UNITED STATES☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2021
☐ TRANSITION 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 | ||||
| For the quarterly period ended September 30, 2021 | |||||
| ☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||
| Delaware | 84-2308711 | |||||||
(State or other jurisdiction of | (I.R.S. Employer | |||||||
| incorporation or organization) |
Identification No.) | |||||||
| |||||||||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||
| ELMS | The Nasdaq Stock Market LLC | |||||||||||
| Warrants, each whole warrant exercisable for one share of | ELMSW | The Nasdaq Stock Market LLC | ||||||||||
| ☐ Large accelerated filer | ☐ Accelerated filer | ||||
| ☒ Smaller reporting company | |||||
| ☒ Non-accelerated filer | ☒ Emerging growth company | ||||
As☒
FORUM MERGER III CORPORATION
FINANCIAL STATEMENTS Three Months Ended March 31, The 2020 included in the definitive proxy statement filed on June 9, 2021. The accompanying condensed consolidated financial statements are unaudited; however, in the opinion of management, they include all normal and recurring adjustments necessary to fairly state the Company’s unaudited condensed consolidated financial statements for the periods presented. Results of operations reported for interim periods are not necessarily indicative of results for the entire year or any other periods. equity as shares are issued, with the appropriate allocation to common stock at par and additional paid-in capital. Since all Earnout Shares have determined to be classified as equity, there is no remeasurement unless reclassification is required. electric 'last mile' delivery and utility vehicles. Revenues are recognized when control of these products is transferred to its customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those products. Shipping and handling fees charged to customers are reported within revenue. Incidental items that are immaterial in the context of the contract are recognized as expense. The be realized. next twelve months. Pronouncements Redemption of warrants when the price per share of warrant holders. exercised. March 31, 2020 December 31, 2019 Transfers to/from Levels 1, 2 and 3 are recognized at the end of the reporting period. There were no transfers between levels for the PagePage 134517212020212121212222222223iCondensed Consolidated Financial Statements.
CONDENSED CONSOLIDATED BALANCE SHEETS March 31, December 31, 2021 2020 (Unaudited) ASSETS Current assets Cash $ 1,038,353 $ 1,555,497 Prepaid expenses 174,124 157,486 Total Current Assets 1,212,477 1,712,983 Cash and marketable securities held in Trust Account 250,004,042 250,066,590 Total Assets $ 251,216,519 $ 251,779,573 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities - Accounts payable and accrued expenses $ 3,815,030 $ 3,329,929 Deferred underwriting fee payable 8,750,000 8,750,000 Warrant liabilities 16,325,028 29,859,848 Total Liabilities 28,890,058 41,939,777 Commitments and Contingencies Class A common stock subject to possible redemption, 21,732,646 and 20,483,979 shares at redemption value as of March 31, 2021 and December 31, 2020, respectively 217,326,460 204,839,790 Stockholders’ Equity Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued or outstanding — — Class A common stock, $0.0001 par value; 100,000,000 shares authorized; 4,008,604 and 5,257,271 issued and outstanding (excluding 21,732,646 and 20,483,979, none shares subject to possible redemption) as of March 31, 2021 and December 31, 2020, respectively 401 526 Class B common stock, $0.0001 par value; 10,000,000 shares authorized; 6,250,000 shares issued and outstanding as of March 31, 2021 and December 31, 2020 625 625 Additional paid-in capital 21,875,691 34,362,236 Accumulated deficit (16,876,716 ) (29,363,381 ) Total Stockholders’ Equity 5,000,001 5,000,006 Total Liabilities and Stockholders’ Equity $ 251,216,519 $ 251,779,573 The (in thousands, except par value and share data)Successor Predecessor September 30,
2021December 31,
2020December 31,
2020ASSETS (Unaudited) Current assets: Cash and cash equivalents $ 143,154 $ 25,205 $ — Restricted cash 27,750 — — Accounts receivable 136 — — Prepaid expenses and other current assets 8,503 — 42 Inventories 7,579 — — Total current assets 187,122 25,205 42 Property, plant and equipment, net 192,736 — 131,908 Intangibles and other assets, net 6,124 38 — TOTAL ASSETS $ 385,982 $ 25,243 $ 131,950 LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT) Current liabilities: Accounts payable $ 7,757 $ 1,345 $ 178 Accrued expenses 10,386 5,532 1,233 Current portion of land contract and promissory note 54,286 — — Total current liabilities 72,429 6,877 1,411 Convertible promissory notes — 25,094 — Land contract and promissory note obligations, net of current portion 29,800 — — Warrant liabilities 14,243 — — Pension benefit obligation 90 — 109 Other long-term liabilities 451 — — Total liabilities 117,013 31,971 1,520 COMMITMENTS AND CONTINGENCIES 0 0 0 Predecessor parent's net investment — — 130,430 Preferred stock, $0.0001 par value; 100 million shares authorized; none issued or outstanding. — — — Common stock, $0.0001 par value; 1 billion shares authorized; 124,027,012 issued and 118,777,012 outstanding at September 30, 2021 and 82,117,288 issued and outstanding at December 31, 2020. 12 8 — Additional paid-in capital 306,578 992 — Accumulated deficit (37,621) (7,728) — Total shareholders' equity (deficit) 268,969 (6,728) 130,430 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 385,982 $ 25,243 $ 131,950 are an integral part of the unauditedto condensed consolidated financial statements.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(Unaudited) 2021 2020 General and administrative expenses $ 1,054,321 $ 160 Loss from operations (1,054,321 ) (160 ) Other income: Interest earned on marketable securities held in Trust Account 6,166 — Change in fair value of warrant liabilities 13,534,820 — Net income (loss) $ 12,486,665 $ (160 ) Weighted average shares outstanding of Class A redeemable common stock 25,000,000 — Basic and diluted income per share, Class A $ 0.00 $ — Basic weighted average shares outstanding of Class A and Class B non-redeemable common stock 6,991,250 6,250,000 Basic net income (loss) per share, Class A and Class B non-redeemable common stock $ 1.79 $ (0.00 ) Diluted weighted average shares outstanding of Class A and Class B non-redeemable common stock and non-redeemable warrants 7,152,316 6,250,000 Diluted net loss per share, Class A and Class B non-redeemable common stock and non-redeemable warrants $ (0.15 ) $ (0.00 ) The AND COMPREHENSIVE LOSS (UNAUDITED) (in thousands, except share and per share data)Successor Predecessor Three Months Ended September 30, 2021 For the
period from
August 20, 2020 through September 30, 2020Three Months Ended September 30, 2020 REVENUE $ 136 $ — $ — COST OF REVENUE 134 — — Gross margin 2 — — OPERATING EXPENSES: Research and development expense 5,642 — — General and administrative expense 16,699 — 1,916 Total operating expenses 22,341 — 1,916 LOSS FROM OPERATIONS (22,339) — (1,916) Interest expense (656) — — Gain on change in fair value of warrant liabilities 5,204 — — Other income (expense), net 12 — (26) LOSS BEFORE INCOME TAXES (17,779) — (1,942) Income tax benefit — — — NET LOSS AND COMPREHENSIVE LOSS $ (17,779) $ — $ (1,942) LOSS PER SHARE: Basic and diluted loss per share $ (0.15) $ — Basic and diluted weighted shares outstanding 118,777,012 821,173 are an integral part of the unauditedto condensed consolidated financial statements.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY(Unaudited)THREE MONTHS ENDED MARCH 31, 2021 Class A
Common Stock Class B
Common Stock Additional
Paid-in Accumulated Total
Stockholders’ Shares Amount Shares Amount Capital Deficit Equity Balance – January 1, 2021 5,257,271 $ 526 6,250,000 $ 625 $ 34,362,236 $ (29,363,381 ) $ 5,000,006 Change in value of Class A common stock subject to possible redemption (1,248,667 ) (125 ) — — (12,486,545 ) — (12,486,670 ) Net income — — — — — 12,486,665 12,486,665 Balance – March 31, 2021 4,008,604 $ 401 6,250,000 $ 625 $ 21,875,691 $ (16,876,716 ) $ 5,000,001 THREE MONTHS ENDED MARCH 31, 2020 Class A
Common Stock Class B
Common Stock Additional
Paid-in Accumulated Total
Stockholders’ Shares Amount Shares Amount Capital Deficit Equity Balance – January 1, 2020 — $ — 7,187,500 $ 719 $ 24,281 $ (2,156 ) $ 22,844 Net loss — — — — — (160 ) (160 ) Balance – March 31, 2020 — $ — 7,187,500 $ 719 $ 24,281 $ (2,316 ) $ 22,684 TheOPERATIONS AND COMPREHENSIVE LOSS (UNAUDITED) (in thousands, except share and per share data)Successor Predecessor Nine Months Ended September 30, 2021 For the
period from
August 20, 2020 through September 30, 2020For the
period from
January 1, 2021
through
June 25, 2021Nine Months Ended September 30, 2020 REVENUE $ 136 $ — $ — $ — COST OF REVENUE 134 — — — Gross margin 2 — — — OPERATING EXPENSES: Research and development expense 8,381 — — — General and administrative expense 24,553 — 1,619 6,040 Total operating expenses 32,934 — 1,619 6,040 LOSS FROM OPERATIONS (32,932) — (1,619) (6,040) Interest expense (3,126) — — — Gain on change in fair value of warrant liabilities 6,149 — — — Other income (expense), net 16 — (2) (27) LOSS BEFORE INCOME TAXES (29,893) — (1,621) (6,067) Income tax benefit — — — — NET LOSS AND COMPREHENSIVE LOSS $ (29,893) $ — $ (1,621) $ (6,067) LOSS PER SHARE: Basic and diluted loss per share $ (0.31) $ — Basic and diluted weighted shares outstanding 95,153,979 821,173 are an integral part of the unauditedto condensed consolidated financial statements.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY (DEFICIT) (UNAUDITED) (in thousands, except share data) Common Stock Additional
Paid-In
CapitalAccumulated Deficit Total Shareholders'
Equity
(Deficit)Shares Amount Balances - August 20, 2020 — $ — $ — $ — $ — Initial funding 1,000 — 10 — 10 Retroactive application of recapitalization 820,173 — — — — Balances - September 30, 2020 821,173 — $ 10 — 10 Balances - December 31, 2020 100,000 — 1,000 (7,728) (6,728) Retroactive application of recapitalization 82,017,288 8 (8) — — Balances - December 31, 2020 - Recasted 82,117,288 8 992 (7,728) (6,728) Net loss — — — (3,528) (3,528) Balances - March 31, 2021 82,117,288 8 992 (11,256) (10,256) Repurchase of common stock from related party - Note 19 (5,006,691) (1) (60) — (61) Reverse recapitalization - Note 3 33,914,192 4 223,064 — 223,068 Conversion of ELM Convertible Notes - Note 11 2,752,223 — 27,522 — 27,522 Issuance of shares for SERES Asset Purchase - Note 4 5,000,000 1 49,949 — 49,950 Net loss — — — (8,586) (8,586) Balances - June 30, 2021 118,777,012 12 301,467 (19,842) 281,637 Stock-based compensation — — 5,111 — 5,111 Net loss — — — (17,779) (17,779) Balances - September 30, 2021 118,777,012 $ 12 $ 306,578 $ (37,621) $ 268,969
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY (DEFICIT) (UNAUDITED)(in thousands) Predecessor Parent's Net
InvestmentBalances - December 31, 2019 $ 130,906 Net loss (2,351) Share based compensation 28 Change in Predecessor parent's net investment 2,083 Balances - March 31, 2020 130,666 Net loss (1,774) Share based compensation 28 Change in Predecessor parent's net investment 1,872 Balances —June 30, 2020 130,792 Net loss (1,942) Share based compensation 19 Change in Predecessor parent's net investment 1,827 Balances —September 30, 2020 $ 130,696 Balances - December 31, 2020 $ 130,430 Net loss (890) Share based compensation 13 Change in Predecessor parent's net investment 1,199 Balances - March 31, 2021 130,752 Net loss (731) Share based compensation 12 Change in Predecessor parent's net investment 790 Balances —June 25, 2021 $ 130,823
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited) Three Months Ended March 31, 2021 2020 Cash Flows from Operating Activities: Net income (loss) $ 12,486,665 $ (160 ) Adjustments to reconcile net income (loss) to net cash used in operating activities: Change in fair value of warrant liabilities (13,534,820 ) — Interest earned on marketable securities held in Trust Account (6,166 ) — Changes in operating assets and liabilities: Prepaid expenses (16,638 ) — Accounts payable and accrued expenses 485,101 350 Net cash (used in) provided by operating activities (585,858 ) 190 Cash Flows from Investing Activities: Cash withdrawn from Trust Account for the payment of franchise taxes 68,714 — Net cash provided by investing activities 68,714 — Net Change in Cash (517,144 ) 190 Cash – Beginning of period 1,555,497 19,810 Cash – End of period $ 1,038,353 $ 20,000 Non-cash investing and financing activities: Change in value of Class A common stock subject to possible redemption $ 12,486,670 $ — The (UNAUDITED) (in thousands)Successor Predecessor Nine Months Ended September 30, 2021 For the
period from
August 20, 2020 through September 30, 2020For the
period from
January 1, 2021
through
June 25, 2021Nine Months Ended September 30, 2020 OPERATING ACTIVITIES: Net loss $ (29,893) $ — $ (1,621) $ (6,067) Adjustment to reconcile net loss to net cash used in operating activities: Noncash interest expense 2,470 — — — Gain on change in fair value of warrant liabilities (6,149) — — — Depreciation and amortization expense 1,229 — 23 35 Other 72 — — — Defined benefit pension expense, net of (funding) (23) — 17 64 Share based compensation 5,111 — 25 75 Loss on disposal of equipment — — — 69 Changes in operating assets and liabilities: Accounts receivable (136) — — — Prepaid expenses and other current assets (8,000) — 35 (54) Inventories (7,579) — — — Accounts payable 845 — (150) 85 Accrued expenses 4,611 — (318) 34 Net cash used in operating activities (37,442) — (1,989) (5,759) INVESTING ACTIVITIES SERES Asset Purchase (30,187) — — — Capital expenditures (1,988) — — (23) Net cash used in investing activities (32,175) — — (23) FINANCING ACTIVITIES Change in Predecessor parent's net investment — — 1,989 5,782 Successor paid in capital — 10 — — Repurchase of common stock from related party (61) — — — Proceeds from reverse recapitalization, net of transaction costs 243,769 — — — Payments on land contract and promissory note obligations (28,392) — — — Net cash provided by financing activities 215,316 10 1,989 5,782 Net increase in cash, cash equivalents and restricted cash 145,699 10 — — Cash, cash equivalents and restricted cash —Beginning of period 25,205 — — — Cash, cash equivalents and restricted cash —End of period $ 170,904 $ 10 $ — $ — Reconciliation to condensed consolidated balance sheet: Cash and cash equivalents $ 143,154 Restricted cash 27,750 Total cash, cash equivalents and restricted cash $ 170,904 are an integral part of the unauditedto condensed consolidated financial statements.
See Note 5 Supplemental Cash Flow Information.NOTE
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) DESCRIPTIONNATURE OF ORGANIZATION AND BUSINESS OPERATIONS(the “Company”(“Forum”) was incorporated in Delaware on June 25, 2019. The Company was formed for2019 as a special purpose acquisition company.On June 25, 2021 (the “Closing Date”), Forum consummated the purposepreviously announced transactions contemplated by that certain Agreement and Plan of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. The Company is not limited to a particular industry or sector for purposes of consummating a Business Combination (as defined in Note 6).The Company has one subsidiary,Merger, dated December 10, 2020, by and among Forum, ELMS Merger Corp., a Delaware corporation and then a wholly owned subsidiary of the Company incorporated in Delaware on December 3, 2020Forum (“Merger Sub”).As of March 31, 2021, the Company had not commenced any operations. All activity through March 31, 2021 relates to the Company’s formation, its initial public offering (“Initial Public Offering”), which is described below, identifying a target company for a Business Combination, and activities in connection with the proposed acquisition of Electric Last Mile, Inc., a Delaware corporation (“ELM”), and Jason Luo, in his capacity as the initial shareholder representative to ELM, as amended on May 7, 2021 by Amendment No. 1 to the Agreement and Plan of Merger (as amended, the “Merger Agreement”). The Company generates non-operating incomePursuant to the Merger Agreement, on June 25, 2021, Merger Sub merged with and into ELM, with ELM surviving the merger in accordance with the formDelaware General Corporation Law as a wholly owned subsidiary of interest income from the proceeds derived from the Initial Public Offering.The registration statement for the Company’s Initial Public Offering was declared effective on August 18, 2020. On August 21, 2020 the Company consummated(this transaction and the Initial Public Offering of 25,000,000 units (the “Units” and, with respect toother transactions contemplated by the shares of Class A common stock included inMerger Agreement, collectively, the Units sold, the “Public Shares”“Business Combination”), at $10.00 per Unit, generating gross proceeds of $250,000,000 which is described in Note 3.Simultaneously.Initial Public Offering, the Company consummated the sale of an aggregate of 741,250 units (the “Private Placement Units”) at a price of $10.00 per Private Placement Unit in a private placementBusiness Combination on June 25, 2021, Forum changed its name from “Forum Merger III Corporation” to Forum Investors III LLC, a Delaware limited liability company (the “Sponsor”),“Electric Last Mile Solutions, Inc.” and the underwriters of the Initial Public Offering, generating gross proceeds of $7,412,500, which is described in Note 4.Transaction costs amounted to $14,185,268, consisting of $5,000,000 of underwriting fees, $8,750,000 of deferred underwriting feeCompany’s common stock and $435,268 of other offering costs.Following the closing of the Initial Public Offeringwarrants began trading on August 21, 2020, an amount of $250,000,000 ($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 Units was placed in a trust account (the “Trust Account”) located in the United States and 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 paragraphs (d)(2), (d)(3) and (d)(4) 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 Trust Account, as described below.Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of the Private Placement Units, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. There is no assurance that the Company will be able to complete a Business Combination successfully. The Company must complete one or more Business Combinations having an aggregate fair market value of at least 80% of the value of the assets held in the Trust Account (as defined below) (excluding the deferred underwriting commissions and taxes payable on interest earned on the Trust Account) at the time of the Company’s signing a definitive agreement in connection with its initial Business Combination. The Company will only complete a Business Combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment companyNasdaq Stock Market under the Investment Company Act.The Company will provide its holderstrading symbols “ELMS” and “ELMSW,” respectively.the outstanding Public Shares (the “public stockholders”) with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a stockholder meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek stockholder approval of a Business Combination or conduct a tender offer will be made by the Company, solely in its discretion. The public stockholders will be entitled to redeem their Public Shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account as of two business days prior to the consummation of the initial Business Combination, including interest (which interest shall be net of taxes payable), divided by the number of then outstanding Public Shares, subject to the limitations described below. There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s warrants.EVAP OperationsThe Company will proceed with a Business Combination if the Company has net tangible assets of at least $5,000,001 upon such consummation of a Business Combination and, if the Company seeks stockholder approval, a majority of the shares voted are voted in favor of the Business Combination. If a stockholder vote is not required by applicable law or stock exchange listing requirements and the Company does not decide to hold a stockholder vote for business or other legal reasons, the Company will, pursuant to its Amended and Restated Certificate of Incorporation (the “Amended and Restated Certificate of Incorporation”), conduct the redemptions pursuant to the tender offer rules of the U.S. Securities and Exchange Commission (“SEC”) and file tender offer documents with the SEC prior to completing a Business Combination. If, however, stockholder approval of the transaction is required by applicable law or stock exchange listing requirements, or the Company decides to obtain stockholder approval for business or legal reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer rules. If the Company seeks stockholder approval in connection with a Business Combination, the Company’s Sponsor has agreed to vote its Founder Shares (as defined below in Note 5), its Private Placement Shares (as defined in Note 4) and any Public Shares acquired by it during or after the Initial Public Offering in favor of approving a Business Combination. Additionally, each public stockholder may elect to redeem their Public Shares irrespective of whether they vote for or against the proposed transaction.If the Company seeks stockholder approval of a Business Combination and it does not conduct redemptions pursuant to the tender offer rules, the Amended and Restated Certificate of Incorporation provides that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming its shares with respect to more than an aggregate of 15% or more of the Public Shares, without the prior consent of the Company.The Sponsor has agreed (a) to waive its redemption rights with respect to its Founder Shares, Private Placement Shares and Public Shares held by itathe Business Combination, and (b) not to propose an amendment to the Amended and Restated Certificate of Incorporation (i) that would affect the substance or timingELM completed its acquisition of the Company’s obligationMishawaka, Indiana manufacturing facility (the “ELMS Facility”), which comprises the Electric Vehicle Assembly Plant Operations (“EVAP Operations”).EVAP Operations was a wholly owned component of SF Motors, Inc. (d/b/a SERES) (“SERES”) primarily consisting of the ELMS Facility retooled to redeem 100% of its Public Shares ifmanufacture electric passenger vehicles. This acquisition is also referred to as the Company does not complete a Business Combination or (ii) with respect to any other material provisions relating to stockholders’ rights or pre-initial Business Combination activity, unless the Company provides the public stockholders“SERES Asset Purchase” in this report. Concurrently with the opportunity to redeem their Public Shares in conjunction with any such amendment.If the Company is unable to complete a Business Combination by August 21, 2022 (the “Combination Period”), the Company will (i) cease all operations exceptacquisition of EVAP Operations, ELM also entered into agreements for the purposeability to use certain intellectual property of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeemSERES, procure the Public Shares, at a per-share price, payable in cash, equalsupply of inventory from Chongqing Sokon Motor (Group) Imp. & Exp. Co., Ltd. (“Sokon”), an affiliate of SERES, and other arrangements consisting of know-how to manufacture electric commercial vehicles for the aggregate amount then on deposit in the Trust Account including interest not previously released to the Company to pay its franchise and income taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding Public Shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining stockholders and the Company’s board of directors, dissolve and liquidate, subject in each case to the Company’s obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. 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 and Private Placement Shares if the Company fails to complete a Business Combination within the Combination Period. However, if the Sponsor acquires Public Shares in or after the Initial Public Offering, such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination within the Combination Period. The underwriters have agreed to waive their rights to their deferred underwriting commission (see Note 6) held in the Trust Account in the event the Company does not complete a Business Combination within in 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 ifNorth American region and to operate the extent any claims byEVAP Operations on a third party for services rendered or products sold to the Company, or a prospective target business with which the Company has entered into a written letter of intent, confidentiality or similar agreement or business combination agreement, reduce the amount of funds in the Trust Account to below the lesser of (i) $10.00 per Public Share and (ii) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account, if less than $10.00 per Public Share due to reductions in the value of the trust assets, less taxes payable. This liability will not apply with respect to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the Trust Account nor will it apply to any claims under the Company’s indemnity of the underwriters of the Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers (except the Company’s independent registered public accounting firm), prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account.Liquidity and Going ConcernAs of March 31, 2021, the Company had approximately $1.0 million in cash in its operating bank accounts, and a working capital deficit of approximately $2.6 million.In connection with the Company’s assessment of going concern considerations in accordance with Financial Accounting Standard Board’s Accounting Standards Update (“ASU”) 2014-15, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” the Company has determined that the liquidity condition raises substantial doubt about the Company’s ability to continue as a going concern. The Company will need to raise additional capital through loans or additional investments from its Sponsor, stockholders, officers, directors, or third parties. The Company’s officers, directors and Sponsor may, but are not obligated to, loan the Company funds, from time to time or at any time, in whatever amount they deem reasonable in their sole discretion, to meet the Company’s working capital needs. Accordingly, the Company may not be able to obtain additional financing. If the Company is unable to raise additional capital, it may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending the pursuit of a potential transaction, and reducing overhead expenses. The Company cannot provide any assurance that new financing will be available to it on commercially acceptable terms, if at all. standalone basis.conditions raise substantial doubt about the Company’s ability to continue as a going concern through one year from the date of these financial statements if a Business Combination is not consummated. These financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESBasis of PresentationThe accompanyingunaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission and accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financialreporting. Accordingly, certain notes or other 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 disclosuresthat are normally included in financial statements prepared in accordance withrequired by U.S. GAAP have been condensed or omitted pursuant toif they substantially duplicate the rules and regulations ofdisclosures contained in 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 condensedCompany’s annual audited consolidated financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation ofstatements. Accordingly, the financial position, operating results and cash flows for the periods presented.The accompanying unaudited condensed consolidated financial statements should be read in conjunctionconnection with the Company’s Annual Report on 10-K/Aaudited financial statements and related notes as filed with the SEC on May 7, 2021. The interim results for the three months ended March 31, 2021 are not necessarily indicative of the results to be expectedand for the year endingended December 31, 2021 or for any future interim periods.Principles of Consolidationsubsidiary. All significant intercompanysubsidiary of the Company.Increase
(Decrease)$ 250,258 (110,772) 130,000 (25,717) Net change in cash and cash equivalent and restricted cash as a result of recapitalization 243,769 17 (326) (20,392) Change in net assets as a result of recapitalization $ 223,068 Number of Shares 31,991,250 (11,077,058) 13,000,000 77,110,597 111,024,789 2,752,223 5,000,000 Common shares outstanding after the Business Combination and SERES Asset Purchase 118,777,012 transactionsoutstanding shares of Forum as of the Closing Date immediately prior to the consummation of the Business Combination. The Forum common shares consisted of all Class A redeemable and nonredeemable common shares and Class B common shares outstanding prior to the Business Combination.eliminatedissued. The Company has determined the Earnout Shares meet the criteria for equity classification under the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 815-40. Upon attainment of the share price targets described above, the Earnout Shares delivered to the ELM shareholders will be recorded in consolidation.Description Land Contract
ObligationPromissory Note Total Payments Total principal payments under Land Contract and Promissory Note $ 90,000 $ 55,000 $ 145,000 Less payments at closing (18,621) (11,379) (30,000) Remaining principal payments at closing $ 71,379 $ 43,621 $ 115,000 Purchase Price $ 112,436 30,187 5,012 49,950 Total $ 197,585 Assets Identified
Fair ValueLand $ 1,859 Buildings 113,893 Machinery and equipment 72,602 Site improvements 1,202 Leasehold improvements 1,894 Intellectual property and technology license intangible asset 5,948 Other assets 300 Fair value of pension obligation (113) Total $ 197,585 Nine Months Ended September 30, 2021 Capital expenditures included in accounts payable $ 377 Noncash investing intangible and other assets included in other long-term liabilities 2 Noncash financing conversion of ELM Convertible Notes 27,522 Noncash investing SERES Asset Purchase in accounts payable 5,012 Noncash investing SERES Asset Purchase assumption of pension obligation 113 Noncash financing and investing SERES Asset Purchase issuance of Promissory Note 42,824 Noncash financing and investing SERES Asset Purchase issuance of Land Contract obligation 69,612 Noncash financing and investing SERES Asset Purchase issuance of common stock 49,950 modified byamended (the "Securities Act"). Section 102(b)(1) of the Jumpstart Our Business Startups Act of 2012 (the “JOBS(“JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not exempts 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 of 2002, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies(“EGC”) 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 companiesnon-EGCs 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,EGC, can adopt the new or revised standard at the time private companies adopt the new or revised standard, until such time the Company is no longer considered to be an EGC. At times, the Company may elect to early adopt a new or revised standard. This may make the comparison of the Company’s consolidated financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of thedue to potential differences in accounting standards used.UseEstimatespreparationCompany does not have any significant financing components as payment is received shortly after point of unaudited condensed consolidated financial statementssale. Because customer contract contains only one performance obligation that is satisfied at a point in conformitytime, there are no satisfied performance obligations that would result in contract assets other than trade accounts receivable.GAAP requiresan original maturity of three months or less when purchased to be cash equivalents. Cash includes cash equivalents which are highly liquid investments that are readily convertible to cash. Money market funds are valued at the closing price reported by the fund sponsor from an actively traded exchange and are included in cash equivalents.managementcash and cash equivalents are placed in accounts that exceed federally insured limits as of September 30, 2021 and December 31, 2020. The Company has not experienced any credit loss related to make estimatesits cash and assumptionscash equivalents.Years Buildings 39 Machinery and equipment 7* Vehicles 5 Computer hardware 3 Furniture and fixtures 3 Site improvements 15 Leasehold improvements 3-10 affect the reportedcarrying amount of such assets may not be recoverable. When such events occur, the Company will compare the carrying amounts of the assets to their undiscounted expected future cash flows. If the Company determines that the carrying value of the asset is not recoverable, a permanent impairment charge is recorded for the amount by which the carrying value of the long-lived asset exceeds its fair value. When a long-lived asset is disposed, the related costs and accumulated depreciation or amortization are removed and any gain or loss on the disposal is recorded.disclosure of contingentthe respective tax values, and net operating losses and tax credit carryforwards on a tax jurisdiction basis. Deferred tax assets and liabilities atare measured using enacted tax rates that will apply in the date ofyears in which the unaudited condensed consolidated financial statementstemporary differences are expected to be recovered or paid. The effect on deferred tax assets and the reported amounts of revenues and expenses during the reporting periods. One of the more significant accounting estimates included in these financial statements is the determination of the fair value of the warrant liabilities.Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effectliabilities of a condition, situation or set of circumstances that existed at the date of the unaudited condensed consolidated financial statements, which management considered in formulating its estimate, could change in tax rates is recorded in the near term dueresults of operations in the period that includes the enactment date under the law. Valuation allowances are established when necessary to one or more future confirming events. Accordingly,reduce deferred tax assets to the actual results could differ significantly from those estimates.Class A Common Stock Subjectamount expected to Possible Redemptionaccountsbelieves that its income tax filing positions and deductions will be sustained on audit and does not anticipate any adjustments that will result in a material adverse effect on its combined financial position, results of operations or cash flows. Therefore, no reserves for uncertain tax positions have been recorded. The Company does not expect its Class A common stock subjectunrecognized tax benefits to possible redemption in accordance withchange significantly over the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Class A common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at March 31, 2021 and December 31, 2020, Class A common stock subject to possible redemption is presented as temporary equity, outside of the stockholders’ equity section of the Company’s condensed consolidated balance sheets.Offering CostsOffering costs consisted of legal, accounting, underwriting fees and other that were directly related to the Initial Public Offering. Offering costs were allocated on a relative fair value basis between stockholders’ equity and expense. The portion of offering costs allocated to the public warrants has been charged to expense. The portion of offering costs allocated to the public shares has been charged to stockholders’ equity. Offering costs amounted to $14,185,268, of which $13,949,056 were charged to stockholders’ equity upon the completion of the Initial Public Offering on August 21, 2020 and $236,212 were expensed to the condensed consolidated statements of operations.Public Warrants (as defined in Note 3) and Private Placement Warrants (as defined in Note 4) (collectively, the “Warrants”)warrants in accordance with the guidance contained in ASC 815-40 under which the Warrantswarrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the Warrantswarrants as liabilities at their fair value and adjustadjusts the Warrantswarrants 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 statement of operations. The Private 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 Warrantspublic warrants from the Units,units issued in the Public WarrantForum's initial public offering, the public warrant quoted market price was used as the fair value of the warrants as of each relevant date.Income Taxesfollows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. As of March 31, 2021 and December 31, 2020, the Company had a deferred tax asset of approximately $1,166,000 and $900,000, respectively, which had a full valuation allowance recorded against it of approximately $1,166,000 and $900,000, respectively.The Company’s currently taxable income primarily consists of interest income on the Trust Account. The Company’s general and administrative costs are generally considered start-up costs and are not currently deductible. During the three months ended March 31, 2021, the Company recorded no income tax expense. The Company’s effective tax rate for the three months ended March 31, 2021 was zero, which differs from the expected income tax rate due to the start-up costs (discussed above) which are not currently deductible and permanent differences due to the change in the fair value of the warrant liabilities. The provision for income taxes was deemed to be de minimis for the three months ended March 31, 2020.ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of March 31, 2021 and December 31, 2020. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception.Net Income (Loss) Per Common ShareNet incomecomputes basic earnings (loss) per common share is computed by dividing net income (loss)available to common shareholders by the weighted average number of common shares outstanding foroutstanding. As a result of the periods.The Company’s unaudited condensed consolidated statements of operations includes a presentation of income (loss) per share for common shares subject to possible redemption in a manner similar toBusiness Combination, the two-class method of income (loss) per share. Net income per common share, basic and diluted, for Class A redeemable common stock is calculated by dividing the interest income earned on the Trust Account, byCompany has retrospectively adjusted the weighted average number of Class A redeemable common stockshares outstanding since original issuance. Net incomeprior to the Business Combination by multiplying them by the merger exchange ratio. The computation of diluted earnings (loss) per share is similar to the computation of basic for Class A and B non-redeemable common stock is calculated by dividingearnings (loss) per share, except the net loss, adjusted for income attributable to Class A redeemable common stock, byCompany adjusts the weighted average number of Class Ashares outstanding to include estimates of additional shares that would be issued if potentially dilutive common shares had been issued. In addition, the Company adjusts income (loss) available to common shareholders to include any changes in income or loss that would result from the assumed issuance of the dilutive common shares. For the three and B non-redeemablenine months ended September 30, 2021, there were no dilutive potential common stock outstandingshares due to the fact that the average share price during the periods was lower than the strike price of the warrants, the contingent share price thresholds for the period. Share settlement ofEarnout Shares were not met during the Company's warrants to purchase an aggregate of 8,580,416 shares of Class A common stock at a price of $11.50 was presumed for the calculation of diluted earnings per share because it is more dilutive than the cash settlement alternative. Under this assumption, the contract is settled in common shares,periods, and the effect of including outstanding RSUs would have an anti-dilutive effect.classification (change in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. Fair value measurements for assets or liabilities required to measured or disclosed at fair value are classified and disclosed in one of derivative warrant liabilitythe following three categories:Quoted prices in active markets for identical assets or liabilities Observable inputs other than Level 1 prices, for similar assets or liabilities that are directly or indirectly observable in the marketplace. Unobservable inputs which are supported by little or no market activity and that are financial instruments whose values are determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation. The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. reversed as a numerator adjustment)service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). Potentially dilutive weighted average sharesASU 2018-15 is effective for annual periods beginning after December 15, 2020 and interim periods within those annual periods beginning after December 31, 2021, with early adoption permitted. The amendments in this ASU should be applied either retrospectively or prospectively to all implementation costs incurred after the date of 161,066 are included inadoption. The Company early adopted ASU 2018-15 effective April 1, 2021. As the denominator. Class A and B non-redeemable common stock includes the Founder Shares and Private Placement Shares as these shares do not have any redemption features and do not participate in the income earnedCompany had no implementation costs incurred related to a cloud computing arrangement prior to that date, there was no impact on the Trust Account.The following table reflectsretrospective periods. For the calculation of basic and diluted net income (loss) per common share (in dollars, except per share amounts): Three Months Ended March 31 2021 2020 Redeemable Class A Common Stock Numerator: Earnings allocable to Redeemable Class A Common Stock Interest Income $ 6,166 $ — Income and Franchise Tax (6,166 ) — Net Earnings $ — $ — Denominator: Weighted Average Redeemable Class A Common Stock Redeemable Class A Common Stock, Basic and Diluted 25,000,000 — Earnings/Basic and Diluted Redeemable Class A Common Stock $ — $ — Non-Redeemable Class A and B Common Stock Basic Income (Loss) per Share Numerator: Net loss minus Redeemable Net Earnings Net income (loss) $ 12,486,665 $ (160 ) Net Earnings applicable to Redeemable Class A and B Common Stock — — Non-Redeemable Net Income (Loss) $ 12,486,665 $ (160 ) Denominator: Weighted Average Non-Redeemable Class A and B Common Stock Class A and B Non-Redeemable Common Stock, Basic and Diluted (1) 6,991,250 6,250,000 Income (Loss)/Basic and Diluted Non-Redeemable Class A and B Common Stock $ 1.79 $ (0.00 ) Diluted Loss per Share Numerator: Non-Redeemable Net Income - Basic minus Change in fair value of warrant liabilities Non-Redeemable Net Income - Basic $ 12,486,665 $ (160 ) Less: Change in fair value of warrant liabilities (13,534,820 ) — Non-Redeemable Net Loss – Diluted $ (1,048,155 ) $ (160 ) Denominator: Weighted Average Non-Redeemable Class A and B Common Stock Class A and B Non-Redeemable Common Stock, Diluted (2) 7,152,316 6,250,000 Loss/Diluted Non-Redeemable Class A and B Common Stock $ (0.15 ) $ (0.00 ) (1)The weighted average non-redeemable common stock for the three months ended March 31,three months ended September 30, 2021, includes the effect of 741,250 Private Placement Units, which were issued in conjunction with the Initial Public Offering in August 2020.(2)As of March 31, 2021, diluted weighted average shares outstanding was calculated using the treasury stock method utilizing a weighted average share price of $11.72 and the effect of the warrants sold in the Initial Public Offering and the private placement to purchase an aggregate of 8,580,416 shares of common stock.Concentration of Credit RiskFinancial instruments that potentially subject the Company capitalized $0.2 million of development cost related to concentrationsa SAP cloud computing arrangement that will be amortized over the noncancellable service contract period of credit risk consist of a cash accountfive years beginning in a financial institution, which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on this account and management believes the Company is not exposed to significant risks on such account.Fair Value of Financial InstrumentsThe fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying condensed consolidated balance sheets, primarily due to their short-term nature.RecentJune 2021.StandardsAugust 2020,February 2016, the FASB issued ASU No. 2020-06, ”Debt—Debt with Conversion2016-02, “Leases (Topic 842).” Under the new guidance, lessees will be required to recognize the following for all leases (with the exception of short term leases) at the commencement date: (1) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in(2) a right of use asset, which is an Entity’s Own Equity” (“ASU 2020-06”), which simplifies accounting for convertible instruments by removing major separation models required under current GAAP. ASU 2020-06 removes certain settlement conditionsasset that are required for equity contractsrepresents the lessee’s right to qualifyuse, or control the use of, a specified asset for the derivative scope exception and it also simplifies the diluted earnings per share calculationlease term. The amendments in certain areas.this ASU 2020-06 isare effective for fiscal years beginning after December 15, 2023, including interim2021. Additionally, in July 2018, the FASB issued ASU 2018-11, Leases: Targeted Improvements (“ASU 2018-11”), which provided an alternate transition method by allowing entities to initially apply the new lease standard at the adoption date and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The adoption of the standard will impact the balance sheet requiring the Company to record an operating lease liability for the present value of the remaining lease payments on the date of transition and a right-of-use assetthosethis ASU are required to be applied on a prospective basis, while certain amendments must be applied on a retrospective or modified retrospective basis. The Company does not expect this standard to have a material impact on its financial statements.adopted ASU 2020-06 effective as of January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company’s financial statements.Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, wouldexpect this standard to have a material effectimpact on the Company’s condensed consolidatedits financial statements.NOTE 3. INITIAL PUBLIC OFFERINGPursuantSuccessor Predecessor September 30, 2021 December 31, 2020 Construction in progress: Buildings $ — $ 83,445 Machinery and equipment 71,220 47,000 Total construction in progress 71,220 130,445 Buildings 113,893 — Land 1,859 1,243 Site Improvements 1,203 — Leasehold improvements 1,906 — Machinery and equipment 2,345 247 Computer hardware 339 — Furniture and fixtures 201 37 Vehicles 188 42 Subtotal 193,154 132,014 Accumulated depreciation (418) (106) Net property, plant and equipment $ 192,736 $ 131,908 Initial Public Offering,periods presented was as follows (in thousands):Successor Predecessor Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021 For the
period from
August 20, 2020 through September 30, 2020Three Months Ended September 30, 2020 For the
period from
January 1, 2021
through
June 25, 2021Nine Months Ended September 30, 2020 $ 384 $ 418 $ — $ 12 $ 23 $ 35 sold 25,000,000 Units, at a price of $10.00 per Unit. Each Unit consists of one share of Class A common stock and one-third of one redeemable warrant (“Public Warrant”). Each whole Public Warrant entitles the holder to purchase one share of Class A common stock at a price of $11.50 per share, subject to adjustment (see Note 7).NOTE 4. PRIVATE PLACEMENTSimultaneouslycommenced an operating lease for an office building that will expire on December 31, 2023. In conjunction with the closing of the Initial Public Offering,SERES Asset Purchase on June 25, 2021, the SponsorCompany entered into a sublease for the land adjacent to the ELMS Facility, which functions as a parking lot for the ELMS Facility. Operating lease expense for the periods presented was as follows (in thousands):Successor Predecessor Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021 For the
period from
August 20, 2020 through September 30, 2020Three Months Ended September 30, 2020 For the
period from
January 1, 2021
through
June 25, 2021Nine Months Ended September 30, 2020 $ 85 $ 208 $ — $ 18 $ 35 $ 54 Successor September 30, 2021 December 31, 2020 IP license intangible $ 5,948 $ — Favorable lease intangible 151 — Computer software and website development costs 96 39 Subtotal 6,195 39 Accumulated amortization (813) (1) Intangible assets, net 5,382 38 Service contract asset, net 742 — Intangible and other assets, net $ 6,124 $ 38 underwriters purchasedPromissory Note has a stated interest rate of 0.13% and both mature on April 30, 2023. The fair value of the obligations on the date of closing (June 25, 2021) were determined to be $112.4 million with an aggregateeffective interest rate of 741,250 Private Placement Units at a price2.67%. The required principal payments under the obligations as of $10.00 per Private Placement Unit, for an aggregate purchase priceSeptember 30, 2021 were as follows (in thousands):Description Land Contract
ObligationPromissory
NoteTotal Payments 19 Consecutive equal monthly installments through April 30, 2023 $ 3,103 $ 1,420 $ 4,523 Total principal payments under Land Contract and Promissory Note $ 58,965 $ 26,987 $ 85,952 Fair value at inception $ 69,612 $ 42,824 $ 112,436 $7,412,500. The Sponsor purchased 616,250 Private Placement Units andSeptember 30, 2021 were as follows (in thousands):Land Contract
ObligationPromissory
NoteTotal Carrying Value Carrying value as of September 30, 2021 $ 57,658 $ 26,428 $ 84,086 Less current portion due in next 12 months (37,242) (17,044) (54,286) Noncurrent $ 20,416 $ 9,384 $ 29,800 underwriters purchased 125,000 Private Placement Units. Each Private Placement Unit consists of one share of Class A common stock (“Private Placement Share”) and one-third of one warrant (each, a “Private Placement Warrant”). Each Private Placement Warrant is exercisableholder thereof to purchase one1 share of Class A common stock at an exercise price of $11.50 per share, subject to adjustment.share. As of September 30, 2021, there were 8,580,375 warrants outstanding consisting of 8,396,673 public warrants, which were included in the units issued in Forum's initial public offering ("Public Warrants"), and 183,702 private placement warrants, which were included in the units issued in the concurrent private placement at the time of Forum's initial public offering ("Private Placement Warrants" and, collectively with the Public Warrants, the "warrants"). The proceeds fromPublic and Private Placement Warrants were accounted for as liabilities and are presented as warrant liabilities on the salecondensed consolidated balance sheets. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value of warrant liabilities in the condensed consolidated statement of operations. The measurements of the Private Placement Unitswarrants 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 Units held in the Trust Account will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law), and the Private Placement Units and all underlying securities will expire worthless.NOTE 5. RELATED PARTY TRANSACTIONSFounder SharesOn June 26, 2019, the Sponsor purchased 5,750,000 shares of the Company’s Class B common stock (the “Founder Shares”) for an aggregate price of $25,000. On July 1, 2020, the Company effected a stock split of 1:1.25 with respect to the Class B common stock, resulting in the Sponsor holding an aggregate of 7,187,500 Founder Shares.The Founder Shares included an aggregate of up to 937,500 shares of Class B common stock subject to forfeiture by the Sponsor to the extent that the underwriters’ over-allotment was not exercised in full or in part, so that the Sponsor would own,based on an as-converted basis, 20% of the Company’s issued and outstanding shares after the Initial Public Offering (assuming the Sponsor does not purchase any Public Shares in the Initial Public Offering and excluding the Private Placement Shares). On October 5, 2020, the underwriters’ over-allotment option expired unexercised, resulting in the forfeiture of 937,500 shares. Accordingly, as of October 5, 2020, there are 6,250,000 Founder Shares issued and outstanding (see Note 7).The Sponsor has agreed, subject to certain limited exceptions, not to transfer, assign or sell any of its Founder Shares until the earlier to occur of: (A) one year after the completion of a Business Combination or (B) subsequent to a Business Combination, (x) if the closing price of the Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after a Business Combination, or (y) the date on which the Company completes a liquidation, merger, capital stock exchange or other similar transaction that results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property.Administrative Support AgreementThe Company entered into an agreement, commencing on August 19, 2020, to pay an affiliate of the Sponsor a total of $25,000 per month for 24 months for office space, utilities and secretarial and administrative support. Such payments will be accelerated if the Company consummates its initial Business Combination prior to the end of its 24-month term, or $600,000 in the aggregate. For the three months ended March 31, 2021, the Company incurred and paid $75,000 in fees for these services.Related Party LoansOn June 26, 2019, as amended on July 2, 2020, the Sponsor agreed to loan the Company an aggregate of up to $300,000 to cover expenses related to the Initial Public Offering pursuant to a promissory note (the “Promissory Note”). The Promissory Note was non-interest bearing and payable on the earlier of December 31, 2020 or the completion of the Initial Public Offering. The outstanding balance under the Promissory Note of $40,000 was repaid at the closing of the Initial Public Offering on August 21, 2020.In addition, in order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,200,000 of such Working Capital Loans may be convertible into units of the post Business Combination entity at a price of $10.00 per unit. The units would be identical to the Private Placement Units. As of March 31, 2021 and December 31, 2020, no Working Capital Loans were outstanding.NOTE 6. COMMITMENTS AND CONTINGENCIESRisks and UncertaintiesManagement 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 close of a business combination, the specific impact is not readily determinableWarrants as of the date of these financial statements. September 30, 2021. financial statements do not include any adjustments that might result from the outcome of this uncertainty.Registration RightsPursuant to a registration rights agreement entered into on August 18, 2020, the holders of the Founder Shares (including any shares of Class A common stock issuable upon conversion of the Founder Shares), Private Placement Units, Private Placement Shares, Private Placement Warrants (and any shares of Class A common stock issuable upon the exercise of the Private Placement Warrants), and securities that may be issued upon conversion of Working Capital Loans are entitled to registration rights requiring the Company to register such securities for resale (in the case of the Founder Shares, only after conversion to Class A common stock). Certain holders of these securities will be entitled to make up to three demands, excluding short form demands, that the Company register such securities for sale under the Securities Act. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of a Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. Notwithstanding the foregoing, the underwriters may not exercise their demand and “piggyback” registration rights after five and seven years after the effective date of the registration statement related to the Initial Public Offering and may not exercise their demand rights on more than one occasion. The Company will bear the expenses incurred in connection with the filing of any such registration statements.Underwriting AgreementThe Company granted the underwriters a 45-day option from the date of the Initial Public Offering to purchase up to 3,750,000 additional Units to cover over-allotments, if any, at the Initial Public Offering price less the underwriting discounts and commissions. On October 5, 2020, the underwriters’ over-allotment option expired unexercised.The underwriters are entitled to a deferred fee of $0.35 per Unit, or $8,750,000 in the aggregate. The deferred fee will be forfeited by the underwriters solely in the event that the Company fails to complete a Business Combination, subject to the terms of the underwriting agreement. Merger AgreementOn December 10, 2020, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Merger Sub, ELM, and Jason Luo, in the capacity as the initial stockholder representative thereto, pursuant to which, subject to the satisfaction or waiver of certain conditions set forth therein, Merger Sub will merge with and into ELM (the “Merger”), with ELM surviving the merger in accordance with the Delaware General Corporation Law as a wholly owned subsidiary of the Company (the transactions contemplated by the Merger Agreement and the related ancillary agreements, the “Business Combination”). The Business Combination is subject to certain closing conditions, including the Carveout Transaction (as defined in the Merger Agreement). Prior to the Carveout Transaction, ELM will have limited operations.The aggregate consideration payable to the stockholders of ELM at the closing of the Business Combination (the “Closing”) is $1,300,000,000, payable solely in shares of the Company’s common stock, par value $0.0001 per share (“Common Stock”), valued at $10.00 per share, subject to the purchase price adjustments and deductions as set forth in the Merger Agreement less $292,000,000, the value of the 29,200,000 shares of Common Stock reserved for a new long-term equity incentive plan ($150,000,000 of which are restricted share units with vesting terms substantially similar to the Earnout Shares (as defined below)), less $2,500,000, the value of the Adjustment Escrow Stock (as defined below), and less $50,000,000, the value of the Earnout Shares (the “Closing Merger Consideration”).In addition, an aggregate of 5,000,000 shares of Common Stock (the “Earnout Shares”) will be placed into escrow at Closing and will be payable to ELM stockholders (the “ELM Stockholders”) during the 36-month period following the Closing (the “Earnout Period”) as follows: (i) if the closing price of the Common Stock (the “Closing Price”) equals or exceeds $14.00 on any 20 trading days in any 30-consecutive-day trading period, then 2,500,000 Earnout Shares will be released from escrow to the ELM Stockholders, and (ii) if the Closing Price equals or exceeds $16.00 on any 20 trading days in any 30-consecutive-day trading period, then the remaining 2,500,000 Earnout Shares will be released from escrow to the ELM Stockholders. Subject to the terms and conditions set forth in the Merger Agreement, if a qualifying Change in Control (as defined in the Merger Agreement) occurs during the Earnout Period, all Earnout Shares not previously released will be released to the ELM Stockholders. Any Earnout Shares not released prior to the expiration of the Earnout Period will be forfeited and cancelled.The Company has agreed that, at the Closing, the Company will place 250,000 shares of Common Stock into an adjustment escrow account (the “Adjustment Escrow Stock”) to secure any downward post-closing purchase price adjustment. Following the date on which the Closing Merger Consideration is finally determined, all or a portion of those shares of Common Stock will either be released to the ELM Stockholders or released to the Company in accordance with the adjustment mechanisms set forth in the Merger Agreement.The Merger Agreement contains customary representations, warranties and covenants by the parties thereto and the closing is subject to certain conditions as further described in the Merger Agreement.NOTE 7. STOCKHOLDERS’ EQUITYPreferred Stock — The Company is authorized to issue 1,000,000 shares of preferred stock with a par value of $0.0001 per share with such designations, voting and other rights and preferences as may be determined from time to time by the Company’s board of directors. At March 31, 2021 and December 31, 2020, there were no shares of preferred stock issued or outstanding.Class A Common Stock — The Company is authorized to issue 100,000,000 shares of Class A common stock with a par value of $0.0001 per share. Holders of Class A common stock are entitled to one vote for each share. At March 31, 2021 and December 31, 2020, there were 4,008,604 and 5,257,271 shares of Class A common stock issued and outstanding, excluding 21,732,646 and 20,483,979 Class A common stock subject to possible redemption, respectively.Class B Common Stock — The Company is authorized to issue 10,000,000 shares of Class B common stock with a par value of $0.0001 per share. Holders of Class B common stock are entitled to one vote for each share At March 31, 2021 and December 31, 2020, there were 6,250,000 shares of Class B common stock issued and outstanding, respectively.Holders of Class A common stock and Class B common stock will vote together as a single class on all matters submitted to a vote of stockholders, except as required by law.The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of the consummation of a Business Combination on a one-for-one basis, subject to adjustment for stock splits, stock dividends, reorganizations, recapitalizations and the like, and subject to further adjustment. In the case that additional shares of Class A common stock or equity-linked securities, are issued or deemed issued in excess of the amounts offered in the Initial Public Offering and in connection with the closing of a Business Combination, the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 25% of the sum of the total number of all shares of Class A common stock outstanding after such conversion (after giving effect to any redemptions of shares of Class A common stock by public stockholders and excluding the shares of Class A common stock underlying the Private Placement Units), including the total number of shares of Class A common stock issued, or deemed issued or issuable upon conversion or exercise of any equity-linked securities or rights issued or deemed issued, by the Company in connection with or in relation to the consummation of a Business Combination, excluding any shares of Class A common stock or equity-linked securities or rights exercisable for or convertible into shares of Class A common stock issued, or to be issued, to any seller in a Business Combination or any private placement-equivalent units issued to the Sponsor, its affiliates or certain of the Company’s officers and directors upon conversion of Working Capital Loans made to the Company, provided that such conversion of the shares of Class B common stock will never occur on a less than one-for-one basis.NOTE 8. WARRANT LIABILITIESAs of March 31, 2021, there were 8,580,416 Warrants outstanding. Public Warrants may only be exercised for a whole number of shares. No fractional warrants will bewere issued upon separation of the Unitsunits issued in the initial public offering into their component parts of Public Warrants and only whole warrants will trade.shares of common stock. The Public Warrants will becomebecame exercisable on the later of (a) 12 months from the closing of the Initial Public Offering and (b) 30 days after the completion of a Business Combination.The Company will not be obligated to deliver any shares of Class A common stock pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise unless a registration statement under the Securities Act with respect to the issuance of the shares of Class A common underlying the warrants is then effective and a current prospectus relating thereto is current, subject to the Company satisfying its obligations with respect to registration. No warrant will be exercisable and the Company will not be obligated to issue any shares of Class A common stock upon exercise of a warrant unless the Class A common stock issuable upon such warrant exercise has registered, qualified or deemed to be exempt under the securities laws of the state of residence of the registered holder.The Company has agreed that as soon as practicable, but in no event later than 15 business days after the closing of a Business Combination, it will use its commercially reasonable efforts to file with the SEC a registration statement registering the issuance, under the Securities Act, of the shares of Class A common stock issuable upon exercise of the warrants. The Company will use its commercially reasonable efforts to cause the same to become effective and to maintain the effectiveness of such registration statement and a current prospectus relating thereto, until the expiration of the warrants in accordance with the provisions of the warrant agreement. If a registration statement covering the shares of Class A common stock issuable upon exercise of the warrants is not effective by the 60th business day after the closing of a Business Combination, warrant holders may, until such time as there is an effective registration statement and during the period when the Company will have failed to maintain an effective registration statement, exercise the warrants on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act or another exemption. Notwithstanding the above, if the Class A common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of 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 reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available.��Class A common stock equals or exceeds $18.00$18. Once the warrants become exercisable, theThe Company may redeem the outstanding warrants (except with respect to the Private Placement Warrants):●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● Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like and for certain issuances of Class A common stock and equity-linked securities as described below) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date the Company sends the notice of redemption to the warrant holders.If and when the warrants become redeemable by the Company it may exercise itssends the notice of redemption right even ifto the Company is unable to register or qualify the underlying securities for sale under all applicable state securities laws.Class A common stock equals or exceeds $10.00. Once the warrants become exercisable, theThe 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, based on the redemption date and the fair market value of the Class A common stock;●if, and only if, the closing price of the Class A common stock equals or exceeds $10.00 per share (as adjusted per stock splits, stock dividends, reorganizations, reclassifications, recapitalizations and the like) for any 20 trading days within the 30-trading day period ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant holders; and●if the closing price of the Class A common stock for any 20 trading days within the 30-trading day period ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant holders is less than $18.00 per share (as adjusted per stock splits, stock dividends, reorganizations, reclassifications, recapitalizations and the like), the Private Placement Warrants must also be concurrently called for redemption on the same terms as the outstanding Public Warrants, as described above.agreement.agreement between the Company and Continental Stock Transfer & Trust Company. The exercise price and number of shares of common stock issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, or recapitalization, reorganization, merger or consolidation. However, except as described below, theThe warrants will not be adjusted for the issuance of common stock at a price below itsthe exercise price.price of the warrants Additionally, in no event will the Company be required to net cash settle the warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with the respect to such warrants. Accordingly, the warrants may expire worthless.In addition, if (x) the Company issues additional shares of Class A common stock or equity-linked securities for capital raising purposes in connection with the closing of a Business Combination at an issue price or effective issue price of less than $9.20 per share of Class A common stock (with such issue price or effective issue price to be determined in good faith by the Company’s board of directors, and, in the case of any such issuance to the Sponsor or its affiliates, without taking into account any Founder Shares held by the Sponsor or such affiliates, as applicable, prior to such issuance) (the “Newly Issued Price”), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of a Business Combination on the date of the consummation of a Business Combination (net of redemptions), and (z) the volume weighted average trading price of the common stock during the 20 trading day period starting on the trading day after the day on which the Company consummates a Business Combination (such price, the “Market Value”) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, 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.The Private Placement Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Placement Warrants and the shares of common stock issuable upon the exercise of the Private Placement Warrants will not be transferable, assignable or saleable until 30 days after the completion of a Business Combination, subject to certain limited exceptions, and will be entitled to certain registration rights (see Note 6). Additionally, theexercise.transferees (except for a number of shares of Class A common stock as described above under Redemption of warrants when the price per share of Class A common stock equals or exceeds $10.00).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 in all redemption scenarios and exercisable by such holders on the same basis as the Public Warrants.NOTE 9. FAIR VALUE MEASUREMENTSSuccessor Predecessor Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021 For the
period from
August 20, 2020 through September 30, 2020Three Months Ended September 30, 2020 For the
period from
January 1, 2021
through
June 25, 2021Nine Months Ended September 30, 2020 Service cost $ 8 $ 9 $ — $ 12 $ 16 $ 37 Interest cost 1 1 — — 2 1 Expected return on plan assets — — — — — — Net periodic costs $ 9 $ 10 $ — $ 12 $ 18 $ 38 Three Months Ended September 30, 2020 For the
period from
January 1, 2021
through
June 25, 2021Nine Months Ended September 30, 2020 Non-union 401(k) $ 1 $ 22 $ 29 Union 401(k) 1 2 5 Defined contribution plan expense $ 2 $ 24 $ 34 Company’s financial assetsmarket condition RSUs is recognized as compensation expense over the greater of the Monte Carlo simulation model’s derived service period and liabilities reflects management’s estimate of amounts thatthe arrangement’s explicit service period, assuming both conditions must be met.would have receivedgranted 14,148,000 in connection withEarnout RSUs that entitle the saleholder to receive half of the assets or paid in connection with the transfercommon shares of the liabilitiesCompany granted if, during a 36-month period, the closing price of the common stock for any 20 trading days in an orderly transaction betweenany 30 consecutive day trading period exceeds $14.00 and the other half of the common shares of the Company granted if, during a 36-month period, the closing price of the common stock for any 20 trading days in any 30 consecutive day trading period exceeds $16.00 per share. A third-party valuation expert was engaged to complete a Monte Carlo simulation to account for the market participantscondition. That simulation takes into account the beginning stock price of the Company’s common stock, the expected volatilities for the Company’s stock price and the expected risk-free rate of return. The single grant-date fair value computed by this valuation method is recognized by the Company in accounting for the awards regardless of the actual future outcome of the market condition.measurement date. In connection with measuringend of the performance period.Number of shares Weighted average grant date fair value Aggregate fair value Unvested as of December 31, 2020 — 0 0 Granted 16,435,250 4.43 $ 68,635 Vested — 0 Forfeited/Cancelled — 0 Unvested as of September 30, 2021 16,435,250 4.43 0 Number of shares Weighted average grant date fair value Aggregate fair value Unvested as of December 31, 2020 — 0 0 Granted 2,287,250 7.96 $ 18,210 Vested — 0 Forfeited/Cancelled — 0 Unvested as of September 30, 2021 2,287,250 7.96 0 Research and development expense $ 472 General and administrative expense 4,639 Total $ 5,111 its assets and liabilities,stock options recognized over the Company seeks to maximizerequisite service period of the useindividual grantee, which equals the vesting period.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).grant. Share options granted generally vest over either 42 or 48 months. The following fair value hierarchy is used to classify assets and liabilities basedoptions vest 25% on the observable inputsone-year anniversary of the date of grant with the remaining balance vesting equally on a monthly basis over the remaining vesting term. Upon termination of employment, SERES employees have 90 days to exercise any vested options before the options are forfeited and unobservable inputs used in ordercancelled. SERES’s policy is to valuerecognize forfeitures as they occur.assets and liabilities:Level 1:Quoted prices in active markets for identical assetsperiod from January 1, 2021 through June 25, 2021 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.The Company classifies its U.S. Treasury and equivalent securities as held-to-maturity in accordance with ASC Topic 320 “Investments - Debt and Equity Securities.” Held-to-maturity securities are those securities which the Company has the ability and intent to hold until maturity. Held-to-maturity treasury securities are recorded at amortized cost on the accompanying condensed consolidated balance sheets and adjustednine months ended September 30, 2020. Share based compensation expense for the amortization or accretionPredecessor periods were as follows (in thousands):Predecessor Three Months Ended September 30, 2020 For the
period from
January 1, 2021
through
June 25, 2021Nine Months Ended September 30, 2020 $ 19 $ 25 $ 75 premiums or discounts.At March 31, 2021, assets held in the Trust AccountSERES Asset Purchase, SERES terminated the employment of all participants and none of the awards were comprised of $11 in cash and $250,004,031 in money market funds, which are invested in U.S. Treasury securities. At December 31, 2020, assets held in the Trust Account were comprised of $25 in cash and $250,066,565 in money market funds, which are invested in U.S. Treasury securities. During the three months ended March 31, 2021, the Company withdrew $68,714 of interest income from the Trust Account for its franchise taxes.arewere 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 Assets: Marketable securities held in Trust Account – U.S. Treasury Securities Money Market Fund 1 $ 250,004,031 $ 250,066,565 Liabilities: Warrant Liability – Public Warrants 1 $ 15,833,333 $ 28,999,999 Warrant Liability – Private Placement Warrants 3 $ 491,695 $ 859,849 The Warrants were accounted for as liabilitiesvalue (in thousands):Description Level September 30, 2021 December 31, 2020 Assets: Cash and cash equivalents - Money Market Funds 1 $ 139,014 $ 20,000 Liabilities: Warrant Liabilities - Public Warrants 1 $ 13,938 $ — Warrant Liabilities - Private Placement Warrants 2 $ 305 $ — accordance with ASC 815-40cash equivalents and are presented within warrant liabilities the accompanying condensed consolidated balance sheets. The warrant liabilities are measured atLevel 1 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 consolidated statement of operations.measurements.The Private Placement Warrants were valued using a Monte Carlo simulation, which is considered to be a Level 3 fair value measurement. The Monte Carlo simulation’s primary unobservable input utilized in determining the fair value of the Warrants discount for lack of marketability and the probability of consummation of the Business Combination. The discount for lack of marketability was determined using an average between the Finnerty and Chaffee Models at 4.42% as of March 31, 2021 and 4.99% as of December 31, 2020. The probability assigned to the consummation of the Business Combination was 95% as of March 31, 2021 and 80% as of December 31, 2020 which was determined based on management’s expectations based on the current market conditions and observed historical success rates of business combinations for special purpose acquisition companies. The measurements of the Public Warrants after the detachment of the Public Warrants from the Units is classified as Level 1 due to the use of an observable market quote in an active market under the ticker FIIIW.The key inputs into the Monte Carlo simulation for the Private Placement Warrants were as follows:Input: March 31,
2021 December 31,
2020 Exercise price $ 11.50 $ 11.50 Expected term (years) 5.63 5.13 Probability of business combination closing 95.0 % 80.0 % Risk-free interest rate 1.08 % 0.38 % Expected volatility 27.5 % 21.1 % The following table presents the changes in the fair value of the Level 3 warrant liabilities: Private
Placement Fair value as of January 1, 2021 $ 859,849 Change in fair value (368,154 ) Fair value as of March 31, 2021 $ 491,695 threenine months ended MarchSeptember 30, 2021.
| Description | Level | September 30, 2021 | December 31, 2020 | |||||||||||||||||
| Liabilities: | ||||||||||||||||||||
| SERES Land Contract Obligation and Promissory Note | 3 | $ | 84,086 | $ | — | |||||||||||||||
| ELM Convertible Notes | 3 | $ | — | $ | 25,411 | |||||||||||||||
NOTE 10. SUBSEQUENT EVENTS
| Three Months Ended September 30, 2020 | For the period from January 1, 2021 through June 25, 2021 | Nine Months Ended September 30, 2020 | ||||||||||||||||||
| Corporate allocations | $ | 789 | $ | 143 | $ | 2,039 | ||||||||||||||
| Sokon SAP license allocations | $ | 11 | $ | 21 | $ | 33 | ||||||||||||||
| Defined contribution plan expense | $ | 1 | $ | 24 | $ | 34 | ||||||||||||||
| Defined benefit plan expense | $ | 13 | $ | 17 | $ | 38 | ||||||||||||||
| Share based compensation expense | $ | 78 | $ | 25 | $ | 134 | ||||||||||||||
report. necessary capital expenditures in the Mishawaka manufacturing facility. Due to the travel restrictions the warrants from June 30, 2021 through September 30, 2021. There was no activity for the period from August 20, 2020 through September 30, 2020. warrant liabilities Exchange Commission (the "SEC"). and Estimates financial statements. Referencesquarterly report on Form 10-Q (the “Quarterly Report”) to “we,” “us” or“us,” “our,” and the “Company” refer to the business and operations of Electric Last Mile Solutions, Inc. (f/k/a Forum Merger III Corporation. TheCorporation) and its consolidated subsidiary, Electric Last Mile, Inc. Unless the context otherwise requires, references in this report to “ELM” are intended to refer specifically to Electric Last Mile, Inc., which is a consolidated subsidiary of the Company. All references to “Forum” refer to the Company before the closing of the Business Combination. Capitalized terms used but not otherwise defined herein have the meanings ascribed to such terms in the Notes to the Condensed Consolidated Financial Statements included elsewhere in this report. the Company’s financial condition and results of operations is provided as a supplement to our unaudited condensed consolidated financial statements and accompanying notes to help provide an understanding of our financial condition, the changes in our financial condition and our results of operations.Quarterly Report (the “Financial Statements”). Capitalized terms used but not otherwise defined herein have the meaning set forth in the Financial Statements. 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 StatementsThis Quarterly Report includes “forward-looking statements” within the meaning of the Securities Act 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 Quarterly Report including, without limitation, statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding 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. 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 Annual Report on Form 10-K/A for the period ending December 31, 2020 filed with the SEC and Part II, Item 1A. Risk Factors herein. 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.onin June 25, 2019 under the name Forum Merger III Corporation as a Delaware corporation, and we were formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination. We completed our initial public offering on August 21, 2020. As discussed in more detail below, on June 25, 2021, we completed the previously announced business combination with Electric Last Mile, Inc. (also referred to herein as “ELM”), a private company, and Electric Last Mile, Inc. completed the acquisition of certain assets of EVAP Operations as required by the Merger Agreement and as contemplated by the SERES Asset Purchase Agreement.with one or more businesses. We intend to effectuate our initial Business Combination using cash fromand Asset Purchaseproceedspreviously announced transactions contemplated by that certain Agreement and Plan of our Initial Public Offering and the private placement of the Private Placement Units, the proceeds of the sale of our shares in connection with our initial Business Combination, shares issued to the owners of the target, debt issued to bank or other lenders or the owners of the target, or a combination of the foregoing.We expect to continue to incur significant costs in the pursuit of our initial Business Combination. We cannot assure you that our plans to complete our initial Business Combination will be successful.ELM Business CombinationOnMerger, dated December 10, 2020 we entered intoand amended on May 7, 2021 (as amended, the “Merger Agreement”), by and among Forum, ELMS Merger Agreement with Corp., a Delaware corporation and then a wholly owned subsidiary of Forum (“Merger Sub, ELM,Sub”), Electric Lastthereto, pursuant to which, subjectof ELM. Pursuant to the satisfaction or waiver of certain conditions set forth therein,Merger Agreement, on the Closing Date, Merger Sub will mergemerged with and into ELM , withand the separate corporate existence of Merger Sub ceased and ELM continued as the surviving the merger in accordance with the Delaware General Corporation Law asentity, becoming a wholly owned subsidiary of the Company. TheCompany (this transaction and the other transactions contemplated by the Merger Agreement are collectively referred to herein as the “Business Combination”).is subject toELM closed on the purchase of certain closing conditions,real property located at 12900 McKinley Highway, Mishawaka, Indiana, including the Carveout Transaction (as defined inimprovements thereon and the Merger Agreement)tangible personal property, pursuant to an Agreement of Purchase and Sale (the “SERES Asset Purchase Agreement”), dated April 9, 2021, between ELM and SF Motors, Inc. (d/b/a SERES) (“SERES”). Prior to the Carveout Transaction, ELM will have limited operations.The aggregate cash consideration payable at the Closing to the ELM Stockholders is payable solely in shares of common stock, valued at $10.00 per share, and is calculated as follows: $1,300,000,000, plus the amount of Estimated Closing Date Cash (as defined in the Merger Agreement), plus the Pre-Paid Company Transaction Expense Amount (as defined in the Merger Agreement), minus the Estimated Closing Date Indebtedness (as defined in the Merger Agreement), minus the Convertible Note Adjustment Amount (as defined in the Merger Agreement), minus $292,000,000, the value of the 29,200,000 shares of Class A common stock reserved under the new long-term equity incentive plan ($150,000,000SERES Asset Purchase Agreement was $145 million, plus the assumption of which are restricted share units with vesting terms substantially similar toa pension obligation. The SERES Asset Purchase Agreement also required the 5,000,000 shares of Class A common stock to be placed into escrow at the Closing), minus $2,500,000, the value of the Adjustment Escrow Stock (as defined below) and minus $50,000,000, the value of the Earnout Shares.In addition, an aggregatedelivery of 5,000,000 shares of Class Athe Company’s common stock will be placed into escrow atto SERES, which has been considered part of the Closingasset purchase consideration as the shares are not in settlement of a preexisting relationship.will be payableBasis of PresentationStockholders duringcomprising all of the Earnout Periodsenior management of the Company. Accordingly, for accounting purposes, the financial statements of the Company represent a continuation of the financial statements of ELM, with the acquisition being treated as follows: (i) if the Closing Price equals or exceeds $14.00 on any 20 trading days in any 30-consecutive-day trading period, then 2,500,000 Earnout Shares will be released from escrow toequivalent of ELM issuing stock for the net assets of the Company, accompanied by a recapitalization. As a result of ELM Stockholders, and (ii) ifbeing the Closing Price equals or exceeds $16.00 on any 20 trading days in any 30-consecutive-day trading period, then the remaining 2,500,000 Earnout Shares will be released from escrow to the ELM Stockholders. Subject to the terms and conditions set forthaccounting acquirer, all historical financial information presented in the Merger Agreement, if a qualifying Change in Control (as defined inconsolidated financial statements for the Merger Agreement) occurs duringSuccessor periods represents the Earnout Period, all Earnout Shares not previously released will be released to the ELM Stockholders. Any Earnout Shares not releasedaccounts of ELM. For historical periods prior to the expiration of the Earnout Period will be forfeited and cancelled. We have agreed that, at the Closing, we will place 250,000 shares of Class ABusiness Combination, common stock, into an adjustment escrow accountadditional paid-in capital, shares and net loss per common share have been adjusted to secure any downward post-closing purchase price adjustment. Followingreflect the date on which the Closing Merger Consideration is finally determined, all or a portion of those shares of Class A common stock will either be released to the ELM Stockholders or released to us in accordance with the adjustment mechanisms set forthexchange ratio established in the Merger Agreement.The Merger Agreement contains customary representations, warranties and covenants by the parties thereto and the closing is subject to certain conditions as further described in the Merger Agreement.Results of OperationsWe have neither engaged in any operations (other than searching for a Business Combination after our Initial Public Offering) nor generated any revenues to date. Our only activities through March 31,Combination. were organizational activities, including those necessary to prepare for the initial public offering, identifying a target for our Business Combination and activities in connection with the proposed Business Combination. We do not expect to generate any operating revenues until after the completion of the Business Combination, ELM completed its acquisition of the Mishawaka, Indiana manufacturing facility (the “ELMS Facility”), which comprises the Electric Vehicle Assembly Plant Operations (“EVAP Operations”).EVAP Operations was a wholly owned component of SERES primarily consisting of the ELMS Facility retooled to manufacture electric passenger vehicles. This acquisition is also referred to as the “SERES Asset Purchase” in this report.To support the acquisition of EVAP Operations, ELM also entered into agreements to use certain intellectual property of SERES, procure the supply of inventory from Chongqing Sokon Motor (Group) Imp. & Exp. Co., Ltd. (“Sokon”), an affiliate of SERES, and other arrangements consisting of know-how to manufacture electric commercial vehicles for the North American region and to operate the EVAP Operations on a standalone basis.Business Combination. We generate non-operating incomebalance sheet including cash and cash equivalents, restricted cash, property, plant and equipment, intangible assets, liabilities and equity. The depreciation and amortization of the acquired assets is expected to materially increase our operating expenses in the form of interest income on marketable securities held after the Initial Public Offering.future. We incur expensesbecame a public operating company as a result of beingthe Business Combination and will need to continue to hire personnel and incur costs that are necessary and customary for our operations as a public company, (for legal,which is expected to contribute to higher operating expenses in the near term. In addition, we plan to modify the ELMS Facility for electric commercial vehicle manufacturing and upfitting, which will require additional capital expenditures and resources not included in the Predecessor periods.accountingentities shown are not comparable. The condensed consolidated financial statements of the Company as of and auditing compliance),for the period ended September 30, 2021 reflect the allocation of the purchase consideration to the tangible and intangible assets acquired from SERES, including the primary assets of EVAP Operations . The financial statements of the Predecessor reporting for the period through June 25, 2021 are presented on the basis of SERES historical costs. The Successor reporting period overlaps the Predecessor reporting for the period from August 20, 2020 through June 25, 2021, during which time ELM was formed to raise capital, including through the completion of the Business Combination to facilitate the purchase of the EVAP Operations from SERES. The Predecessor and the Successor are referred to herein as wellthe “Company”.due diligence expenses.Successor Predecessor In thousands Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021 For the
period from
August 20, 2020 through September 30, 2020Three Months Ended September 30, 2020 For the
period from
January 1, 2021
through
June 25, 2021Nine Months Ended September 30, 2020 Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited REVENUE $ 136 $ 136 $ — $ — $ — $ — COST OF REVENUE 134 134 — — — — Gross margin 2 2 — — — — OPERATING EXPENSES: Research and development expense 5,642 8,381 — — — — General and administrative expense 16,699 24,553 — 1,916 1,619 6,040 Total operating expenses 22,341 32,934 — 1,916 1,619 6,040 LOSS FROM OPERATIONS (22,339) (32,932) — (1,916) (1,619) (6,040) Interest expense (656) (3,126) — — — — Gain on change in fair value of warrant liabilities 5,204 6,149 — — — — Other income (expense), net 12 16 — (26) (2) (27) LOSS BEFORE INCOME TAXES (17,779) (29,893) — (1,942) (1,621) (6,067) Income tax benefit — — — — — — NET LOSS AND COMPREHENSIVE LOSS $ (17,779) $ (29,893) $ — $ (1,942) $ (1,621) $ (6,067) Basic and diluted loss per share $ (0.15) $ (0.31) $ — Successor Three Months Ended
September 30, 2021For the
period from
August 20, 2020 through September 30, 2020Increase (Decrease) Unaudited Unaudited $ Change REVENUE $ 136 $ — 136 COST OF REVENUE 134 — 134 Gross margin 2 — 2 OPERATING EXPENSES: Research and development expense 5,642 — 5,642 General and administrative expense 16,699 — 16,699 Total operating expenses 22,341 — 22,341 LOSS FROM OPERATIONS (22,339) — (22,339) Interest expense (656) — (656) Gain on change in fair value of warrant liabilities 5,204 — 5,204 Other income (expense), net 12 — 12 LOSS BEFORE INCOME TAXES (17,779) — (17,779) Income tax benefit — — — NET LOSS AND COMPREHENSIVE LOSS $ (17,779) $ — $ (17,779) Basic and diluted loss per share $ (0.15) $ — $ (0.15) March 31,September 30, 2021, we had a net incomerevenue was $0.1 million. The increase in revenue was due to sale of $12,486,665, which5 units from our production of the Urban Delivery vehicles under an agreement with Randy Marion.$1,054,321, offset by interest incomeattributable to the obligations under the SERES Asset Purchase Agreement. There was no activity for the period from August 20, 2020 through September 30, 2020.marketable securities heldchange in fair value of warrant liabilitiesTrust Accountthree months ended September 30, 2021, the gain in fair value of $6,166 and a gain onthe warrant liabilities was $5.2 million. This represents the change in the fair value of warrant liabilities of $13,534,820.March 31, 2020, we had a net loss of $160, whichSeptember 30, 2021, other income primarily consisted of formationdividend income from money market funds.Successor Nine Months Ended
September 30, 2021For the
period from
August 20, 2020 through September 30, 2020Increase (Decrease) Unaudited Unaudited $ Change REVENUE $ 136 $ — 136 COST OF REVENUE 134 Gross margin 2 OPERATING EXPENSES: Research and development expense 8,381 — 8,381 General and administrative expense 24,553 — 24,553 Total operating expenses 32,934 — 32,934 LOSS FROM OPERATIONS (32,932) — (32,932) Interest expense (3,126) — (3,126) Gain on change in fair value of warrant liabilities 6,149 — 6,149 Other income (expense), net 16 — 16 LOSS BEFORE INCOME TAXES (29,893) — (29,893) Income tax benefit — — — NET LOSS AND COMPREHENSIVE LOSS $ (29,893) $ — $ (29,893) Basic and diluted loss per share $ (0.31) expensesexpense was $24.6 million and primarily consisted of $160.Liquiditypayroll and Capital ResourcesOn August 21, 2020, we consummatedpayroll related expense, legal and consulting fees, as well as marketing expenses.Initial Public Offeringnine months ended September 30, 2021, interest expense was $3.1 million and consisted of 25,000,000 Units at a priceinterest on ELM Convertible Notes of $10.00 per Unit, generating gross proceeds of $250,000,000. Simultaneously$2.4 million, with the closingremaining interest of $0.7 million attributable to the Initial Public Offering, we consummatedobligations from the saleSERES Asset Purchase. The interest on the ELM Convertible Notes was accelerated upon the conversion in conjunction with the Business Combination. There was no activity for the period from August 20, 2020 through September 30, 2020.an aggregate of 741,250 Private Placement Units at a price of $10.00 per Private Placement Unit in a private placement to our stockholders, generating gross proceeds of $7,412,500. Each Private Placement Unit consists of one share of Class A common stock and one-third of one warrant.Following the Initial Public Offering and the sale of the Private Placement Units, a total of $250,000,000 was placed in a trust located in the United States. We incurred $14,185,268 in transaction costs, including $5,000,000 of underwriting fees, $8,750,000 of deferred underwriting fees and $435,268 of other costs.threenine months ended March 31,September 30, 2021, cash used in operating activities was $585,858. Net income of $12,486,665 was affected by interest earned on marketable securities held in the Trust Account of $6,166, a change in the fair value of the warrant liabilities was $6.1 million. This represents the change in the fair value of $13,534,820,the warrants from the initial measurement on June 25, 2021 as part of the Business Combination through September 30, 2021. There was no activity for the period from August 20, 2020 through September 30, 2020.Predecessor Three Months Ended
September 30, 2020Unaudited REVENUE $ — COST OF REVENUE — Gross margin — OPERATING EXPENSES: Research and development expense — General and administrative expense 1,916 Total operating expenses 1,916 LOSS FROM OPERATIONS (1,916) Other income (expense), net (26) LOSS BEFORE INCOME TAXES (1,942) Income tax benefit — NET LOSS AND COMPREHENSIVE LOSS $ (1,942) changes in operating assetsadministrative expenseliabilities, which used $468,463 of cash from operating activities.Foradministrative expense was $1.9 million for the three months ended March 31,September 30, 2020 cash provided by operating activities was $160. Net lossand primarily consisted of $160 was affected by changes in operating assetspayroll and liabilities, which provided $350payroll related expense as well as corporate allocation costs. Upon acquisition of cash from operating activities.As of March 31, 2021, we had cash and marketable securities of $250,004,042 held in the Trust Account. We intend to use substantially all of the funds held in the Trust Account, including any amounts representing interest earned on the Trust Accountassets and liabilities of Predecessor as of June 25, 2021 subsequent to complete our Business Combination. We may withdraw interestthis date Predecessor ceased to pay taxes. Duringexist and as such, there is no financial statement activity for the three months ended March September 30, 2021.Predecessor For the
period from
January 1, 2021
through
June 25, 2021Nine Months Ended
September 30, 2020Increase (Decrease) Unaudited Unaudited $ Change % Change REVENUE $ — $ — $ — — % COST OF REVENUE — — % Gross margin — — — — % OPERATING EXPENSES: General and administrative expense 1,619 6,040 (4,421) (73) % Total operating expenses 1,619 6,040 (4,421) (73) % LOSS FROM OPERATIONS (1,619) (6,040) 4,421 (73) % Other income (expense), net (2) (27) 25 (94) % LOSS BEFORE INCOME TAXES (1,621) (6,067) 4,446 (73) % Income tax benefit — — — — % NET LOSS AND COMPREHENSIVE LOSS $ (1,621) $ (6,067) $ 4,446 (73) % Successor Net cash provided by (used in) Nine Months Ended
September 30, 2021For the
period from
August 20, 2020 through September 30, 2020(Unaudited) (Unaudited) Operating activities $ (37,442) $ — Investing activities (32,175) — Financing activities 215,316 10 Net change in cash $ 145,699 $ 10 Nine Months Ended
September 30, 2021Capital expenditures included in accounts payable $ 377 Noncash investing intangible and other assets included in other long-term liabilities $ 2 Noncash financing conversion of ELM Convertible Notes $ 27,522 Noncash investing SERES Asset Purchase in accounts payable $ 5,012 Noncash investing SERES Asset Purchase assumption of pension obligation $ 113 Noncash financing and investing SERES Asset Purchase issuance of Promissory Note $ 42,824 Noncash financing and investing SERES Asset Purchase issuance of Land Contract obligation $ 69,612 Noncash financing and investing SERES Asset Purchase issuance of common stock $ 49,950 Predecessor Net cash provided by (used in) For the
period from
January 1, 2021
through
June 25, 2021Nine Months Ended
September 30, 2020(Unaudited) (Unaudited) Operating activities $ (1,989) $ (5,759) Investing activities — (23) Financing activities $ 1,989 $ 5,782 Net change in cash $ — $ — Description Land Contract
ObligationPromissory
NoteTotal Payments 19 Consecutive equal monthly installments through April 30, 2023 3,103 1,420 4,523 Total principal payments under Land Contract and Promissory Note $ 58,965 $ 26,987 $ 85,952 Fair value at inception $ 69,612 $ 42,824 $ 112,436 Land Contract
ObligationPromissory
NoteTotal Carrying Value Carrying value as of September 30, 2021 $ 57,658 $ 26,428 $ 84,086 Less current portion due in next 12 months (37,242) (17,044) (54,286) Noncurrent portion due after 1 year $ 20,416 $ 9,384 $ 29,800 Payment Due by Period As of September 30, 2021 Total Less than 1 year 1 - 3 Years 4 - 5 Years More than 5 Years Promissory Note $ 27,028 $ 17,044 $ 9,984 $ — $ — Land Contract obligation 58,966 37,242 21,724 — — Cloud computing service contract 643 206 291 146 — Operating lease - parking lot 2,082 72 144 143 1,723 Operating lease - office building 612 274 338 — — Total $ 89,331 $ 54,838 $ 32,481 $ 289 $ 1,723 withdrew $68,714 of interest income from the Trust Account for its franchise taxes. To the extent that our capital stock 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.As of March 31, 2021, we had cash of $1,038,353 outside of the Trust Account. 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 our initial Business Combination, our Sponsor or an affiliate of our Sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. If we complete our initial Business Combination, we would repay such loaned amounts. In the event that our initial 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 $1,200,000 of such loans may be convertible into units identical to the Private Placement Units, at a price of $10.00 per unit at the option of the lender.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. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our Business Combination. If we are unable to complete our Business Combination because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the Trust Account. In addition, following our Business Combination, if cash on hand is insufficient, we may need to obtain additional financing in order to meet our obligations.Off-Balance Sheet ArrangementsWe have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements, as of March 31, 2021. We do not participatedefined 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 ObligationsWe do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities, other than an agreement to pay an affiliaterules and regulations of the Sponsor a total of $25,000 per month for 24 months for office space, utilitiesSecurities and secretarial and administrative support. Such payments will be accelerated if the Company consummates its initial Business Combination prior to the end of its 24-month term, or $600,000 in the aggregate.In addition, the underwriters are entitled to a deferred fee of $0.35 per Unit, or $8,750,000 in the aggregate. The deferred fee will be forfeited by the underwriters solely in the event that we fail to complete a Business Combination, subject to the terms of the underwriting agreement.condensed consolidated financial statements and related disclosures in conformity with the accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported amounts of assetsthroughout the financial statements and liabilities, disclosure of contingent assetsnotes thereto (including unaudited condensed consolidated financial statements). Those estimates and liabilities atassumptions are based on management's best estimates and judgment and can be subjective and complex. Estimates and assumptions are evaluated on an ongoing basis using historical experience and known facts and circumstances. Estimates and assumptions are adjusted when the datefacts andincomeestimates places a significant demand on subjective judgment. An accounting estimate is critical if: (i) the accounting estimate requires assumptions about matters that were highly uncertain at the time the accounting estimate was made and expenses(ii) changes in the estimate that are reasonably likely to occur from period to period, or use of different estimates that reasonably could have been used in the current period, would have a material impact on the financial condition, results of operations or cash flows. Specific risks for these critical accounting policies are described in the following sections.periods reported. Actual resultsawards, usually the vesting period, which is generally three years for RSUs. Share-based compensation expense is recognized on a straight-line basis, net of actual forfeitures in the period. For performance-based awards with a vesting schedule based entirely on the attainment of performance conditions, share-based compensation expense is recognized for each tranche over the vesting period ascribed to the achievement of the operational milestone for such tranche when the achievement of each individual performance milestone becomes probable. For performance-based awards with a vesting schedule based entirely on the attainment of market conditions, the fair value of such awards is estimated on the grant date using a Monte Carlo simulation; the share-based compensation expense associated with each tranche is recognized over the derived service period determined by the Monte Carlo simulation.differimpact the valuation of our share-based awards and the share-based compensation expense that we will recognize in future periods. Share-based compensation expense is recorded in research and development expense and general and administrative expense in the consolidated statements of operations.estimates. We have identified and recorded in the following critical accounting policies:Warrantspublicly-traded and private placement warrants in accordance with the guidance contained in ASC Topic 815-40 under which the Warrantswarrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, we classify the Warrantswarrants as liabilities at their fair value and adjust the Warrantswarrants 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 statement of operations. The Private Warrants and the Public Warrants for periods where no observable traded price was available are valued using a Monte Carlo simulation. For periods subsequentdetachmentextent we believe that these assets will more likely than not be realized. These deferred tax assets are subject to periodic assessments as to recoverability, and if it is determined that it is more likely than not that the benefits will not be realized, valuation allowances are recorded which would reduce deferred tax assets. In making such determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies and recent financial operations. Due to our history of losses since inception, the net deferred tax assets have been fully offset by a valuation allowance for all years presented.Public WarrantsJOBS Act exempts emerging growth companies from the Units, the Public Warrant quoted market price was used as the fair value as of each relevant date.Class A Common Stock Subjectbeing required to Possible RedemptionWe account for our Class A common stock subjectcomply with new or revised financial accounting standards until private companies are required to possible redemption in accordancecomply with the guidance in ASC Topic 480 “Distinguishing Liabilities from Equity.” Class A common stock subjectnew or revised financial accounting standards. The JOBS Act provides that a company can elect to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that is either within the controlopt out of the holderextended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. We have elected not to opt out of such extended transition period, which means that when a standard is issued or subject to redemption uponrevised and it has different application dates for public or private companies, the occurrence of uncertain events not solely within our control) is classifiedCompany, as temporary equity. At all other times, common stock is classified as stockholders’ equity. Our common stock features certain redemption rights thatan emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard, until such time we are no longer considered to be outsidean emerging growth company. At times, we may elect to early adopt a new or revised standard.control and subject to occurrence of uncertain future events. Accordingly,first fiscal year following the Class A common stock subject to possible redemption is presented as temporary equity, outsidefifth anniversary of the stockholders’ equity sectionclosing of the Company’sinitial public offering, (ii) the last date of our fiscal year in which we have total annual gross revenue of at least $1.07 billion, (iii) the date on which we are deemed to be a “large accelerated filer” under the rules of the SEC with at least $700.0 million of outstanding securities held by non-affiliates as of the prior June 30th, or (iv) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the previous three years.balance sheets.Net Income (Loss) per Common ShareWe apply the two-class method in calculating earnings per share. Net income per common share, basic and diluted for Class A redeemable common stock is calculated by dividing the interest income earned on the Trust Account, net of applicable taxes, by the weighted average number of shares of Class A redeemable common stock outstanding for the periods. Net income (loss) per common share, basic for and Class A and Class B non-redeemable common stock is calculated by dividing net income (loss), less income attributable to Class A redeemable common stock, by the weighted average number of shares of Class A and Class B non-redeemable common stock outstanding for the periods presented. Share settlement of the Company's warrants to purchase an aggregate of 8,580,416 shares of Class A common stock at a price of $11.50 was presumed for the calculation of diluted earnings per share because it is more dilutive than the cash settlement alternative. Under this assumption, the contract is settled in common shares,financial statements and the effectnotes thereto contained elsewhere in this report for more information about recent accounting pronouncements issued and adopted, the timing of the liability classification (change in fair valuetheir adoption and management’s assessment of derivative warrant liability is reversed as a numerator adjustment). Potentially dilutive weighted average shares of 161,066 are included in the denominator. Class A and Class B nonredeemable common stock includes the Founder Shares and Private Placement Shares as these shares do not have any redemption features and do not participate in the income earned on the Trust Account.Recent Accounting StandardsIn August 2020, the FASB issued ASU No. 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): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity” (“ASU 2020-06”), which simplifies accounting for convertible instruments by removing major separation models required under current GAAP. ASU 2020-06 removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception and it also simplifies the diluted earnings per share calculation in certain areas. ASU 2020-06 is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years, with early adoption permitted. We adopted ASU 2020-06 effective as of January 1, 2021. The adoption of ASU 2020-06 did not have antheir potential impact on our financial statements.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 consolidated financial statements.and accounting officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures as of the end of the fiscal quarter ended March 31, 2021, as(as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act.Act) as of the end of the fiscal quarter ended September 30, 2021. Based on this evaluation, our principal executive officer and principal financial and accounting officer have concluded that solely due to the events that led to the Company’s restatement of its financial statements to reclassify the Company’s derivative instruments as liabilities (which are described in the Company’s Amendment No. 1 to its Annual Report on Form 10-K/A filed on May 7, 2021) (the “Restatement”), during the period covered by this report, a material weaknessweaknesses existed and our disclosure controls and procedures were not effective.weaknessweaknesses identified and the resulting Restatement,above, we plancontinue to enhance our processes to identify and appropriately apply applicable accounting requirements, and to better evaluatestandardize change management and understand the nuances of the complexinformation technology access policies. We continue to execute on our plans to hire additional accounting standards that apply to our financial statements. Our plans at this time include providingand information technology professionals, provide enhanced access to accounting literature, research materials and documents and increasedenhance communication among our personnel and third-party professionals with whom we consult regarding complex accounting applications.applications and implementation of internal control (including in the information technology area). The elements of our remediation plan can only be accomplished over time, and we can offer no assurance that these initiatives will ultimately have the intended effects.None.Factors that could causeactual results to differ materially from thosesecurities involves a high degree of risk. You should consider carefully the risks and uncertainties described in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2021 as well as the risks and uncertainties described below, together with all of the other information in this Quarterly Report include the risk factors described in our Annual Report on Form 10-K/A under Forward-Looking Statements10-Q, including our consolidated financial statements and Item 1A - Risk Factors filedrelated notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” before deciding whether to purchase any of our securities. If any of these risks actually occur, it could harm our business, prospects, financial condition, and operating results. In that event, the price of our securities could decline and you could lose part or all of your investment.SECcomponents required to manufacture the ELMS Vehicles. The prices for these components may fluctuate depending on May 7, 2021. Asfactors beyond our control. Furthermore, currency fluctuations, tariffs or shortages in petroleum or other energy sources, and other economic or political conditions have resulted and may continue to result in significant increases in freight charges, logistics costs, and raw material costs. Substantial increases in freight charges, logistics costs, and/or raw materials have and may continue to increase the cost of our components and consequently, our operating costs and the datecosts of this Quarterly Report, there have beenour products. There can be no material changesassurance that we will be able to recoup increasing costs of our components by increasing prices, which could reduce our margins. Further, substantial increases in freight costs and/or logistics costs may increase the risk factors disclosed incosts of our final prospectus filed withproducts and the SECprices paid by our customers, which may decrease demand for our products and would adversely affect our business, prospects, financial condition and results of operations.On June 26, 2019, we issued to our Sponsor an aggregate of 5,750,000 Founder Shares in exchange for a capital contribution of $25,000. On July 1, 2020, the Company effected a stock split of 1:1.25 with respect to the Class B common stock, resulting in the Sponsor holding an aggregate of 7,187,500 Founder Shares. On October 5, 2020, the underwriters’ over-allotment option expired unexercised, and, as a result 937,500 Founder Shares were forfeited resulting in an aggregate of 6,250,000 Founder Shares. The foregoing issuance was made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act.On August 21, 2020, we consummated the Initial Public Offering of 25,000,000 Units. The Units sold in the Initial Public Offering were sold at an offering price of $10.00 per Unit, generating total gross proceeds of $250,000,000. Jefferies LLC acted as sole book-running manager. The securities in the offering were registered under the Securities Act on a registration statement on Form S-1 (No. 333-240171). The Securities and Exchange Commission declared the registration statement effective on August 18, 2020.Simultaneously with the consummation of the Initial Public Offering, we consummated the private placement of an aggregate of 741,250 units at a price of $10.00 per Private Placement Unit, generating total proceeds of $7,412,500. The issuance was made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act.The Private Placement Units are identical to the units sold in the Initial Public Offering, except that the Sponsor and Jefferies LLC have agreed not to transfer, assign or sell any of the Private Placement Units, (except to certain permitted transferees) until 30 days after the completion of the Company’s initial business combination. The warrants underlying the Private Placement Units are also not redeemable by the Company so long as they are held by the Sponsor, Jefferies LLC or their permitted transferees. In addition, for as long as the warrants underlying the Private Placement Units are held by Jefferies LLC or its designees or affiliates, they may not be exercised after five years from the effective date of the registration statement.Of the gross proceeds received from the Initial Public Offering and the Private Placement Units, $250,000,000 was placed in the Trust Account.We paid a total of $5,000,000 in underwriting discounts and commissions and $435,268 for other offering costs and expenses related to the Initial Public Offering. In addition, the underwriters agreed to defer $8,750,000 in underwriting discounts and commissions.For a description of the use of the proceeds generated in our Initial Public Offering, see Part I, Item 2 of this Quarterly Report.
None.Report.Report on Form 10-Q.No.Description of Exhibit2.1Exhibit No.First Amendment to theExhibit Description10.1†† Form of Restricted Stock Unit Award Agreement (Time- and Plan of Merger, dated as of May 7, 2021, by and among Forum Merger III Corporation, ELMS Merger Corp., Electric Last Mile, Inc. and Jason LuoPerformance-Vesting) (incorporated herein by reference to Exhibit 2.110.3 to the Company’s Current Report on Form 8-K (File No. 001-39457), filed with the Securities and Exchange CommissionSEC on May 7,September 3, 2021).10.110.2**31.110.310.4 10.5 Firm Order Agreement, effective as of September 21, 2021, by and between Electric Last Mile, Inc. and Randy Marion Isuzu, LLC dba Randy Marion ELMS (incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K (File No. 001-39457), filed with the SEC on September 27, 2021). 31.1 31.2 32.1 32.2 101.INS Inline XBRL Instance Document - The XBRL Instance Document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL Document 101.CAL101.SCHInline XBRL Taxonomy Extension Schema Document 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.SCH101.DEFXBRL Taxonomy Extension Schema Document101.DEFInline XBRL Taxonomy Extension Definition Linkbase Document 101.LAB Inline XBRL Taxonomy Extension LabelsLabel Linkbase Document101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
____________FORUM MERGER III CORPORATIONElectric Last Mile Solutions, Inc. Date: May 26,November 12, 2021 By: /s/ Marshall KievJames TaylorName:Marshall KievJames Taylor Title:Co-ChiefChief Executive Officer President and Director(Principal Executive Officer)Date: May 26,November 12, 2021 By: /s/ David BorisRobert SongName:David BorisRobert Song Title:Co-Chief Executive Officer,Chief Financial Officer and Director(Principal Financial and Accounting Officer)23