☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
2021
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
BOWX ACQUISITION CORP.
Delaware | 85-1144904 | |||
(State or Other Jurisdiction of Incorporation) | (IRS Employer | |||
Identification No.) |
2400 Sand Hill Rd., Suite 200
Menlo Park, CA 94025
(650) 352-4877
Not Applicable
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Class A common stock, par value $0.0001 per share | WE | The | ||
Warrants, each whole warrant exercisable for | WE WS | The |
☐
Large accelerated filer | ☐ | Accelerated filer | ☐ | ||||
Non-accelerated filer | ☒ | Smaller reporting company | ☒ | ||||
Emerging growth company | ☐ |
BOWX ACQUISITION CORP.
Form 10-Q
For the Quarter Ended June 30, 2020
Table of Contents
JUNE 30, 2020
Assets: | ||||
Deferred offering costs associated with initial public offering | $ | 272,925 | ||
Total Assets | $ | 272,925 | ||
Liabilities and Stockholder’s Equity: | ||||
Current liabilities: | ||||
Accrued expenses | $ | 138,620 | ||
Franchise tax payable | 23,064 | |||
Note payable – related party | 109,706 | |||
Total current liabilities | 271,390 | |||
Commitments and Contingencies | ||||
Stockholder’s Equity: | ||||
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding | - | |||
Class A common stock, $0.0001 par value; 87,500,000 shares authorized; none issued and outstanding | - | |||
Class B common stock, $0.0001 par value; 12,500,000 shares authorized; 12,075,000 shares issued and outstanding (1)(2) | 1,208 | |||
Additional paid-in capital | 23,792 | |||
Accumulated deficit | (23,465 | ) | ||
Total stockholder’s equity | 1,535 | |||
Total Liabilities and Stockholder’s Equity | $ | 272,925 |
SHEETS
September 30, 2021 | December 31, 2020 | |||||||
(Unaudited) | ||||||||
Assets: | ||||||||
Current assets: | ||||||||
Cash | $ | 242,155 | $ | 921,049 | ||||
Prepaid expenses | 240,705 | 372,412 | ||||||
Total current assets | 482,860 | 1,293,461 | ||||||
Investments held in Trust Account | 483,078,641 | 483,227,051 | ||||||
Total assets | $ | 483,561,501 | $ | 484,520,512 | ||||
Liabilities, Class A Common Stock Subject to Possible Redemption and Stockholders’ Deficit: | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 376,731 | $ | 315 | ||||
Accrued expenses | 5,791,175 | 76,695 | ||||||
Accrued income tax | 0 | 12,010 | ||||||
Franchise tax payable | 73,311 | 122,242 | ||||||
Total current liabilities | 6,241,217 | 211,262 | ||||||
Deferred underwriting commissions in connection with the initial public offering | 16,905,000 | 16,905,000 | ||||||
Warrant liabilities | 16,168,533 | 13,292,400 | ||||||
Total liabilities | 39,314,750 | 30,408,662 | ||||||
Commitments and Contingencies (Note 5) | 0 | 0 | ||||||
Class A common stock subject to possible redemption, $0.0001 par value; 48,300,000 shares at $10.00 per share as of September 30, 2021 and December 31, 2020 | 483,000,000 | 483,000,000 | ||||||
Stockholders’ Deficit: | ||||||||
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; NaN issued and outstanding as of September 30, 2021 and December 31, 2020 | 0— | 0— | ||||||
Class A common stock, $0.0001 par value; 87,500,000 shares authorized as of September 30, 2021 and December 31, 2020 | 0 | 0 | ||||||
Class B common stock, $0.0001 par value; 12,500,000 shares authorized; 12,075,000 shares issued and outstanding as of September 30, 2021 and December 31, 2020 | 1,208 | 1,208 | ||||||
Accumulated deficit | (38,754,457 | ) | (28,889,358 | ) | ||||
Total stockholders’ deficit | (38,753,249 | ) | (28,888,150 | ) | ||||
Total Liabilities, Class A Common Stock Subject to Possible Redemption and Stockholders’ Deficit | $ | 483,561,501 | $ | 484,520,512 | ||||
FOR THE PERIOD FROM MAY 19, 2020 (INCEPTION) THROUGH JUNE 30, 2020
General and administrative expenses | $ | 401 | ||
Franchise tax expense | 23,064 | |||
Net loss | $ | (23,465 | ) | |
Weighted average shares outstanding, basic and diluted (1)(2) | 10,500,000 | |||
Basic and diluted net loss per share | $ | (0.00 | ) |
For the Three Months Ended | For the Nine Months Ended | For the Period from May 19, 2020 (Inception) | ||||||||||||||
September 30, 2021 | September 30, 2020 | September 30, 2021 | through September 30, 2020 | |||||||||||||
Operating expenses | ||||||||||||||||
General and administrative expenses | $ | 2,815,163 | $ | 92,911 | $ | 6,905,678 | $ | 93,312 | ||||||||
Franchise tax expense | 50,411 | 49,315 | 149,589 | 72,379 | ||||||||||||
Loss from operations | (2,865,574 | ) | (142,226 | ) | (7,055,267 | ) | (165,691 | ) | ||||||||
Change in fair value of warrant liabilities | 9,794,399 | (1,243,733 | ) | (2,876,133 | ) | (1,243,733 | ) | |||||||||
Offering costs associated w ith private placement warrants | — | (9,344 | ) | — | (9,344 | ) | ||||||||||
Net gain from investments held in Trust Account | 6,937 | 83,554 | 66,301 | 83,554 | ||||||||||||
Income (loss) before income tax expense | 6,935,762 | (1,311,749 | ) | (9,865,099 | ) | (1,335,214 | ) | |||||||||
Income tax expense | — | 2,347 | — | 2,347 | ||||||||||||
Net income (loss) | $ | 6,935,762 | $ | (1,314,096 | ) | $ | (9,865,099 | ) | $ | (1,337,561 | ) | |||||
Weighted average shares outstanding of Class A common stock, basic and diluted | 48,300,000 | 28,464,130 | 48,300,000 | 20,458,594 | ||||||||||||
Basic and diluted net income (loss) per share, Class A common stock | $ | 0.11 | $ | (0.03 | ) | $ | (0.16 | ) | $ | (0.04 | ) | |||||
Weighted average shares outstanding of Class B common stock, basic and diluted | 12,075,000 | 11,338,859 | 12,075,000 | 11,102,930 | ||||||||||||
Basic and diluted net income (loss) per share, Class B common stock | $ | 0.11 | $ | (0.03 | ) | $ | (0.16 | ) | $ | (0.04 | ) | |||||
FOR THE PERIOD FROM MAYSTOCKHOLDERS’ DEFICIT
Class B Common Stock | Additional Paid-In | Accumulated | Total Stockholders’ | |||||||||||||||||
Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||
Balance - December 31, 2020 | 12,075,000 | $ | 1,208 | $ | 0 | $ | (28,889,358 | ) | $ | (28,888,150 | ) | |||||||||
Net loss | — | — | — | (5,617,146 | ) | (5,617,146 | ) | |||||||||||||
Balance - March 31, 2021 (Unaudited) | 12,075,000 | 1,208 | 0 | (34,506,504 | ) | (34,505,296 | ) | |||||||||||||
Net loss | — | — | — | (11,183,715 | ) | (11,183,715 | ) | |||||||||||||
Balance - June 30, 2021 (Unaudited) | 12,075,000 | 1,208 | 0 | (45,690,219 | ) | (45,689,011 | ) | |||||||||||||
Net income | — | — | — | 6,935,762 | 6,935,762 | |||||||||||||||
Balance - September 30, 2021 (Unaudited) | 12,075,000 | $ | 1,208 | $ | 0 | $ | (38,754,457 | ) | $ | (38,753,249 | ) | |||||||||
Common Stock | Additional | Total | ||||||||||||||||||||||||||
Class A | Class B | Paid-In | Accumulated | Stockholder’s | ||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Capital | Deficit | Equity | ||||||||||||||||||||||
Balance - May 19, 2020 (inception) | - | $ | - | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||||||
Issuance of Class B common stock to related party (1)(2) | - | - | 12,075,000 | 1,208 | 23,792 | - | 25,000 | |||||||||||||||||||||
Net loss | - | - | - | - | - | (23,465 | ) | (23,465 | ) | |||||||||||||||||||
Balance - June 30, 2020 (unaudited) | - | $ | - | 12,075,000 | $ | 1,208 | $ | 23,792 | $ | (23,465 | ) | $ | 1,535 |
Total | ||||||||||||||||||||
Class B Common Stock | Additional Paid-In | Accumulated | Stockholders’ | |||||||||||||||||
Shares | Amount | Capital | Deficit | Equity (Deficit) | ||||||||||||||||
Balance - May 19, 2020 (inception) | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | |||||||||||
Issuance of Class B common stock to initial stockholders | 12,075,000 | 1,208 | 23,792 | — | 25,000 | |||||||||||||||
Net loss | — | — | — | (23,465 | ) | (23,465 | ) | |||||||||||||
Balance - June 30, 2020 (Unaudited) | 12,075,000 | $ | 1,208 | $ | 23,792 | $ | (23,465 | ) | $ | 1,535 | ||||||||||
Excess cash received over the fair value of the private warrants | — | — | 3,031,600 | — | 3,031,600 | |||||||||||||||
Offering costs associated with public warrants | (964,454 | ) | — | (964,454 | ) | |||||||||||||||
Accretion on Class A common stock subject to possible redemption amount | — | — | (2,090,938 | ) | (24,079,042 | ) | (26,169,980 | ) | ||||||||||||
Net loss | — | — | — | (1,314,096 | ) | (1,314,096 | ) | |||||||||||||
Balance - September 30, 2020 (Unaudited) | 12,075,000 | $ | 1,208 | $ | 0 | $ | (25,416,603 | ) | $ | (25,415,395 | ) | |||||||||
FOR THE PERIOD FROM MAY 19, 2020 (INCEPTION) THROUGH JUNE 30, 2020
Cash Flows from Operating Activities: | ||||
Net loss | $ | (23,465 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
General and administrative expenses paid by related party | 381 | |||
Changes in operating assets and liabilities: | ||||
Accrued expenses | 20 | |||
Franchise tax payable | 23,064 | |||
Net cash used in operating activities | - | |||
Net change in cash | - | |||
Cash - beginning of the period | - | |||
Cash - end of the period | $ | - | ||
Supplemental disclosure of noncash activities: | ||||
Deferred offering costs paid by related party in exchange for issuance of Class B common stock | $ | 25,000 | ||
Deferred offering costs included in accrued expenses | $ | 138,600 | ||
Deferred offering costs included in note payable | $ | 109,325 |
For the Nine Months Ended September 30, 2021 | For the Period from May 19, 2020 (Inception) through September 30, 2020 | |||||||
Cash Flows from Operating Activities: | ||||||||
Net loss | $ | (9,865,099 | ) | $ | (1,337,561 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
General and administrative expenses paid by related party | 0— | 381 | ||||||
Change in fair value of warrant liabilities | 2,876,133 | 1,243,733 | ||||||
Offering costs associated with private placement warrants | 0 | 9,344 | ||||||
Net gain from investments held in Trust Account | (66,301 | ) | (83,554 | ) | ||||
Changes in operating assets and liabilities: | ||||||||
Prepaid expenses | 131,707 | (456,593 | ) | |||||
Accounts payable | 376,416 | 6,115 | ||||||
Accrued expenses | 5,714,480 | (5,000 | ) | |||||
Accrued income tax | (12,010 | ) | 2,347 | |||||
Franchise tax payable | (48,931 | ) | 72,379 | |||||
Net cash used in operating activities | (893,605 | ) | (548,409 | ) | ||||
Cash Flows from Investing Activities | ||||||||
Interest released from Trust Account | 214,711 | 0— | ||||||
Cash deposited in Trust Account | 0 | (483,000,000 | ) | |||||
Net cash provided by (used in) investing activities | 214,711 | (483,000,000 | ) | |||||
Cash Flows from Financing Activities: | ||||||||
Repayment of note payable to related party | 0 | (195,475 | ) | |||||
Proceeds received from initial public offering, gross | 0 | 483,000,000 | ||||||
Proceeds received from private placement | 0 | 11,660,000 | ||||||
Offering costs paid | — | (9,943,684 | ) | |||||
Net cash provided by financing activities | 0 | 484,520,841 | ||||||
Net (decrease) increase in cash | (678,894 | ) | 972,432 | |||||
Cash - beginning of the period | 921,049 | 0— | ||||||
Cash - end of the period | $ | 242,155 | $ | 972,432 | ||||
Supplemental Cash Flow Information | ||||||||
Cash paid for income taxes | $ | 34,957 | $ | 0— | ||||
Supplemental disclosure of noncash activities: | ||||||||
Offering costs paid by related party in exchange for issuance of Class B common stock | $ | 0— | $ | 25,000 | ||||
Offering costs included in accrued expenses | $ | 0— | $ | 75,000 | ||||
Offering costs included in note payable | $ | 0— | $ | 195,094 | ||||
Deferred underwriting commissions in connection with the initial public offering | $ | 0 | $ | 16,905,000 | ||||
NOTE 1. ORGANIZATION, BUSINESS OPERATIONS AND BASIS OF PRESENTATION
Incorporation
Fiscal Year End
The Company has selected December 31 as its fiscal year end.
Business Purpose
The Company was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or other similar business combination (“Business Combination”) with one or more operating businesses or entities that it has not yet selected (a “target business”). Although theselected. The Company is not limited to a particular industry or sector for purposes of consummating a Business Combination, the Company initially intends to focus its search on target businesses in the technology, media and telecommunications industries.Combination. The Company has neither engaged in any operations nor generated revenue to date.
The Company’s management has broad discretion with respect As of September 30, 2021, the Company was an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities Act”), as modified by the Jumpstart our Business Startups Act of 2012 (the “JOBS Act”).
Trust Account (as defined below).
BOWX ACQUISITION CORP.
Pursuant
The Company’s amended and restated certificate of incorporation provides that, other than the withdrawal of interest earned on the funds that may be released to the Company to pay taxes, none of the funds held in Trust Account will be released until the earliest of: (i) the completion of the Business Combination; (ii) the redemption of any of Public Shares to its holders (the “Public Stockholders”) properly tendered in connection with a stockholder votethe Business Combination. BowX’s stockholders voted to amend certain provisions of the Company’s amended and restated certificate of incorporation prior to an initial Business Combination and (iii) the redemption of 100% of the Public Shares if the Company does not complete a Business Combination within the Combination Period (as defined below).
approve its business combination with WeWork.
The Company will only have 24 months from the closing of the Initial Public Offering, or August 7, 2022, to complete its initial Business Combination (the “Combination Period”)additional information
BOWX ACQUISITION CORP.NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Liquidity and Capital Resources
As of June 30, 2020, the Company had no cash and a working capital deficit of approximately $271,000.
Prior to June 30, 2020, the Company’s liquidity needs were satisfied through a payment of $25,000 from the Company’s Chairman and Co-Chief Executive Officer to cover for certain offering costs in exchange for the issuance of the Founder Shares (as defined below), and the loan under the
Based on the foregoing, management believes that the Company will have sufficient working capital and borrowing capacity to meet its needs through the earlier of the consummation of a Business Combination or one year from this filing. Over this time period, the Company will be using these funds for paying existing accounts payable, identifying and evaluating prospective initial Business Combination candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to merge with or acquire, and structuring, negotiating and consummating the Business Combination.
Management continues to evaluate the impact of the COVID-19 pandemic and has concluded that the specific impact is not readily determinable as of the date of the balance sheet. The financial statement does not include any adjustments that might result from the outcome of this uncertainty.
2—Basis of Presentation
and Summary of Significant Accounting Policies
2021 or for any future periods.
and the unaudited condensed consolidated balance sheets as of September 30, 2020, March 31, 2021, and June 30, 2021, is a reclassification of $33.9 million, $30.4 million, $39.5 million and $50.7
The
BOWX ACQUISITION CORP.NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The Company’s investments held in the Trust Account is comprised of investments in U.S. Treasury securities with an original maturity of 185 days or less or investments in a money market funds that comprise only U.S. treasury securities money market funds
Usesheets.
The preparationan asset or paid for transfer of financial statementsa liability, in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilitiesan orderly transaction between market participants at the datemeasurement date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value.
Deferred fair value hierarchy based on the lowest level input that is significant to the fair val
The Company complies with the requirements of the ASC 340-10-S99-1.
The Company classifies deferred underwriting commissions as
Share.” The Company has two classes of shares, which are referred to as Class A common stock and Class B common stock. Income and losses are shared pro rata between the two classes of shares. Net income (loss) per share of common stock is calculated by dividing the net income (loss) by the weighted average number of common stock outstanding for the respective period.
from May 19, 2020 (inception) through September 30, 2020. Accretion associated with the redeemable Class A common stock is excluded from earnings per share as the redemption value approximates fair value
BOWX ACQUISITION CORP. $ 5,548,610 $ 1,387,152 $ (7,892,080 ) $ (1,973,019 ) 48,300,000 12,075,000 48,300,000 12,075,000 $ 0.11 $ 0.11 $ (0.16 ) $ (0.16 ) $ (939,743 ) $ (374,353 ) $ (867,025 ) $ (470,536 ) 28,464,130 11,338,859 20,458,594 11,102,930 $ (0.03 ) $ (0.03 ) $ (0.04 ) $ (0.04 )
There were no unrecognized tax benefits as of June 30, 2020.
The provision for income taxes was deemed to be de minimis for the period from May 19, 2020 (inception) through June 30, 2020.
Management
NOTE 3. INITIAL PUBLIC OFFERING
accompanying unaudited condensed consolidated financial statements.
On
Underwriting Agreement
The Company granted the underwriter a 45-day option to purchase up to 6,300,000 additional Units to cover any over-allotments, at the Initial Public Offering price less the underwriting discounts and commissions. On August 10, 2020, the underwriter fully exercised the over-allotment option.
The underwriter was entitled to an underwriting discount of $0.20 per unit, or $8.4 million in the aggregate, paid upon the closing of the Initial Public Offering. In addition, $0.35 per unit, or $14.7 million in the aggregate will be payable to the underwriter for deferred underwriting commissions. The deferred fee will become payable to the underwriter 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.
BOWX ACQUISITION CORP.NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
In connection with the consummation of the sale of Units pursuant to the over-allotment option on August 13, 2020, the underwriter was entitled to an aggregate of $1.26 million in fees payable upon closing and an additional deferred underwriting commissions of approximately $2.2 million.
NOTE 4. RELATED PARTY TRANSACTIONS
BOWX ACQUISITION CORP.NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 5. COMMITMENTS AND CONTINGENCIES
NOTE 6. STOCKHOLDER’S EQUITY
Class A Common Stock—The Company is authorized to issue 87,500,000 shares of Class A common stock with a par shares value of $0.0001 per share. At June 30, 2020, there were no shares of Class A common stock issued or outstanding.
Class B Common Stock—The Company is authorized to issue 12,500,000 shares of Class B common stock with a par value of $0.0001 per share. Holders of the Company’s Class B common stock are entitled to one vote for each share. On August 4, 2020, the Company effected a stock dividend of 0.2 shares of Class B common stock for each share of Class B common stock outstanding. All shares and associated amounts have been retroactively restated to reflect the share dividend. As of June 30, 2020, there were 12,075,000 shares of Class B common stock issued and outstanding, of which up to 1,575,000 are subject to forfeiture to the Company to the extent that the underwriter’s over-allotment option is not exercised in full or in part, so that the shares of Class B common stock will represent 20% of the Company’s issued and outstanding common stock after the Initial Public Offering. On August 10, 2020, the underwriter fully exercised the over-allotment option and the Company consummated the sale of Units pursuant to the over-allotment option on August 13, 2020; thus, these 1,575,000 Founder Shares were no longer subject to forfeiture.
The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of the initial Business Combination, or earlier at the option of the holder, on a one-for-one basis (subject to adjustment for stock splits, stock dividends, reorganizations, recapitalizations and the like, and subject to further adjustment
BOWX ACQUISITION CORP.Preferred stock—
2021, these fees were approximately
BOWX ACQUISITION CORP.NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 7. SUBSEQUENT EVENTS
Gross proceeds received from Initial Public Offering and over-allotment | $ | 483,000,000 | ||
Less: | ||||
Offering costs allocated to Class A common stock | (26,169,980 | ) | ||
Plus: | ||||
Accretion on Class A common stock to redemption value | 26,169,980 | |||
Class A common stock subject to possible redemption | $ | 483,000,000 | ||
Fair Value Measured as of September 30, 2021 | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets | ||||||||||||||||
Investments held in Trust Account - U.S. Treasury Securities | $ | 483,078,641 | $ | — | $ | — | $ | 483,078,641 | ||||||||
Liabilities: | ||||||||||||||||
Warrant liabilities | $ | — | $ | 16,168,533 | $ | — | $ | 16,168,533 |
Fair Value Measured as of December 31, 2020 | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets | ||||||||||||||||
Investments held in Trust Account—U.S. Treasury Securities | $ | 483,227,051 | $ | — | $ | — | $ | 483,227,051 | ||||||||
Liabilities: | ||||||||||||||||
Warrant liabilities | $ | — | $ | 13,292,400 | $ | — | $ | 13,292,400 |
Management hasconsolidated statements of operations. For the three months ended September 30, 2021, the Company recognized a charge to the condensed statements of operations resulting from a
Warrant liabilities at December 31, 2020 | $ | 13,292,400 | ||
Change in fair value of warrant liabilities | 3,342,533 | |||
Warrant liabilities at March 31, 2021 | 16,634,933 | |||
Change in fair value of warrant liabilities | 9,327,999 | |||
Warrant liabilities at June 30, 2021 | 25,962,932 | |||
Change in fair value of warrant liabilities | (9,794,399 | ) | ||
Warrant liabilities at September 30, 2021 | $ | 16,168,533 | ||
We will only have 24 months from the closing of the Initial Public Offering, or August 7, 2022, to complete our initial
SEC on October 26, 2021, for additional information.
Prior to June$5.8 million.
Based on the foregoing, management believes that we will have sufficient working capital and borrowing capacity to meet its needs through the earlier of the consummation of a Business Combination or one year from this filing. Over this time period, we will be using these funds for paying existing accounts payable, identifying and evaluating prospective initial Business Combination candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to merge with or acquire, and structuring, negotiating and consummating the Business Combination.
Management continues to evaluate the impact of the COVID-19 pandemic and has concluded that the specific impact is not readily determinable as of the date of the balance sheet. The financial statement does not include any adjustments that might result from the outcome of this uncertainty.
expense, approximately $2,000 of income tax expense, and approximately $10,000 offering costs associated with private placement warrants, partially offset by approximately $84,000 of interest income from investments held in Trust Account.
Deferred Offering Costs Associated
guidance in ASC Topic 480, “Distinguishing Liabilities from Equity.” Shares of Class A common stock subject to mandatory redemption (if any) are classified as liability instruments and are measured at fair value. Shares of conditionally redeemable Class A common stock (including Class A common stock that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control) are classified as temporary equity. At all other times, shares of Class A common stock are classified as stockholders’ equity. Our Class A common stock features certain redemption rights that are considered to be outside of our control and subject to the occurrence of uncertain future events. Accordingly, as of September 30, 2021 and December 31, 2020, 48,300,000 shares of Class A common stock subject to possible redemption are presented as temporary equity, outside of the stockholders’ equity section of the accompanying condensed consolidated balance sheet.
shares. Net Loss Per Share
Net lossincome (loss) per share of common stock is computedcalculated by dividing the net loss applicable to stockholdersincome (loss) by the weighted average number of sharescommon stock outstanding for the respective period.
Additionally, we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an “emerging growth company,” we choose to rely on such exemptions we may not be required to, among other things, (i) provide an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (auditor discussion and analysis) and (iv) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation. These exemptions will apply for a period of five years following the completion of our Initial Public Offering or until we are no longer an “emerging growth company,” whichever is earlier.
We have not engaged in any hedging activities since our inception and we do not expect to engage in any hedging activities with respect to the market risk to which we are exposed.
effective as of September 30, 2021.
financial reporting
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
* | These certifications are furnished to the SEC pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall they be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing. |
Dated: | ||||||
November 15, 2021 | WEWORK INC. | |||||
By: | /s/ | |||||
Name: | Benjamin Dunham | |||||
Title: | Chief Financial Officer (Principal Financial Officer) |
20