liabilities

   657,641 

Transaction costs allocated to warrant liabilities

   586,339 

Changes in operating assets and liabilities:

  

Prepaid expenses

   (845,578) 

Accrued expenses

   50,738 
  

 

 

 

Net cash used in operating activities

   (954,856) 
  

 

 

 

Cash Flows from Investing Activities:

  

Investment of cash in Trust Account

   (309,450,720) 
  

 

 

 

Net cash used in investing activities

   (309,450,720) 
  

 

 

 

Cash Flows from Financing Activities:

  

Proceeds from sale of Units, net of underwriting discounts paid

   303,261,706 

Proceeds from sale of Private Placement Warrants

   9,189,015 

Repayment of promissory note – related party

   (171,357) 

Payment of offering costs

   (300,000) 
  

 

 

 

Net cash provided by financing activities

   311,979,364 
  

 

 

 

Net Change in Cash

   1,573,788 

Cash – Beginning of period

   —   
  

 

 

 

Cash – End of period

  $1,573,788 
  

 

 

 

Non-Cash investing and financing activities:

  

Offering costs included in accrued offering costs

  $17,000 
  

 

 

 

Offering costs paid through promissory note

  $130,916 
  

 

 

 

Payment of prepaid expenses through promissory note

  $26,800 
  

 

 

 

Initial classification of Class A ordinary shares subject to possible redemption

   271,198,440 
  

 

 

 

Change in value of Class A ordinary shares subject to redemption

  $7,865,660 
  

 

 

 

Deferred underwriting fee payable

  $10,830,775 
  

 

 

 

Forfeiture of Founder Shares

  $(89) 
  

 

 

 

The accompanying notes are an integral part of the unaudited condensed financial statements.

DHC ACQUISITION CORP.

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

MARCH 31,

SEPTEMBER 30, 2021

(Unaudited)

(AS RESTATED)

NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS

DHC Acquisition Corp. (the “Company”) is a blank check company incorporated as a Cayman Islands exempted company on December 22, 2020. The Company was formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities (the “Business Combination”).

The Company is not limited to a particular industry or sector for purposes of consummating a Business Combination. The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies.

All activity through March 31,September 30, 2021 relates to the Company’s formation, the initial public offering (“Initial Public Offering”), which is described below, and subsequent to the Initial Public Offering, identifying a target company for a Business Combination. The Company will not generate any operating revenues until after the completion of a Business Combination, at the earliest. The Company will generate generates
non-operating
income in the form of interest income from the proceeds derivedinvestment held in the Trust Account (as defined below), along with income or loss from the Initial Public Offering. The Company has selected December 31 as its fiscal year end.

change in fair value of the warrant liabilities.

The registration statement for the Company’s Initial Public Offering was declared effective on March 1, 2021. On MarchM
a
rch 4, 2021, the Company consummated the Initial Public Offering of 30,000,000 units (the “Units” and, with respect to the Class A ordinary shares included in the Units sold, the “Public Shares”), at $10.00 per Unit, generating gross proceeds of $300,000,000 which is described in Note 4.

Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 6,000,000 warrants (the “Private Placement Warrants”) at a price of $1.50 per Private Placement Warrant in a private placement to DHC Sponsor, LLC (the “Sponsor”), generating gross proceeds of $9,000,000, which is described in Note 5.

Following the closing of the Initial Public Offering on March 4, 2021, an amount of $300,000,000 ($10.00 per Unit) from the net proceeds of the sale of the Units in the Initial Public Offering and the sale of the Private Placement Warrants was placed in a trust account (the “Trust Account”), located in the United States and will be invested only in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 185 days or less or in any open-ended investment company that holds itself out as a money market fund selected by the Company meeting the conditions of Rule
2a-7
of the Investment Company Act, as determined by the Company, until the earlier of (i) the completion of a Business Combination and (ii) the distribution of the funds held in the Trust Account, as described below.

On March 5, 2021, the underwriters partially exercised their over-allotment option, resulting in an additional 945,072 Units issued for an aggregate amount of $9,450,720. In connection with the underwriters’ partial exercise of their over-allotment option, the Company also consummated the sale of an additional 126,010 Private Placement Warrants at $1.50 per Private Placement Warrant, generating total proceeds of $189,015. A total of $9,450,720 was deposited into the Trust Account, bringing the aggregate proceeds held in the Trust Account to $309,450,720.

Transaction costs amounted to $17,501,346, consisting of $6,189,014 in cash underwriting fees, $10,830,775 of deferred underwriting fees and $481,557 of other offering costs.

The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of Private Placement Warrants, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. The rules of the stock exchange that the Company will list its securities on will require that the Company’s initial Business Combination must be with one or more target businesses that have an aggregate fair market value of at least 80% of the assets held in the Trust Account (excluding the deferred underwriting commissions and taxes payable on the income earned on the Trust Account) at the time of the signing of a definitive agreement in connection with the initial Business Combination. The Company will only complete a Business Combination if the post-transaction company owns or acquires 50% or more of the issued and outstanding 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. There is no assurance that the Company will be able to complete a Business Combination successfully.

The Company will provide the holders of its issued and outstanding Public Shares (the “public shareholders”) 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 shareholder meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek shareholder approval of a Business Combination or conduct a tender offer will be made by the Company. The public shareholders will be entitled to redeem their Public Shares, equal to the aggregate amount then on deposit in the Trust Account as of two business days prior to the consummation of the Business Combination, (initially anticipated to be $10.00 per Public Share, plus any pro rata interest earned on the funds held in the Trust Account and net of taxes payable), divided by the number of then issued and outstanding public shares. The
per-share
amount to be distributed to Public Shareholders 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)7). There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s warrants.

The Company will proceed with a Business Combination only if the Company has net tangible assets of at least $5,000,001 either immediately prior to or upon such consummation of a Business Combination and, if the Company seeks shareholder approval, it receives an ordinary resolution under Cayman Islands law approving a Business Combination, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the Company. If a shareholder vote is not required by applicable law or stock exchange listing requirements and the Company does not decide to hold a shareholder vote for business or other reasons, the Company will, pursuant to its Amended and Restated Memorandum and Articles of Association, conduct the redemptions pursuant to the tender offer rules of the U.S. Securities and Exchange Commission (the “SEC”)
SEC
and file tender offer documents with the SEC prior to completing a Business Combination. If, however, shareholder approval of the transactions is required by

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DHC ACQUISITION CORP.

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

MARCH 31,

SEPTEMBER 30, 2021

(Unaudited)

(AS RESTATED)
applicable law or stock exchange listing requirements, or the Company decides to obtain shareholder approval for business or other reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer rules. If the Company seeks shareholder approval in connection with a Business Combination, the Sponsor has agreed to vote any Founder Shares (as defined in Note 4)6) and Public Shares held by it in favor of approving a Business Combination. Additionally, each public shareholder may elect to redeem their Public Shares, without voting, and if they do vote, irrespective of whether they vote for or against an Initial Business Combination.

Notwithstanding the foregoing, if the Company seeks shareholder approval of a Business Combination and it does not conduct redemptions pursuant to the tender offer rules, the Company’s Amended and Restated Memorandum and Articles of Association will provide that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the Public Shares, without the prior consent of the Company.

The Sponsor and the Company’s officers and directors have agreed to waive: (i) their redemption rights with respect to any Founder Shares and Public Shares held by them in connection with the completion of the Company’s Business Combination and (ii) their redemption rights with respect to the Founder Shares and any Public Shares held by them in connection with a shareholder vote to approve an amendment to the Company’s Amended and Restated Memorandum and Articles of Association (A) to modify the substance or timing of the Company’s obligation to allow redemption in connection with a Business Combination or to redeem 100% of the Public Shares if the Company does not complete a Business Combination within 24 months from the closing of the Initial Public Offering or (B) with respect to any other provision relating to shareholders’ rights and (iii) waive their rights to liquidating distributions from the trust account with respect to any founder shares they hold if the Company fails to consummate an initial business combination within 24 months from the closing of this offering.

The Company will have until March 4, 2023 to complete a Business Combination (the “Combination Period”). If the Company has not completed a Business Combination within the Combination Period, the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible, but not more than 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 tax obligations (less up to $100,000$
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 shareholders’ rights as shareholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining shareholders and the Company’s board of directors, liquidate and dissolve, subject in each case to the Company’s obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to the Company’s warrants, which will expire worthless if the Company fails to complete a Business Combination within the Combination Period.

The Sponsor has agreed to waive its liquidation rights with respect to the Founder Shares if the Company fails to complete a Business Combination within the Combination Period. However, if the Sponsor acquires Public Shares in or after the Initial Public Offering, such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination within the Combination Period. The underwriters have agreed to waive their rights to their deferred underwriting commission (see Note 5)7) held in the Trust Account in the event the Company does not complete a Business Combination within the Combination Period and, in such event, such amounts will be included with the other funds held in the Trust Account that will be available to fund the redemption of the Public Shares. In the event of such distribution, it is possible that the
per-share
value of the assets remaining available for distribution will be less than the Initial Public Offering price per Unit ($10.00).

In order to protect the amounts held in the Trust Account, the Sponsor has agreed to be liable to the Company if and to the extent any claims by a third party (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 discussed entering into a transaction agreement, reduce the amounts in the Trust Account to below (i) $10.00 per Public Share or (ii) such lesser amount per Public Share held in the Trust Account as of the date of the liquidation of the Trust Account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes. This liability will not apply with respect to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account and except as to any claims under the Company’s indemnity of the underwriters of the Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers (except for the Company’s independent registered public accounting firm), prospective target businesses and other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account.

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DHC ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(AS RESTATED)
NOTE 2 — REVISION2. RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENT

STATEMENTS

In connection with the preparation of the Company’s financial statements as of September 30, 2021, management determined it should restate its previously reported financial statements. During the quarter ended September 30, 2021, the Company determined that at the closing of the Company’s Initial Public Offering (including the sale of the shares issued pursuant to the exercise of the underwriters’ overallotment) it had improperly recorded its Class A ordinary shares subject to possible redemption at the closing of the Company’s Initial Public Offering and the closing of the sale of shares pursuant to the exercise of the underwriters’ overallotment. The Company previously accounted for its outstanding Public Warrants (as defineddetermined the Class A ordinary shares subject to possible redemption to be equal to the redemption value of
$
10.00
 per Class A ordinary shares while also taking into consideration a redemption cannot result in Note 5) and Private Placement Warrants (collectively, withnet tangible assets being less than $
5,000,001
.
Management determined that the Public Warrants,Class A ordinary shares issued during the “Warrants”) issued in connection with its Initial Public Offering as components of equity instead of as derivative liabilities. The warrant agreement governing the Warrants includes a provision that provides for potential changesand pursuant to the settlement amounts dependent upon the characteristicsexercise of the holderunderwriters’ overallotment can be redeemed or become redeemable subject to the occurrence of future events considered outside the warrant. In addition, the warrant agreement includes a provisionCompany’s control. Therefore, management concluded that temporary equity should include all Class A ordinary shares subject to possible redemption, resulting in the event ofClass A ordinary shares subject to possible redemption being equal to their redemption value. As a tender offer or exchange offer made to and accepted by holders of more than 50% of the outstanding shares ofresult, management has noted a single class of stock, all holders of the Warrants would be entitled to receive cash for their Warrants (the “tender offer provision”).

DHC ACQUISITION CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS

MARCH 31, 2021

(Unaudited)

On April 12, 2021, the Acting Director of the Division of Corporation Finance and Acting Chief Accountant of the Securities and Exchange Commission together issued a statement regarding the accounting and reporting considerations for warrants issued by special purpose acquisition companies entitled “Staff Statement on Accounting and Reporting Considerations for Warrants Issued by Special Purpose Acquisition Companies (“SPACs”)” (the “SEC Statement”). Specifically, the SEC Statement focused on certain settlement terms and provisionsreclassification adjustment related to certain tender offers following a business combination, which terms are similar to those containedtemporary equity and permanent equity. This resulted in the warrant agreement.

In further consideration of the SEC Statement, the Company’s management further evaluated the Warrants under Accounting Standards Codification (“ASC”) Subtopic 815-40, Contracts in Entity’s Own Equity. ASC Section 815-40-15 addresses equity versus liability treatment and classification of equity-linked financial instruments, including warrants, and states that a warrant may be classified as a component of equity only if, among other things, the warrant is indexed to the issuer’s ordinary shares. Under ASC Section 815-40-15, a warrant is not indexed to the issuer’s ordinary shares if the terms of the warrant require an adjustment to the exercise price upon a specified event and that event is not an input to the fairinitial carrying value of the warrant. Based on management’s evaluation, the Company’s audit committee, in consultation with management, concluded that the Company’s Private Placement Warrants are not indexed to the Company’sClass A ordinary shares insubject to possible redemption with the manner contemplated by ASC Section 815-40-15 becauseoffset recorded to additional paid-in capital (to the holder of the instrument is not an input into the pricing of a fixed-for-fixed option on equity shares. In addition, based on management’s evaluation, the Company’s audit committee, in consultation with management, concluded that the tender offer provision fails the “classified in shareholders’ equity” criteria as contemplated by ASC Section 815-40-25.

In accordance with ASC 825-10, as a result of the classification of the warrants as derivative liabilities, the Company expensed a portion of the offering costs originally recorded as a reduction in equity. The portion of offering costs that was expensed was determined based on the relative fair value of the Public Warrantsextent available), accumulated deficit and Class A ordinary shares. 

In connection with the change in presentation for the Class A ordinary shares includedsubject to redemption, the Company also restated its income (loss) per ordinary share calculation to allocate net income (loss) pro rata to Class A and Class B ordinary shares. This presentation contemplates a Business Combination as the most likely outcome, in which case, both classes of ordinary share pro rata in the Units.

As a resultincome (loss) of the above, the Company should have classified the Warrants as derivative liabilities in its previously issued financial statement as of March 4, 2021. Under this accounting treatment, the Company is required to measure the fair value of the Warrants at the end of each reporting period as well as re-evaluate the treatment of the warrants and recognize changes in the fair value from the prior periodCompany.

There has been no change in the Company’s total assets, liabilities or operating results forresults.
The impact of the current period.

The Company’s accounting for the Warrants as components of equity instead of as derivative liabilities did not have any effectrestatement on the Company’s previously reported investments heldfinancial statements is reflected in trust or cash.

   As         
   Previously       As 
   Reported   Adjustments   Revised 

Balance sheet as of March 4, 2021 (audited)

      

Warrant Liabilities

  $—     $15,840,000   $15,840,000 

Total liabilities

   10,988,357    15,840,000    26,828,357 

Class A Ordinary Shares Subject to Possible Redemption

   287,038,440    (15,840,000)    271,198,440 

Class A Ordinary Shares

   130    158    288 

Additional Paid-in Capital

   5,004,010    586,181    5,590,191 

Accumulated Deficit

   (5,000)    (586,339)    (591,339) 
the following tables:
   
As Previously
Reported
   
Adjustment
   
As Restated
 
Condensed
Balance Sheet as of March 31, 2021 (unaudited)
               
Class A ordinary shares subject to possible redemption
  $279,064,100   $30,386,620   $309,450,720 
Class A ordinary shares
  $304   $(304)  $0   
Additional paid-in capital
  $6,407,837   $(6,407,837)  $0   
Accumulated deficit
  $(1,408,996)  $(23,978,479)  $(25,387,475)
Total Shareholders’ Equity (Deficit)
  $5,000,008   $(30,386,620)  $(25,386,612)
Number of shares subject to redemption
   27,906,410    3,038,662    30,945,072 
Condensed
Balance Sheet as of June 30, 2021 (unaudited)
               
Class A ordinary shares subject to possible redemption
  $278,414,660   $31,036,030   $309,450,720 
Class A ordinary shares
  $311   $(311)  $0   
Additional paid-in capital
  $7,057,359   $(7,057,359)  $0   
Accumulated deficit
  $(2,058,442)  $(23,978,390)  $(26,036,832)
Total Shareholders’ Equity (Deficit)
  $5,000,002   $(31,036,030)  $(26,036,058)
Number of shares subject to redemption
   27,841,466    3,103,606    30,945,072 
Condensed Statement of Operations
for the
three months ended
March
 3
1
, 2021 (unaudited)
               
Weighted average shares outstanding, Class A ordinary shares
   30,945,072    (21,661,550)   9,283,522 
Basic and diluted loss income per share, Class A ordinary shares
  $0     $(0.08)   $(0.08) 
Weighted average shares outstanding, Class B ordinary shares
   7,570,880    0      7,570,880 
Basic and diluted net loss per share, Class B ordinary shares
  $(0.19)   $0.11   $(0.08) 
Condensed Statement of Operations for
the
three months ended June
 3
0
, 2021 (
un
audited)
               
Weighted average shares outstanding, Class A ordinary shares
   30,945,072    0      30,945,072 
Basic and diluted net loss per share, Class A ordinary shares
  $0     $(0.02)   $(0.02) 
Weighted average shares outstanding, Class B ordinary shares
   7,736,268    0      7,736,268 
Basic and diluted net loss per share, Class B ordinary shares
  $(0.08)   $0.06   $(0.02) 
Condensed Statement of Operations
for the
six months ended June
 3
0
, 2021 (
un
audited)
               
Weighted average shares outstanding, Class A ordinary shares
   30,945,072    (10,770,937)    20,174,135 
Basic and diluted net loss per share, Class A ordinary shares
  $0     $(0.07)   $(0.07) 
Weighted average shares outstanding, Class B ordinary shares
   7,654,031    0      7,654,031 
Basic and diluted net loss per share, Class B ordinary shares
  $(0.27)   $0.20   $(0.07) 
Statement of Cash Flows for the
three months ended
March 31, 2021
(unaudited)
               
Non-Cash Investing and Financing Activities
               
Initial classification of Class A ordinary shares subject to possible redemption
  $271,198,440   $(271,198,440)  $0   
Change in value of Class A ordinary shares subject to possible redemption
  $7,865,660   $(7,865,660)   $0   
Statement of Cash Flows for the
six months ended
June 30, 2021
(
un
audited)
               
Non-Cash Investing and Financing Activities
               
Initial classification of Class A ordinary shares subject to possible redemption
  $271,198,440   $(271,198,440)  $0   
Change in value of Class A ordinary shares subject to possible redemption
  $7,216,220   $(7,216,200)   $0   

NOTE 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form
10-Q
and Article 8 of Regulation
S-X
of the SEC. Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented.

The accompanying unaudited condensed financial statements should be read in conjunction with the Company’s prospectus for its Initial Public Offering as filed with the SEC on March 2, 2021. The interim results for the three and nine months ended March 31,September 30, 2021, are not necessarily indicative of the results to be expected for the year ending December 31, 2021 or for any future periods.

2021.

Emerging Growth Company

The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.

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DHC ACQUISITION CORP.

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

MARCH 31,

SEPTEMBER 30, 2021

(Unaudited)

(AS RESTATED)
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to
non-emerging
growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statement with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

Use of Estimates

The preparation of the unaudited condensed financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimateesti
m
ate 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. One of the more significant accounting estimates included in these financial statements is the determination of the fair value of the warrant liability. Accordingly,Such estimates may be subject to change as more current information becomes available and, accordingly, the actual results could differ significantly from those estimates.

Cash and Cash Equivalents

The Company considers all short-term investments with an original maturity of three and nine months or less when purchased to be cash equivalents. The Company did not0t have any cash equivalents as of March 31,September 30, 2021 and December 31, 2020.

Cash

Investment Held in Trust Account

At March 31,September 30, 2021, substantially all of the assets held in the Trust Account were held in cash.

a checking account held by Continental Stock Transfer & Trust Company.

Offering Costs

Offering costs consistconsisted of legal, accounting underwriting fees and other costsexpenses incurred through the balance sheet dateInitial Public Offering that arewere directly related to the Initial Public Offering. Offering costs amountingwere allocated to $16,915,007the separable financial instruments issued in the Initial Public Offering based on a relative fair value basis, compared to total proceeds received. Offering costs allocated to warrant liabilities were expensed as incurred in the statements of operations. Offering costs associated with the Class A ordinary shares issued were initially charged to temporary equity and then accreted to ordinary shares subject to redemption upon the completion of the Initial Public Offering. Offering costs amounted to $17,501,346, of which $16,915,008 were charged to shareholders’ equity upon the completion of the Initial Public Offering and $586,339 of the offering costs were allocated to the warrant liabilities and chargedexpensed to the statement of operations.

Class A Ordinary Shares Subject to Possible Redemption

The Company accounts for its Class A ordinary shares subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Class A ordinary shares subject to mandatory redemption, if any, are classified as a liability instrument and are measured at fair value. Conditionally redeemable Class A ordinary shares (including Class A ordinary shares that features 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, Class A ordinary shares are classified as shareholders’ equity. The Company’s Class A ordinary shares feature certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at March 31,September 30, 2021 27,906,410
, 30,945,072 Class A ordinary shares subject to possible redemption are presented as temporary equity, outside of the shareholders’ equity section of the Company’s balance sheets, respectively.

Under ASC 480-10-S99, the Company elected to recognize changes in redemption value immediately as they occur and adjusts the carrying value of redeemable ordinary shares 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 value. The change in the carrying value of redeemable Class A ordinary shares resulted in charges against additional
paid-in
capital and accumulated deficit.
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DHC ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(AS RESTATED)
At September 30, 2021, the Class A ordinary shares reflected in the condensed balance sheets are reconciled in the following table:
Gross proceeds
  $309,450,720 
Less:
     
Proceeds allocated to Public Warrants
  $(10,211,874) 
Class A ordinary shares issuance costs
  $(16,924,264) 
Plus:
     
Accretion of carrying value to redemption value
  $27,136,138 
   
 
 
 
Class A ordinary shares subject to possible redemption
  $309,450,720 
   
 
 
 
Warrant Liabilities

The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480 and FASB ASC Topic 815, “Derivatives and Hedging” (“ASC 815”). The Company accounts for the Warrants in accordance with the guidance contained in ASC 815-40
ASC815-40
under which the Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the Warrants as liabilities at their fair value and adjust the Warrants to fair value at each reporting period. This liability is subject to re-measurement at each balance sheetsheets date until exercised, and any change in fair value is recognized in our statementstatements of operations. The Private Placement Warrants and the Public Warrants for periods where no observable traded price was available are valued using a Monte Carlo simulation. For periods subsequent to the detachment of the Public Warrants from the Units, the Public Warrant quoted market price will beusedbe used as the fair value as of each relevant date.

DHC ACQUISITION CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS

MARCH 31, 2021

(Unaudited)

Income Taxes

The Company accounts for income taxes under ASC Topic 740, “Income Taxes,” which 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’s management determined that the Cayman Islands is the Company’s major tax jurisdiction. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. As of March 31,September 30, 2021 and December 31, 2020, there were no0 unrecognized tax benefits and no0 amounts accrued for interest and penalties. 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’s management does not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months.

The Company is considered to be an exempted Cayman Islands company with no connection to any other taxable jurisdiction and is presently not subject to income taxes or income tax filing requirements in the Cayman Islands or the United States. As such, the Company’s tax provision was zero0 for the period presented.

Net LossIncome (Loss) per Ordinary Share

The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share”. Net lossincome (loss) per ordinary share is computed by dividing net income (loss) by the weighted average number of ordinary shares outstanding for the period. The Company applies the
two-class
method in calculating income (loss) per ordinary share. Accretion associated with the redeemable shares of Class A ordinary share is excluded from income (loss) per ordinary share as the redemption value approximates fair value.
The calculation of diluted income (loss) per ordinary share does not consider the effect of the warrants issued in connection with the (i) Initial Public Offering, and (ii) the exercise of the over-allotment option and (iii) Private Placement Warrantsprivate placement since the exercise of the warrants is contingent upon the occurrence of future eventsevents. The warrants are exercisable to purchase 16,441,034 shares of Class A ordinary share in the aggregate. As of September 30, 2021 and 2020, the inclusionCompany did 0t have any dilutive securities or other contracts that could, potentially, be exercised or converted into ordinary shares and then share in the earnings of such warrants would be anti-dilutive.

The Company’s statement of operations includesthe Company. As a presentation ofresult, diluted net income (loss) per ordinary share for ordinary shares subject to possible redemption in a manner similar tois the two-class method ofsame as basic net income (loss) per share. Net income per ordinary share basic and diluted, for Class A redeemable ordinary shares is calculated by dividing the interest income earned on the Trust Account, by the weighted average number of Class A redeemable ordinary shares outstanding since original issuance. Net loss per share, basic and diluted, for Class B non-redeemable ordinary shares is calculated by dividing the net loss, adjusted for income attributable to Class A redeemable ordinary shares, by the weighted average number of Class B non-redeemable ordinary shares outstanding for the period. Class B non-redeemable ordinary shares includes the Founder Shares as these shares do not have any redemption features and do not participate in the income earned on the Trust Account.

periods presented.

9
Table of Contents
DHC ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(AS RESTATED)
The following table reflects the calculation of basic and diluted net income (loss) per ordinary share (in dollars, except per share amounts):

   

Three Months

Ended

March 31,

 
   2021 

Redeemable Class A Ordinary Shares

  

Numerator: Earnings allocable to Redeemable Class A Ordinary Shares

  

Interest Income

  $—   
  

 

 

 

Net Earnings

  $—   

Denominator: Weighted Average Redeemable Class A Ordinary Shares

  

Redeemable Class A Ordinary Shares, Basic and Diluted

   30,945,072 

Earnings/Basic and Diluted Redeemable Class A Ordinary Shares

  $—   

Non-Redeemable Class B Ordinary Shares

  

Numerator: Net Loss minus Redeemable Net Earnings

  

Net Loss

  $(1,393,996) 
  

 

 

 

Non-Redeemable Net Loss

  $(1,393,996) 

Denominator: Weighted Average Non-Redeemable Class B Ordinary Shares

  

Non-Redeemable Class B Ordinary Shares, Basic and Diluted (1)

   7,570,880 

Loss/Basic and Diluted Non-Redeemable Class B Ordinary Shares

  $(0.18) 

Note: As of March 31, 2021, basic and diluted shares are the same as there are no non-redeemable securities that are dilutive to the Company’s shareholders.

   
Three Months
Ended
September 30,
2021

Class A
   
Nine Months
Ended
September 30,
2021

Class A
 
Basic and Diluted net income per ordinary share
  
Numerator:
    
Allocation of net income, as adjusted
  $3,818,494   $2,058,448 
Denominator:
    
Basic and diluted weighted average ordinary shares outstanding
   30,945,072    23,913,792 
Basic and diluted net income per ordinary share
   0.12    0.09 
   
Three
 
Months
Ended
September
 
30,
2021

Class B
   
Nine Months
Ended
September
 
30,
2021

Class B
 
Basic net income per ordinary share
     
Numerator:
          
Allocation of net income, as adjusted
  $954,624   $661,228 
Denominator:
          
Basic weighted average ordinary shares outstanding
   7,736,268    7,681,745 
Basic net income per ordinary share
   0.12    0.09 
Diluted net income per ordinary share
     
Numerator:
          
Allocation of net income, as adjusted
  $954,624   $664,774 
Denominator:
          
Diluted weighted average ordinary shares outstanding
   7,736,268    7,736,268 
Diluted net income per ordinary share
   0.12    0.09 
Concentration of Credit Risk

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

DHC ACQUISITION CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS

MARCH 31, 2021

(Unaudited)

Fair Value of Financial Instruments

The fair value of the Company’s assets and liabilities which qualify as financial instruments under ASC TopicT
o
pic 820, “Fair Value Measurement,” approximatesapproximate the carrying amounts represented in the accompanying condensed balance sheets, primarily due to their short-term nature, except for the Warrantwarrant liabilities (see Note 10)
9
).

Recent Accounting Standards

In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update
(“ASU”)
2020-06,
Debt — Debt with Conversion and Other Options (Subtopic
470-20)
and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic
815-40) (“
(“ASU
2020-06”)
to simplify accounting for certain financial instruments. ASU
2020-06
eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU
2020-06
amends the diluted earnings per share guidance, including the requirement to use the
if-converted
method for all convertible instruments. ASU
2020-06
is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company is currently assessing the impact, if any, that ASU
2020-06
would have on its financial position, results of operations or cash flows.

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

NOTE 4. PUBLIC OFFERING

Pursuant to the Initial Public Offering, the Company sold 30,000,000 Units, at a price of $10.00 per Unit. Each Unit consists of one Class A ordinary share and
one-third
of one redeemable warrant (“Public Warrant”). Each whole Public Warrant entitles the holder to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment (see Note 9). On March 5, 2021, the underwriters partially exercised their over-allotment option, resulting in an additional 945,072 Units issued for an aggregate amount of $9,450,720.

NOTE 5. PRIVATE PLACEMENT

Simultaneously with the closing of the Initial Public Offering, the Sponsor purchased 6,000,000 Private Placement Warrants at a price of $1.50 per Private Placement Warrant, for an aggregate purchase price of $9,000,000.$9,000,000
. The Sponsor has agreed to purchase up to an
 additional 600,000 Private Placement Warrants, for an aggregate purchase price of an additional $900,000
, if the over-allotment option is exercised in full in part by the underwriters. On March 5, the Sponsor
purchased 126,010 Private Placement Warrants for an additional aggregate purchase price of $189,015 in connection with the partial exercise of the underwriter’s over-allotment option. Each Private Placement Warrant is exercisable to purchase one1 Class A ordinary share at a price of $11.50 per share, subject to adjustment (see Note 7)9). A portion of the proceeds from the Private Placement Warrants were 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 proceeds from the sale of the Private Placement Warrants will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law), and the Private Placement Warrants will expire worthless.

10
Table of Contents
DHC ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(AS RESTATED)

NOTE 6. RELATED PARTY TRANSACTIONS

Founder Shares

In December 2020, the Sponsor paid $25,000 to cover certain expenses on behalf of the Company in consideration for 7,187,500 Class B ordinary shares (the “Founder Shares”). On March 1, 2021, the Company effected a share capitalization, pursuant to which an additional 1,437,500 Class B ordinary shares were issued, resulting in an aggregate of 8,625,000
 Founder Shares outstanding. At March 31, 2021, theThe Founder Shares included an aggregate of up to 888,7321,125,000 shares that were subject to forfeiture by the Sponsor following to the extent the underwriters’ election to partially exercise their over-allotment option was not exercised so that the number of Founder Shares collectively represented 20% of the Company’s issued and outstanding shares upon the completion of the Initial Public Offering (assuming the Sponsor does not purchase any Public Shares in the Initial Public Offering). As a result of the underwriters’ remaining over-allotmentnot exercising their overallotment option expiring subsequent to March 31, 2021,in full, 888,732 Founder Shares were forfeited.

forfeited on March 4, 2021.
The Sponsor has agreed, not to transfer, assign or sell any Founder Shares until the earlier to occur of (i) one year after the completion of the Company’s Business Combination and (ii) subsequent to a Business Combination, (x) if the closing price of the Company’s Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share subdivisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any
30-trading
day period commencing at least 150 days after the Company’s Business Combination or (y) the date on which the Company completes a liquidation, merger, share exchange, or other similar transaction that results in all of the Company’s public shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property.

DHC ACQUISITION CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS

MARCH 31, 2021

(Unaudited)

Administrative Services Agreement

The Company entered into an agreement, commencing on March 4, 2021, through the earlier of the Company’s consummation of a Business Combination and its liquidation, to pay an affiliate of the Sponsor a total of $10,000 per month for office space, secretarial and administrative services. As of March 31,For the three and nine months ended September 30, 2021, the total expense for administrative services was $10,000$30,000 and was$70,000, respectively and $70,000 is included in accrued expenses on the condensed balance sheet as of March 31,September 30, 2021.

Promissory Note — Related Party

On December 29, 2020, the Sponsor issued an unsecured promissory note to the Company (the “Promissory Note”), pursuant to which the Company could borrow up to an aggregate principal amount of $300,000. The Promissory Note was
non-interest
bearing and payable on the earlier of (i) July 31, 2021 or (ii) the completion of the Initial Public Offering. The outstanding amount of $171,357 was repaid after the closing of the Initial Public Offering on March 9, 2021.

Borrowings under the Promissory Note are no longer available.

Advances from Related Party
As of September 30, 2021, the Sponsor paid $123,780 on behalf of the Company in connection with certain offering and operating costs. The advances are
non-interest
bearing.
Related Party Loans

In order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (the “Working Capital Loans”). If the Company completes a Business Combination, the Company may repay the Working Capital Loans. Otherwise, the Working Capital Loans may be repaid only out of funds held outside the Trust Account. The Working Capital Loans would either be repaid upon consummation of a Business Combination or, at the lender’s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into warrants of the post- Business Combination entity at a price of $1.50 per warrant. Such 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 March 31,September 30, 2021 and December 31, 2020, there were no amounts outstanding under the Working Capital Loans.

0 working capital loans outstanding.

NOTE 7. COMMITMENTS

Risks and Uncertainties

Management continues to evaluate the impact of the
COVID-19
pandemic and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s financial position, results of its operations and/or search for a target company, the specific impact is not readily determinable as of the date of these financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

11
Table of Contents
DHC ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(AS RESTATED)
Registration Rights

Pursuance to a registration rights agreement entered into on March 4, 2021, the holders of the Founder Shares, Private Placement Warrants and any warrants that may be issued upon conversion of Working Capital Loans (and any Class A ordinary shares issuable upon the exercise of the Private Placement Warrants or warrants issued upon conversion of the Working Capital Loans) will be entitled to registration rights pursuant to a registration rights agreement to be signed prior to or on the effective date of the Initial Public Offering. 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 a Business Combination. However, the registration and shareholder rights agreement providesprovide that the Company will not permit any registration statement filed under the Securities Act to become effective until termination of the applicable lockup period, which occurs (i) in the case of the Founder Shares, and (ii) in the case of the Private Placement Warrants and the respective Class A ordinary shares underlying such warrants, 30 days after the completion of the Business Combination. The registration rights agreement does not contain liquidated damages or other cash settlement provisions resulting from delays in registering the Company’s securities. The Company will bear the expenses incurred in connection with the filing of any such registration statements.

Underwriting Agreement

The Company granted the underwriters a
45-day
option from the date of the Initial Public Offering to purchase up to 4,500,000 additional Units to cover over-allotments, if any, at the Initial Public Offering price less the underwriting discounts and commissions. On March 5, 2021, the underwriters elected to partially exercise their over-allotment option to purchase an additional 945,072 Units and their option to purchase an additional 3,554,928 Units expired.

The underwriters are entitled to a deferred fee of $0.35 per Unit, or $10,830,775 in the aggregate. The deferreddef
e
rred 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.

NOTE 8. STOCKHOLDERS’SHAREHOLDERS’ EQUITY

Preference Shares
—
The Company is authorized to issue 5,000,000 preference shares with a par value of $0.0001 per share, with such designations, voting and other rights and preferences as may be determined from time to time by the Company’s board of directors. At March 31,September 30, 2021 and December 31, 2020, there were no0 preference shares issued or outstanding.

Class
 A Ordinary Shares
— The Company is authorized to issue 500,000,000 shares of Class A ordinary shares with a par value of $0.0001 per share. Holders of the Company’s Class A ordinary shares are entitled to one vote for each share. At March 31,September 30, 2021 there were 3,038,662 Class A ordinary30,945,072 shares issued and outstanding, excluding 27,906,410of Class A ordinary shares subject to possible redemption. At December 31, 2020, there were no redemption, which are presented as temporary equity.
Class A ordinary shares issued or outstanding.

DHC ACQUISITION CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS

MARCH 31, 2021

(Unaudited)

Class

 B Ordinary Shares
— The Company is authorized to issue 50,000,000 Class B ordinary shares with a par value of $0.0001 per share. Holders of Class B ordinary shares are entitled to one vote for each share. At March 31,September 30, 2021 and December 31, 2020, there were 7,736,268 and 8,625,000 shares of Class B ordinary shares issued and outstanding.

outstanding, respectively.
Holders of Class A ordinary shares and Class B ordinary shares will vote together as a single class on all other matters submitted to a vote of shareholders, except as required by law; provided that only holders of Class B ordinary shares have the right to vote on the appointment of directors prior to the Company’s initial Business Combination.

The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of a Business Combination on a

one-for-one
basis, subject to adjustment. In the case that additional Class A ordinary shares, or equity-linked securities, are issued or deemed issued in excess of the amounts sold in the Initial Public Offering and related to the closing of a Business Combination, the ratio at which Class B ordinary shares shall convert into Class A ordinary shares will be adjusted (unless the holders of a majority of the issued and outstanding Class B ordinary shares agree to waive such anti-dilution adjustment with respect to any such issuance or deemed issuance) so that the number of Class A ordinary shares issuable upon conversion of all Class B ordinary shares will equal, in the aggregate, 20% of the sum of all ordinary shares issued and outstanding upon completion of the Initial Public Offering plus all Class A ordinary shares and equity-linked securities issued or deemed issued in connection with the Business Combination (excluding any shares or equity-linked securities issued, or to be issued, to any seller in the Business Combination and any private placement-equivalent warrants issued to the Sponsor or its affiliates upon conversion of loans made to the Company).

12
Table of Contents
DHC ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(AS RESTATED)
NOTE 9. WARRANTS

WARRANT LIABILITIES

As of March 31,September 30, 2021, there were 10,315,024 Public Warrants outstanding. As of December 31, 2020 there were no0 Public Warrants outstanding. Public Warrants may only be exercised for a whole number of shares. No fractional warrants will be issued upon separation of the Units and only whole warrants will trade. The Public Warrants will become exercisable on the later of (a) one year from the closing of the Initial Public Offering and (b) 30 days after the completion of a Business Combination. The Public Warrants will expire five years after the completion of a Business Combination or earlier upon redemption or liquidation.

The Company will not be obligated to deliver any Class A ordinary shares pursuant to the exercise of a Public Warrant and will have no obligation to settle such Public Warrant exercise unless a registration statement under the Securities Act covering the issuance of the Class A ordinary shares underlying the Public Warrants is then effective and a prospectus relating thereto is current, subject to the Company satisfying its obligations with respect to registration, or a valid exemption from registration is available. No Public Warrant will be exercisable for cash or on a cashless basis, and the Company will not be obligated to issue any shares to holders seeking to exercise their warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption is available.

The Company has agreed that as soon as practicable, but in no event later than twenty business days after the closing of the Company’s Business Combination, the Company will use its commercially reasonable efforts to file with the SEC a registration statement for the registration, under the Securities Act, of the Class A ordinary shares issuable upon exercise of the warrants, and the Company will use its commercially reasonable efforts to cause the same to become effective within 60 business days after the closing of a Business Combination, and to maintain the effectiveness of such registration statement and a current prospectus relating to those Class A ordinary shares until the warrants expire or are redeemed, as specified in the warrant agreement; provided that the Class A ordinary shares are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of public warrants who exercise their warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event the Company so elects, the Company will not be required to file or maintain in effect a registration statement, but will use its commercially reasonably efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available.

Once the warrants become exercisable, the Company may redeem the Public Warrants for redemption (Redemption of warrants when the price per Class A ordinary share equals or exceeds $18.00):

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 to each warrant holder; and

if, and only if, the closing price of the Class A ordinary shares equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant) for any 20 trading days within a
30-trading
day period ending three trading days before the Company sends the notice of redemption to the warrant holders.

The Company will not redeem the warrants unless a registration statement under the Securities Act covering the issuance of the Class A ordinary shares issuable upon exercise of the warrants is then effective and a current prospectus relating to those Class A ordinary shares is available throughout the
30-day
redemption period. If and when the warrants become redeemable the Company may exercise its redemption right even if the Company is unable to register or qualify the underlying securities for sale under all applicable state securities laws.

DHC ACQUISITION CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS

MARCH 31, 2021

(Unaudited)

Redemption
 of warrants when the price per Class
 A ordinary share 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 on a cashless basis prior to redemption and receive that number of shares determined based on the redemption date and the “fair market value” of the Class A ordinary shares;

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 on a cashless basis prior to redemption and receive that number of shares determined based on the redemption date and the “fair market value” of the Class A ordinary shares;
if, and only if, the closing price of the Class A ordinary shares equals or exceeds $10.00 per public share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant) for any 20 trading days within the
30-trading
day period ending three trading days before the Company send the notice of redemption to the warrant holders; and

if the closing price of the Class A ordinary shares for any 20 trading days within a
30-trading
day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders is less than $18.00 per share, the Private Placement Warrants must also be concurrently called for redemption on the same terms as the outstanding public warrants.

In addition, if (x) the Company issue additional Class A ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of a Business Combination at an issue price or effective issue price of less than $9.20 per ordinary 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 a Business Combination (net of redemptions), and (z) the volume weighted average trading price of the Class A ordinary shares during the 20 trading day period starting on the trading day prior to the day on which we consummate our 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, the $18.00 per share redemption trigger price 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 price will be adjusted (to the nearest cent) to be equal to the higher of the Market Value and the Newly Issued Price.

As of March 31,September 30, 2021, there were 6,126,010 Private Placement Warrants outstanding. As of December 31, 2020 there were no0 Private Placement Warrants outstanding. The Private Placement Warrants will be identical to the Public Warrants underlying the Units being sold in the Initial Public Offering, except that (x) the Private Placement Warrants and the Class A ordinary shares issuable upon the exercise of the Private Placement Warrants will not be transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and be
non-redeemable
as described above so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants.

NOTE 10. FAIR VALUE MEASUREMENTS

The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:

Level 1:  Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.
Level 2:  Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active.
Level 3:  Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability.

At March 31,September 30, 2021, assets held in the Trust Account were comprised of $309,450,720
in cash.a checking account held by Continental Stock Transfer and Trust Company. At December 31, 2020 there
were no assets0assets held in the Trust Account. During the three and nine months ended March 31,September 30, 2021, the Company did not withdraw any interest income from the Trust Account.

The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at March 31,September 30, 2021, and December 31, 2020, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:

Description

  Level   March 31,
2021		   December 31,
2020		 

Liabilities:

      

Warrant Liability – Public Warrants

   3   $10,624,475   $—   

Warrant Liability – Private Placement Warrants

   3   $6,309,790   $—   

Description  
Level
   
September 30,

2021
 
Liabilities:
          
Warrant Liability – Public Warrants
   1   $7,220,517 
Warrant Liability – Private Placement Warrants
   2   $4,288,207 
13
Table of Contents
DHC ACQUISITION CORP.

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

MARCH 31,

SEPTEMBER 30, 2021

(Unaudited)

(AS RESTATED)
The Warrants were accounted for as liabilities in accordance with ASC
815-40
and are presented within warrant liabilities on our accompanying March 31,September 30, 2021 unaudited condensed balance sheet.sheets. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value of warrant liabilities in the condensed statementstatements of operations.

Initial Measurement

operations

.
The Company established the initial fair valuevalu
e
 for the Warrants on March 4, 2021, the date of the Company’s Initial Public Offering, using a Monte Carlo Simulation for the Private Placement Warrants and the Public Warrants. The Company allocatedsubsequent measurements of the proceeds receivedPublic Warrants after the detachment of the Public Warrants from (i) the sale of Units (which is inclusive of one share of Class A ordinary shares and one-half of one Public Warrant), (ii) the sale of Private Placement Warrants, and (iii) the issuance of Class B ordinary shares, first to the Warrants based on their fair values as determined at initial measurement, with the remaining proceeds allocated to Class A ordinary shares subject to possible redemption, Class A ordinary shares and Class B ordinary shares based on their relative fair values at the initial measurement date. The Warrants were classified as Level 3 at the initial measurement date1 due to the use of unobservable inputs.

The key inputs intoan observable market quote in an active market under the Monte Carlo simulation model for the Private Placement Warrants and Public Warrants were as follows at initial measurement:

Input

  March 4, 2021
(Initial
Measurement and Over-
allotment)		 

Risk-free interest rate

   1.03% 

Expected Term (Years)

   5.0 

Expected volatility

   25.0% 

Exercise price

  $11.50 

Unit Price

  $9.67 

On March 4, 2021, inclusive of over-allotment, the Private Placement Warrants and Public Warrants were determined to be $0.99 per warrant for aggregate values of $6.06 million and $10.21 million, respectively.

Subsequent Measurement

The Warrants are measured at fair value on a recurring basis.ticker DHCAW. The subsequent measurement of the Public Warrants and the Private Placement Warrants was calculated using a Monte Carlo Simulation which is considered a Level 3 measurement.

The key inputs into the Monte Carlo Simulationsimulation model for the Public and Private PlacementLevel 3 Warrants were as follows at March 31, 2021:

Input

    

Risk-free interest rate

   1.38% 

Expected Term (Years)

   5.0 

Expected volatility

   25.0% 

Exercise price

  $11.50 

Unit Price

  $9.65 

As of March 31, 2021, the aggregate values of the Private Placement Warrants and Public Warrants were determined to be $1.03 per warrant for aggregate values of $6.31 million and $10.62 million, respectively.

follows:

Input  September 30,
2021		 
Risk-free interest rate
   1.13% 
Expected Term (Years)
   5.0 
Expected volatility
   12% 
Exercise price
  $11.50 
Unit Price
  $9.77 
The following table presents the changes in the fair value of Level 3 warrant liabilities:

   Private Placement   Public   Warrant Liabilities 

Fair value as of January 1, 2021

  $—     $—     $—   

Initial measurement on March 4, 2021 (IPO)

   5,940,000    9,900,000    15,840,000 

Initial measurement on March 5, 2021 (Over allotment)

   124,750    311,874    436,624 

Change in fair value

   245,040    412,601    657,641 
  

 

 

   

 

 

   

 

 

 
  

 

 

   

 

 

   

 

 

 

Fair value as of March 31, 2021

  $6,309,790   $10,624,475   $16,934,265 
  

 

 

   

 

 

   

 

 

 

   Private Placement   Public   Warrant Liabilities 
Fair value as of January 1, 2021
  $0—     $0—     $0—   
Initial measurement on March 4, 2021 (IPO)
   5,940,000    9,900,000    15,840,000 
Initial measurement on March 5, 2021 (Over allotment)
   124,750    311,874    436,624 
Change in fair value
   245,040    412,621    657,641 
   
 
 
   
 
 
   
 
 
 
Fair value as of March 31, 2021
  $6,309,790   $10,624,475   $16,934,265 
Change in fair value
   —      (103,151)    (103,151) 
Transfer to Level 1
   —      (10,521,324)    (10,521,324) 
   
 
 
   
 
 
   
 
 
 
Fair value as of June 30, 2021
  $6,309,790   $—     $6,309,790 
Change in fair value
   (2,021,583)    0      (2,021,583) 
Transfer to Level 2
  
(4,288,207
)		  
—
   
(4,288,207
)
   
 
 
   
 
 
   
 
 
 
Fair value as of September 30, 2021
  $0   $0     $0 
   
 
 
   
 
 
   
 
 
 
Transfers to/from Levels 1, 2 and 3 are recognized at the end of the reporting period in which a change in valuation technique or methodology occurs. The estimated fair value of the Public Warrants transferred from a Level 3 measurement to a Level 1 fair value measurement during the nine months ended September 30, 2021 was $10,521,324
. There were transfers of $4,288,207 from Level 3 to Level 2 during the three and nine months ended September 30, 2021.
14
Table of Contents
DHC ACQUISITION CORP.

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

MARCH 31,

SEPTEMBER 30, 2021

(Unaudited)

(AS RESTATED)

NOTE 11. SUBSEQUENT EVENTS

The Company evaluated subsequent events and transactions that occurred after the balance sheetsheets date up to the date that the unaudited condensed financial statements were issued. Based upon this review, the Company did not identify any subsequent events that would have required adjustment or disclosure in the condensed financial statements.

statements, except for the restatement discussed in Note 2.

15
Table of Contents

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

References in this amended report (the “Quarterly Report”) to “we,” “us” or the “Company” refer to DHC Acquisition Corp. References to our “management” or our “management team” refer to our officers and directors, and references to the “Sponsor” refer to DHC Sponsor, LLC. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.

Special Note Regarding Forward-Looking Statements

This Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact included in this Form 10-QQuarterly Report including, without limitation, statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the completion of the Proposed Business Combination (as defined below), the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements, including that the conditions of the Proposed Business Combination are not satisfied. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors section of the Company’s final prospectus for its Initial Public Offering filed with the U.S. Securities and Exchange Commission (the “SEC”).SEC. The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

This Management’s Discussion and Analysis of Financial Condition and Results of Operations has been amended and restated to give effect to the restatement of our financial statements as of March 31, 2021 and June 30, 2021. Management identified errors made in its historical financial statements where, at the closing of our Initial Public Offering, we improperly valued our Class A ordinary shares subject to possible redemption. We previously determined the Class A ordinary shares subject to possible redemption to be equal to the redemption value of $10.00 per Class A ordinary share while also taking into consideration a redemption cannot result in net tangible assets being less than $5,000,001. Management determined that the Class A ordinary shares issued during the Initial Public Offering can be redeemed or become redeemable subject to the occurrence of future events considered outside of the Company’s control. Therefore, management concluded that the redemption value should include all Class A ordinary shares subject to possible redemption, resulting in the Class A ordinary shares subject to possible redemption being equal to their redemption value. As a result, management has noted a reclassification error related to temporary equity and permanent equity. This resulted in a restatement to the initial carrying value of the Class A ordinary shares subject to possible redemption with the offset recorded to additional paid-in capital (to the extent available), accumulated deficit and Class A ordinary shares.
Overview

We are a blank check company incorporated in the Cayman Islands on December 22, 2020 formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities. We intend to effectuate our Business Combination using cash derived from the proceeds of the Initial Public Offering and the sale of the Private Placement Warrants, our shares, debt or a combination of cash, shares and debt.

We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete a Business Combination will be successful.

Results of Operations

We have neither engaged in any operations nor generated any revenues to date. Our only activities through March 31,September 30, 2021 were organizational activities, those necessary to prepare for the Initial Public Offering, described below, and identifying a target company for a Business Combination. We do not expect to generate any operating revenues until after the completion of our Business Combination. We generate
non-operating
income in the form of interest income on marketable securities held in the Trust Account. We incur 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 three months ended March 31,September 30, 2021, we had a net lossincome of $1,393,996,$4,773,118, which consists of operating costs of $150,016,549,272 and a change in fair value of warrant liability of $657,641$5,322,390.
For the nine months ended September 30, 2021, we had a net income of $2,719,696, which consists of operating costs of $1,461,885, change in fair value of warrant liability of $4,767,900 and transaction costs allocated to warrant liabilities of $586,339.

Liquidity and Capital Resources

On March 4, 2021, we consummated the Initial Public Offering of 30,000,000 Units at $10.00 per Unit, generating gross proceeds of $300,000,000. Simultaneously with the closing of the Initial Public Offering, we consummated the sale of 6,000,000 Private Placement Warrants at a price of $1.50 per Private Placement Warrant in a private placement to the Sponsor, generating gross proceeds of $9,000,000.

On March 5, 2021, in connection with the underwriters’ partial exercise of their over-allotment option, in full, we consummated the sale of an additional 945,072 Units at a price of $10.00 per Unit, generating total gross proceeds of $9,450,720. In addition, we also consummated the sale of an additional 126,010 Private Placement Warrants at $1.50 per Private Warrant, generating total gross proceeds of $189,015.

Following the Initial Public Offering, the partial exercise of the over-allotment option, and the sale of the Private Placement Warrants, a total of $309,450,720 was placed in the Trust Account. We incurred $17,501,346 in Initial Public Offering related costs, including $6,189,014 of underwriting fees, $10,830,775 of deferred underwriting fees and $481,557 of other costs.

For the threenine months ended March 31,September 30, 2021, cash used in operating activities was $954,856.$1,655,485. Net lossincome of $1,403,996$2,719,676 was affected by change in fair value of warrant liability of $657,641$4,767,900 and transaction costs allocated to warrant liabilities of $586,339. Changes in operating assets and liabilities used $804,840$193,600 of cash for operating activities.

As of March 31,September 30, 2021, we had cash held in the Trust Account of $309,450,720. We may withdraw interest from the Trust Account to pay taxes, if any. We intend to use substantially all of the funds held in the Trust Account, including any amounts representing interest earned on the Trust Account (less income taxes payable), to complete our Business Combination. To the extent that our share capital or debt is used, in whole or in part, as consideration to complete our Business Combination, the remaining proceeds held in the Trust Account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.

16
Table of Contents
As of March 31,September 30, 2021, we had cash of $1,573,788.$979,939. We intend to use the funds held outside the Trust Account primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, and structure, negotiate and complete a Business Combination.

In order to fund working capital deficiencies or finance transaction costs in connection with a Business Combination, the Sponsor, or certain of our officers and directors or their affiliates may, but are not obligated to, loan us funds as may be required. If we complete a Business Combination, we wouldwill repay such loaned amounts. In the event that a Business Combination does not close, we may use a portion of the working capital held outside the Trust Account to repay such loaned amounts but no proceeds from our Trust Account would be used for such repayment. Up to $1,500,000 of such loans may be convertible into warrants at a price of $1.50 per warrant, at the option of the lender. The warrants would be identical to the Private Placement Warrants.

We do not believe we will need to raise additional funds in order to meet the expenditures required for operating our business. However, if our estimate of the costs of identifying a target business, undertaking
in-depth
due diligence and negotiating a Business Combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our Business Combination. Moreover, we may need to obtain additional financing either to complete our Business Combination or because we become obligated to redeem a significant number of our Public Shares upon consummation of our Business Combination, in which case we may issue additional securities or incur debt in connection with such Business Combination.

Off-Balance
Sheet Arrangements

We have no obligations, assets or liabilities, which would be considered
off-balance
sheet arrangements as of March 31,September 30, 2021. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating
off-balance
sheet arrangements. We have not entered into any
off-balance
sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any
non-financial
assets.

Contractual obligations

We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities, other than an agreement to pay an affiliate of one of our Sponsor a monthly fee of $10,000 for office space, utilities and secretarial and administrative services. We began incurring these fees on March 4, 2021 and will continue to incur these fees monthly until the earlier of the completion of the Business Combination and our liquidation.

The underwriters are entitled to a deferred fee of $0.35 per unit, or $10,500,000 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 we complete a Business Combination, subject to the terms of the underwriting agreement.

Critical Accounting Policies

The preparation of condensed financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates. We have identified the following critical accounting policies:

Warrant Liability

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. We account for the Warrants in accordance with the guidance contained in ASC
815-40
under which the Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, we classify the Warrants as liabilities at their fair value and adjust the Warrants to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in our statementstatements of operations. The Private Placement Warrants and the Public Warrants for periods where no observable traded price was available are valued using a Monte Carlo simulation. For periods subsequent to the detachment of the Public Warrants from the Units, the Public Warrant quoted market price will be used as the fair value as of each relevant date.

Class A Ordinary Shares Subject to Possible Redemption

We account for our ordinary shares subject to possible conversion in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Ordinary shares subject to mandatory redemption, if any, are classified as a liability instrument and measured at fair value. Conditionally redeemable ordinary shares (including ordinary shares 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, ordinary shares are classified as shareholders’ equity. Our ordinary shares feature certain redemption rights that are considered to be outside of our control and subject to occurrence of uncertain future events. Accordingly, ordinary shares subject to possible redemption are presented at redemption value as temporary equity, outside of the shareholders’ equity section of our condensed balance sheets.

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.
Net Income (Loss) Per Ordinary Share

Net loss per ordinary share is computed by dividing net loss by the weighted average number of ordinary shares outstanding during the period. We apply the
two-class
method in calculating earnings per share. Net income per ordinary share, basic and diluted forAccretion associated with the redeemable shares of Class A redeemable ordinary shares is calculated by dividingexcluded from earnings per share as the interest income earned on the Trust Account by the weighted average numberredemption value approximates fair value.
17
Table of Class A redeemable ordinary shares outstanding since original issuance. Net loss per ordinary share, basic and diluted for Class B non-redeemable ordinary shares is calculated by dividing the net income (loss), less income attributable to Class A redeemable ordinary shares, by the weighted average number of Class B non-redeemable ordinary shares outstanding for the periods presented.

Contents

Recent Accounting Standards

In August 2020, the Financial Accounting Standards Board (“FASB”) issued ASU
2020-06,
Debt — Debt with Conversion and Other Options (Subtopic
470-20)
and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic
815-40) (“
(“ASU
2020-06”)
to simplify accounting for certain financial instruments. ASU
2020-06
eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU
2020-06
amends the diluted earnings per share guidance, including the requirement to use the
if-converted
method for all convertible instruments. ASU
2020-06
is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company adopted ASU
2020-06
as of January 1, 2021, and the adoption did not have an impact on its financial position, results of operations or cash flows.

Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on our condensed financial statements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Not required for smaller reporting companies.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed by us in our reports filed or submitted under the Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms,forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.
Evaluation of Disclosure Controls and Procedures
Disclosure controls are procedures that are designed with the objective of ensuring that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized, and reported within the time period specified in the SEC’s rules and forms. Disclosure controls are also designed with the objective of ensuring that such information is accumulated and communicated to our management, including our principalthe chief executive officer and principalchief financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Under the supervision and

Our management evaluated, with the participation of our management, including our principalchief executive officer and principalchief financial and accounting officer we conducted an evaluation of(our “Certifying Officers”), the effectiveness of our disclosure controls and procedures as of the end of the fiscal quarter ended March 31,September 30, 2021, as such term is defined in Rules 13a-15(e) and 15d-15(e)pursuant to Rule 13a-15(b) under the Exchange Act. Based on thisupon that evaluation, our principal executive officer and principal financial and accounting officer haveCertifying Officers concluded that, duringdue to the period covered by this report, solely dueevents that led to the Company’s restatement of its financial statements to reclassify the Company’s warrants as described in the Explanatory Note 2 to the Financial Statement herein,this Amendment, as of September 30, 2021, our disclosure controls and procedures were not effective as of March 31, 2021, and that the foregoing arose aseffective. As a result, of a material weakness in the Company’s internal control over financial reporting. In light of this material weakness, we performed additional analysis as deemed necessary to ensure that our financial statements were prepared in accordance with U.S. generally accepted accounting principles. Accordingly, management believes that the financial statements included in this Quarterly Report on Form 10-Q10-Q/A present fairly, in all material respects, our financial position, resultsresult of operations and cash flows forof the periods presented.

Management has implemented remediation steps to improve our internal control over financial reporting. Specifically, we expanded and improved our review process for complex securities and related accounting standards. We plan to further improve this process by enhancing access to accounting literature, identification of third-party professionals with whom to consult regarding complex accounting applications and consideration of additional staff with the requisite experience and training to supplement existing accounting professionals.
We do not expect that our disclosure controls and procedures will prevent all errors and all instances of fraud. Disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Further, the design of disclosure controls and procedures must reflect the fact that there are resource constraints, and the benefits must be considered relative to their costs. Because of the inherent limitations in all disclosure controls and procedures, no evaluation of disclosure controls and procedures can provide absolute assurance that we have detected all our control deficiencies and instances of fraud, if any. The design of disclosure controls and procedures also is based partly on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.
Changes in Internal Control over Financial Reporting

There waswere no changeother changes in our internal control over financial reporting that occurred(as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the most recent fiscal quarter of 2021 covered by this Quarterly Report on Form 10-Qthat hashave materially affected, or isare reasonably likely to materially affect, our internal control over financial reporting as the circumstances that led to the restatement of the financial statements had not yet been identified. However, as managementreporting. Management has identified a material weakness in our internal control over financial reporting with respectcontrols related to the classification of the Company’s Warrants as components of equity instead of as liabilities, as well as the related determination of the fair value of warrant liabilities, additional paid-in capital and accumulated deficit, and relatedaccounting for complex financial disclosures, the Company intends to address this material weakness by enhancing itsinstruments. While we have processes to identify and appropriately apply applicable accounting requirements, we plan to better evaluate its researchcontinue to enhance our system of evaluating and understanding ofimplementing the nuances of the complex accounting standards that apply to itsour financial statements. The Company’s current plans include providingstatements, including through enhanced access to accounting literature, research materials and documents and increased communication among itsanalyses by our personnel and third-party professionals with whom it consultswe consult regarding complex accounting applications. The Company has also retainedelements of our remediation plan can only be accomplished over time, and we can offer no assurance that these initiatives will ultimately have the services of a valuation expert to assist in valuation analysis of the Warrants on a quarterly basis.

intended effects.

PART II - II—OTHER INFORMATION

Item 1. Legal Proceedings

None

18
Table of Contents

Item 1A. Risk Factors

Factors that could cause our actual results to differ materially from those in this report include the risk factors described in our final prospectus for its Initial Public Offering filed with the SEC. As of the date of this Quarterly Report, there have been no material changes to the risk factors disclosed in our final prospectus for its Initial Public Offering filed with the SEC as supplemented by the risk factors included in our Quarterly Report on Form
10-Q
for the quarter ended March 31, 2021, except as set forth below.

for the below risk factors. We may disclose changes to such factors or disclose additional factors from time to time in our future filings with the SEC.

We have identified a material weakness in our internal control over financial reporting as of March 31,September 30, 2021. If we are unable to develop and maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results in a timely manner, which may adversely affect investor confidence in us and materially and adversely affect our business and operating results.

On April 12, 2021,

As described elsewhere in this amended Quarterly Report on Form 10-Q/A, notwithstanding the staff of the SEC issued a public statement entitled “Staff Statement on Accounting and Reporting Considerations for Warrants Issued by Special Purpose Acquisition Companies (“SPACs”)” (the “Statement”). In the Statement, the SEC staff, among other things, expressed its view that certain terms and conditions common to warrants issued by special purpose acquisition companies, such as the Company, may require such warrants to be classified as liabilitiesadvice on the special purpose acquisition company’s balance sheetspecific matter also obtained from professional third parties, we have identified a material weakness in our internal control over financial reporting related to the Company’s accounting and reporting of complex financial instruments, including application of ASC 480-10-S99-3A to its accounting classification of public shares. As a result of this material weakness, our management has concluded that our disclosure controls and procedures were not effective as opposedof September 30, 2021. See “Note 2—Restatement of Previously Issued Financial Statements” to equity. The Company previously accounted for its outstanding warrantsthe accompanying financial statements, as componentswell as Part I. Item 4. Controls and Procedures included in this Quarterly Report on Form 10-Q/A. We have taken a number of equity insteadmeasures to remediate the material weaknesses described herein. However, if we are unable to remediate our material weaknesses in a timely manner or we identify additional material weaknesses, we may be unable to provide required financial information in a timely and reliable manner and we may incorrectly report financial information. Likewise, if our financial statements are not filed on a timely basis, we could be subject to sanctions or investigations by the stock exchange on which our shares of as derivative liabilities. See “—Our warrants are accounted for as a warrant liability and will be recorded at fair value with changes in fair value each period reported in earnings, which may have an adverse effect on the market price of our Class A ordinary shares are listed, the SEC or other regulatory authorities. The existence of material weaknesses in internal control over financial reporting could adversely affect our reputation or investor perceptions of us, which could have a negative effect on the trading price of our shares. We can give no assurance that the measures we have taken and plan to take in the future will remediate the material weakness identified or that any additional material weaknesses or restatements of financial results will not arise in the future due to a failure to implement and maintain adequate internal control over financial reporting or circumvention of these controls. Even if we are successful in strengthening our controls and procedures, in the future those controls and procedures may make it more difficult for usnot be adequate to consummate an initial business combination.” In connection with this changeprevent or identify irregularities or errors or to facilitate the fair presentation of our accounting methodology,financial statements.
Our management and our audit committee concluded that, we identified a material weakness in our internal controls 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 our annual or interim financial statements will not be prevented, or detected and corrected on a timely basis.
Effective internal controls are necessary for us to provide reliable financial reports and prevent fraud. We continue to evaluate steps to remediate the material weakness. These remediation measures may be time consuming and costly and there is no assurance that these initiatives will ultimately have the intended effects.
If we identify any new material weaknesses in the future, any such newly identified material weakness could limit our ability to prevent or detect a misstatement of our accounts or disclosures that could result in a material misstatement of our annual or interim financial statements. In such case, we may be unable to maintain compliance with securities law requirements regarding timely filing of periodic reports in addition to applicable stock exchange listing requirements, investors may lose confidence in our financial reporting and our stockshare price may decline as a result. We cannot assure you that the measures we have taken to date, or any measures we may take in the future, will be sufficient to avoid potential future material weaknesses.

We can give no assurance that the measures we have taken and plan to take in the future will remediate the material weakness identified or that any additional material weaknesses or restatements of financial results will not arise in the future due to a failure to implement and maintain adequate internal control over financial reporting or circumvention of these controls. In addition, even if we are successful in strengthening our controls and procedures, in the future those controls and procedures may not be adequate to prevent or identify irregularities or errors or to facilitate the fair presentation of our consolidated financial statements.
We may face litigation and other risks as a result of the material weakness in our internal control over financial reporting.

As a result of such material weakness, the restatement, the change in accounting for the warrants,temporary equity, the resulting material weakness and other matters raised or that may in the future be raised by the SEC, we face potential for litigation or other disputes which may include, among others, claims invoking the federal and state securities laws, contractual claims or other claims arising from the restatement and material weaknesses in our internal control over financial reporting and the preparation of our financial statements. As of the date of this amended Quarterly Report, we have no knowledge of any such litigation or dispute. However, we can provide no assurance that such litigation or dispute will not arise in the future. Any such litigation or dispute, whether successful or not, could have a material adverse effect on our business, results of operations and financial condition or our ability to complete an initial business combination.

Our warrants are accounted for as a warrant liability and will be recorded at fair value with changes in fair value each period reported in earnings, which may have an adverse effect on the market price of our Class A ordinary shares or may make it more difficult for us to consummate an initial business combination.

In connection with our initial public offering and the concurrent private placement of warrants, we issued an aggregate of 16,441,034 warrants (including 10,315,024 warrants included in the units and 6,126,010 private placement warrants). We account for these as a warrant liability and will record at fair value any changes in fair value each period reported in earnings as determined by us based upon a valuation report obtained from an independent third-party valuation firm. The impact of changes in fair value on earnings may have an adverse effect on the market price of our Class A ordinary shares. In addition, potential targets may seek a special purpose acquisition company that does not have warrants or that does not have warrants that are accounted for as a warrant liability, which may make it more difficult for us to consummate an initial business combination with a target business.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

On March 4, 2021, we consummated the Initial Public Offering of 30,000,000 Units. The Units were sold at an offering price of $10.00 per unit, generating total gross proceeds of $300,000,000. Citigroup Global Markets Inc. acted as sole book-running manager and Drexel Hamilton, LLC and Roberts & Ryan Investments, Inc. acted as
co-managers,
of the Initial Public Offering. The securities in the offering were registered under the Securities Act on registration statement on FormS-1 (No.
S-1(No.
333-252891).
The Securities and Exchange CommissionSEC declared the registration statements effective on March 1, 2021.

Simultaneous with the consummation of the Initial Public Offering, the Sponsor consummated the private placement of an aggregate of 6,000,000 Warrants at a price of $1.50 per Private Placement Warrant, generating total proceeds of $9,000,000. Each whole Private Warrant is exercisable to purchase one ordinary share at an exercise price of $11.50 per share. The issuance was made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act.

The Private Warrants are identical to the warrants underlying the Units sold in the Initial Public Offering, except that the Private Warrants are not transferable, assignable or salable until after the completion of a Business Combination, subject to certain limited exceptions.

On March 5, 2021, the underwriters partially exercised their over-allotment option, resulting in the sale of an additional 945,072 Units for gross proceeds of $9,450,720, less the underwriters’ discount of $189,014. In connection with the underwriters’ exercise of their over-allotment option, the Company also consummated the sale of an additional 126,010 Private Placement Warrants at $1.50 per Private Placement Warrant, generating total proceeds of $189,015. A total of $9,450,720 was deposited into the Trust Account.

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Of the gross proceeds received from the Initial Public Offering, the exercise of the over-allotment option and the Private Placement Warrants, an aggregate of $309,450,720 was placed in the Trust Account.

We paid a total of $6,189,014 in underwriting discounts and commissions and $481,557 for other costs and expenses related to the Initial Public Offering.

For a description of the use of the proceeds generated in our Initial Public Offering, see Part I, Item 2 of this Form
10-Q.

Item 3. Defaults Upon Senior Securities

None

Item 4. Mine Safety Disclosures

None

Item 5. Other Information

None

Item 6. Exhibits

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

No.

  

Description of Exhibit

31.1*
  Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rules 13a-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*
  Certification of Principal Financial Officer Pursuant to Securities Exchange Act Rules 13a-14(a), 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

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32.2*
  Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.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 Labels Linkbase Document
101.PRE*
  XBRL Taxonomy Extension Presentation Linkbase Document
104
Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

*

Filed herewith.

(1)

Previously filed as an exhibit to our Current Report on Form 8-K filed on March 4, 2021 and incorporated by reference herein.

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SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 
DHC ACQUISITION CORP.
Date: JulyDecember 21, 2021 By: 

/s/ Christopher Gaertner

 Name: Christopher Gaertner
 Title: 
Co-Chief
Executive Officer
  (Principal Executive Officer)
Date: JulyDecember 21, 2021 By: 

/s/ Christopher Gaertner

 Name: Christopher Gaertner
 Title: Chief Financial Officer
  (Principal Financial and Accounting Officer)

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