(Amendment No. 1)
☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
applicable(1)applicable(1)
(§(§232.405anon-accelerated aLarge accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☒ Smaller reporting company ☒ Emerging growth company ☒
(1) | In September 2021, the registrant became a fully remote company. Accordingly, it does not maintain a principal executive office. |
EXPLANATORY Table of Contents
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Item 1. | Condensed Financial Statements. |
June 30, 2022 | December 31, 2021 | |||||||
(Unaudited) | ||||||||
ASSETS | ||||||||
Current assets : | ||||||||
Cash | $ | 337,908 | $ | 709,182 | ||||
Prepaid expenses | 132,289 | 227,173 | ||||||
Total Current Assets | 470,197 | 936,355 | ||||||
Forward Purchase Agreement derivative asset | 109,000 | 107,000 | ||||||
Cash and Investments held in Trust Account | 600,853,383 | 600,166,685 | ||||||
TOTAL ASSETS | $ | 601,432,580 | $ | 601,210,040 | ||||
LIABILITIES, CLASS A COMMON STOCK SUBJECT TO POSSIBLE REDEMPTION AND STOCKHOLDERS’ DEFICIT | ||||||||
Current liabilities: | ||||||||
Accrued expenses | $ | 395,241 | $ | 427,817 | ||||
Accrued offering costs | 25,000 | 25,000 | ||||||
Income taxes payable | 141,677 | — | ||||||
Due to related party | 31,566 | 1,753 | ||||||
Total Current Liabilities | 593,484 | 454,570 | ||||||
Warrant liabilities | 2,231,467 | 16,853,334 | ||||||
Deferred underwriting fee payable | 21,000,000 | 21,000,000 | ||||||
Total Liabilities | 23,824,951 | 38,307,904 | ||||||
Commitments and Contingencies | 0 | 0 | ||||||
Class A common stock subject to possible redemption 60,000,000 shares at $10.01 and $10.00 per share redemption value as of June 30, 2022 andDecember 31, 2021, respectively | 600,655,094 | 600,000,000 | ||||||
Stockholders’ Deficit | ||||||||
Preferred stock, $0.0001 par value; 1,000,000 shares authorized;0shares issued or outstanding | — | — | ||||||
Class A common stock, $0.0001 par value; 380,000,000 shares authorized;0shares issued or outstanding, exclusive of 60,000,000 shares subject to redemption as of June 30, 2022 and December 31, 2021 | — | — | ||||||
Class B common stock, $0.0001 par value; 20,000,000 shares authorized; 15,000,000 shares issued and outstanding as of June 30, 2022 and December 31, 2021 | 1,500 | 1,500 | ||||||
Additional paid-in capital | — | — | ||||||
Accumulated deficit | (23,048,965 | ) | (37,099,364 | ) | ||||
Total Stockholders’ Deficit | (23,047,465 | ) | (37,097,864 | ) | ||||
TOTAL LIABILITIES, CLASS A COMMON STOCK SUBJECT TO POSSIBLE REDEMPTION AND STOCKHOLDERS’ DEFICIT | $ | 601,432,580 | �� | $ | 601,210,040 | |||
For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||
Formation and operational costs | $ | 308,669 | $ | 276,752 | $ | 707,523 | $ | 1,576,587 | ||||||||
Loss from operations | (308,669 | ) | (276,752 | ) | (707,523 | ) | (1,576,587 | ) | ||||||||
Other income: | ||||||||||||||||
Change in fair value of warrant liabilities and forward purchase agreement derivative asset | 6,201,133 | 3,710,013 | 14,623,867 | 3,906,413 | ||||||||||||
Interest earned on marketable securities held in Trust Account | 832,819 | 45,312 | 968,826 | 60,416 | ||||||||||||
Total other income | 7,033,952 | 3,755,325 | 15,592,693 | 3,966,829 | ||||||||||||
Income before provision for income taxes | 6,725,283 | 3,478,573 | 14,885,170 | 2,390,242 | ||||||||||||
Provision for income taxes | (175,617 | ) | — | (179,677 | ) | — | ||||||||||
Net income | $ | 6,549,666 | $ | 3,478,573 | $ | 14,705,493 | $ | 2,390,242 | ||||||||
Weighted average shares outstanding of Class A common stock | 60,000,000 | 60,000,000 | 60,000,000 | 41,104,972 | ||||||||||||
Basic and diluted net income per share, Class A common stock | $ | 0.09 | $ | 0.05 | $ | 0.20 | $ | 0.04 | ||||||||
Weighted average shares outstanding of Class B common stock | 15,000,000 | 15,000,000 | 15,000,000 | 14,709,945 | ||||||||||||
Basic net income per share, Class B common stock | $ | 0.09 | $ | 0.05 | $ | 0.20 | $ | 0.04 | ||||||||
Weighted average shares outstanding of Class B common stock | 15,000,000 | 15,000,000 | 15,000,000 | 15,000,000 | ||||||||||||
Diluted net income per share, Class B common stock | $ | 0.09 | $ | 0.05 | $ | 0.20 | $ | 0.04 | ||||||||
Class A Common Stock | Class B Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total Stockholders’ Deficit | ||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||
Balance - January 1, 2022 | — | $ | — | 15,000,000 | $ | 1,500 | $ | — | $ | (37,099,364 | ) | $ | (37,097,864 | ) | ||||||||||||||
Net income | — | — | — | — | — | 8,155,827 | 8,155,827 | |||||||||||||||||||||
Balance – March 31, 2022 (unaudited) | — | $ | — | 15,000,000 | $ | 1,500 | $ | — | $ | (28,943,537 | ) | $ | (28,942,037 | ) | ||||||||||||||
Accretion for Class A common stock to redemption amount | — | — | — | — | — | (655,094 | ) | (655,094 | ) | |||||||||||||||||||
Net income | — | — | — | — | — | 6,549,666 | 6,549,666 | |||||||||||||||||||||
Balance – June 30, 2022 (unaudited) | — | $ | — | 15,000,000 | $ | 1,500 | $ | — | $ | (23,048,965 | ) | $ | (23,047,465 | ) | ||||||||||||||
Class A Common Stock | Class B Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total Stockholders’ Equity (Deficit) | ||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||
Balance - January 1, 2021 | — | $ | — | 15,093,750 | $ | 1,509 | $ | 23,491 | $ | (1,268 | ) | $ | 23,732 | |||||||||||||||
Proceeds in excess of fair value Private Placement Warrants | — | — | — | — | 1,663,200 | — | 1,663,200 | |||||||||||||||||||||
Forfeiture of Founder Shares | — | — | (93,750 | ) | (9 | ) | 9 | — | — | |||||||||||||||||||
Accretion for Class A common stock to redemption amount | — | — | — | — | (1,686,700 | ) | (46,493,019 | ) | (48,179,719 | ) | ||||||||||||||||||
Net loss | — | — | — | — | — | (1,088,331 | ) | (1,088,331 | ) | |||||||||||||||||||
Balance – March 31, 2021 (unaudited) | — | $ | — | 15,000,000 | $ | 1,500 | $ | — | $ | (47,582,618 | ) | $ | (47,581,118 | ) | ||||||||||||||
Net income | — | — | — | — | — | 3,478,573 | 3,478,573 | |||||||||||||||||||||
Balance – June 30, 2021 (unaudited) | — | $ | — | 15,000,000 | $ | 1,500 | $ | — | $ | (44,104,045 | ) | $ | (44,102,545 | ) | ||||||||||||||
For the Six months EndedJune 30, | ||||||||
2022 | 2021 | |||||||
Cash Flows from Operating Activities: | ||||||||
Net income | $ | 14,705,493 | $ | 2,390,242 | ||||
Adjustments to reconcile net income to net cash used in operating activities: | ||||||||
Change in fair value of warrant liabilities and forward purchase agreement derivative asset | (14,623,867 | ) | (3,906,413 | ) | ||||
Transaction costs incurred in connection with Initial Public Offering | — | 878,490 | ||||||
Interest earned on marketable securities held in Trust Account | (968,826 | ) | (60,416 | ) | ||||
Changes in operating assets and liabilities: | ||||||||
Prepaid expenses and other current assets | 94,884 | (441,221 | ) | |||||
Due to related party | 29,813 | — | ||||||
Accrued expenses | (32,576 | ) | 411,710 | |||||
Income taxes payable | 141,677 | — | ||||||
Net cash used in operating activities | (653,402 | ) | (727,608 | ) | ||||
Cash Flows from Investing Activities: | ||||||||
Investment of cash into trust Account | — | (600,000,000 | ) | |||||
Cash withdrawn from Trust Account to pay franchise and income taxes | 282,128 | — | ||||||
Net cash provided by (used in) investing activities | 282,128 | (600,000,000 | ) | |||||
Cash Flows from Financing Activities: | ||||||||
Proceeds from sale of Units, net of underwriting discounts paid | — | 588,000,000 | ||||||
Proceeds from sale of Private Placements Warrants | — | 14,000,001 | ||||||
Repayment of promissory note—related party | — | (189,155 | ) | |||||
Payment of offering costs | — | (254,054 | ) | |||||
Net cash provided by Financing Activities | — | 601,556,792 | ||||||
Net Change in Cash | (371,274 | ) | 829,184 | |||||
Cash – Beginning of period | 709,182 | 185 | ||||||
Cash – End of period | $ | 337,908 | $ | 829,369 | ||||
Supplementary cash flow information: | ||||||||
Cash paid for income taxes | $ | 38,000 | ||||||
Non-Cash Investing and Financing Activities: | ||||||||
Offering costs paid by Sponsor in exchange for issuance of founder shares | $ | — | $ | 25,000 | ||||
Offering costs paid through promissory note | $ | — | $ | 163,505 | ||||
Payment of prepaid expenses through promissory note | $ | — | $ | 8,483 | ||||
Deferred underwriting fee payable | $ | — | $ | 21,000,000 | ||||
1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS
Gross proceeds | $ | 600,000,000 | ||
Less: | ||||
Proceeds allocated to Public Warrants | (15,565,200 | ) | ||
Class A common stock issuance costs | (32,614,519 | ) | ||
Plus: | ||||
Accretion of carrying value to redemption value | 48,179,719 | |||
Class A common stock subject to possible redemption, December 31, 2021 | 600,000,000 | |||
Plus: | ||||
Accretion of carrying value to redemption value | 655,094 | |||
Class A common stock subject to possible redemption, June 30, 2022 | $ | 600,655,094 | ||
For the Three Months EndedJune 30, | For the Six Months EndedJune 30, | |||||||||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||||||||
Class A | Class B | Class A | Class B | Class A | Class B | Class A | Class B | |||||||||||||||||||||||||
Basic net income per share of common stock | ||||||||||||||||||||||||||||||||
Numerator: | ||||||||||||||||||||||||||||||||
Allocation of net income, as adjusted | $ | 5,239,733 | $ | 1,309,933 | $ | 2,782,858 | $ | 695,715 | $ | 11,764,394 | $ | 2,941,099 | $ | 1,760,297 | $ | 629,945 | ||||||||||||||||
Denominator: | ||||||||||||||||||||||||||||||||
Basic weighted average stock outstanding | 60,000,000 | 15,000,000 | 60,000,000 | 15,000,000 | 60,000,000 | 15,000,000 | 41,104,972 | 14,709,945 | ||||||||||||||||||||||||
Basic net income per share of common stock | $ | 0.09 | $ | 0.09 | $ | 0.05 | $ | 0.05 | $ | 0.20 | $ | 0.20 | $ | 0.04 | $ | 0.04 | ||||||||||||||||
Diluted net income per share of common stock | ||||||||||||||||||||||||||||||||
Numerator: | ||||||||||||||||||||||||||||||||
Allocation of net income, as adjusted | $ | 5,239,733 | $ | 1,309,933 | $ | 2,782,858 | $ | 695,715 | $ | 11,764,394 | $ | 2,941,099 | $ | 1,751,196 | $ | 639,046 | ||||||||||||||||
Denominator: | ||||||||||||||||||||||||||||||||
Diluted weighted average stock outstanding | 60,000,000 | 15,000,000 | 60,000,000 | 15,000,000 | 60,000,000 | 15,000,000 | 41,104,972 | 15,000,000 | ||||||||||||||||||||||||
Diluted net income per share of common stock | $ | 0.09 | $ | 0.09 | $ | 0.05 | $ | 0.05 | $ | 0.20 | $ | 0.20 | $ | 0.04 | $ | 0.04 |
Level 1: | Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. | |
Level 2: | Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. | |
Level 3: | Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. |
Held-To-Maturity | Level | Amortized Cost | Gross Holding Loss | Fair Value | ||||||||||||||
Assets: | ||||||||||||||||||
June 30, 2022 | U.S. Treasury Securities (Mature on 9/15/2022) | 1 | $ | 600,799,470 | $ | (114,579 | ) | $ | 600,684,891 | |||||||||
June 30, 2022 | FPA Derivative Asset | 3 | $ | 109,000 | ||||||||||||||
December 31, 2021 | Marketable Securities held in Trust Account – Treasury Trust Money Market Fund | 1 | $ | 600,166,685 | ||||||||||||||
December 31, 2021 | FPA Derivative Asset | 3 | $ | 107,000 | ||||||||||||||
Liabilities: | ||||||||||||||||||
June 30, 2022 | Warrant Liability – Public Warrants | 2 | $ | 1,255,200 | ||||||||||||||
June 30, 2022 | Warrant Liability – Private Placement Warrants | 2 | $ | 976,267 | ||||||||||||||
December 31, 2021 | Warrant Liability – Public Warrants | 2 | $ | 9,480,000 | ||||||||||||||
December 31, 2021 | Warrant Liability – Private Placement Warrants | 2 | $ | 7,373,334 |
June 30, 2022 | December 31, 2021 | |||||||
Forward Purchase Price (per unit) | $ | 10.00 | $ | 10.00 | ||||
Implied Stock Price Range (per share) | $ | 9.81 | $ | 9.72 | ||||
Number of Warrants per unit | 0.20 | 0.20 | ||||||
Concluded Unit Value | $ | 9.83 | $ | 9.88 | ||||
Time to Initial Business Combination | 0.33 | 0.58 | ||||||
Risk free rate | 1.97 | % | 0.22 | % |
Private Placement | Public | Warrant Liabilities | ||||||||||
Fair value as of January 1, 2021 | $ | — | $ | — | $ | — | ||||||
Initial measurement on February 26, 2021 | 12,336,801 | 15,565,200 | 27,902,001 | |||||||||
Change in fair value | (4,963,467 | ) | (66,000 | ) | (5,029,467 | ) | ||||||
Transfer to Level 1 | — | (15,499,200 | ) | (15,499,200 | ) | |||||||
Transfer to Level 2 | (7,373,334 | ) | — | (7,373,334 | ) | |||||||
Fair value as of June 30, 2021 | $ | — | $ | — | $ | — | ||||||
Forward Purchase Agreement Derivative | ||||
Initial measurement on February 26, 2021 | $ | 12,900 | ||
Change in fair value | (81,700 | ) | ||
Fair value as of March 31, 2021 | (68,800 | ) | ||
Change in fair value | 55,800 | |||
Fair value as of June 30, 2021 | $ | (13,000 | ) | |
Forward Purchase Agreement Derivative | ||||
Fair value as of December 31, 2021 | $ | (107,000 | ) | |
Change in fair value | 1,800 | |||
Fair value as of March 31, 2022 | (105,200 | ) | ||
Change in fair value | (3,800 | ) | ||
Fair value as of June 30, 2022 | $ | (109,000 | ) | |
This Quarterly Report is being filed to amend Part I, Item 4 “Controls and Procedures”March 31, 2022. The Company’s securities filings can be accessed on the EDGAR section of the Original Quarterly ReportSEC’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.
Except as described above, this Quarterly Report does not amend, update or change any other items or disclosures contained in the Original Quarterly Report. Accordingly, this Quarterly Report does not reflect or purport to reflect any information or events occurring after November 15, 2021 or modify or update those disclosures affected by subsequent events. Accordingly, this Quarterly Report should be read in conjunction with the Original Quarterly Report and the Company’s other filings with the SEC.
HUDSON EXECUTIVE INVESTMENT CORP. III
FORM 10-Q/A FOR THE QUARTER ENDED SEPTEMBER 30, 2021
| ||
i
Under
During the fiscal quarter ended September 30, 2021, there has been
We As of the date of this Quarterly Report, there have identified abeen no material weaknesschanges to the risk factors disclosed in our internal control over financial reporting as of June 30, 2021. If we are unable to develop and maintain an effective system of internal control over financial reporting,Formnot be abledisclose changes to accurately reportsuch factors or disclose additional factors from time to time in our financial resultsfuture filings with the SEC.
We have identified a material weakness in our internal control over financial reporting$493,009 for other costs and expenses related to the Company’s accountingInitial Public Offering. In addition, the underwriters agreed to defer $21,000,000 in underwriting discounts and reportingcommissions.
No. | Description of Exhibit | |
31.1* | Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
31.2* | Certification of Principal Financial Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
32.1** | Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
32.2** | Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
101.INS* | Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | |
101.SCH* | Inline XBRL Taxonomy Extension Schema Document | |
101.CAL* | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
101.DEF* | Inline XBRL Taxonomy Extension Definition Linkbase Document | |
101.LAB* | Inline XBRL Taxonomy Extension Labels Linkbase Document | |
101.PRE* | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
104* | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101.INS) |
* | Filed herewith. |
** | Furnished. |
|
3
HUDSON EXECUTIVE INVESTMENT CORP. III | ||||||
Date: | By: | /s/ Douglas G. Bergeron | ||||
Name: | Douglas G. Bergeron | |||||
Title: | Chief Executive Officer (Principal Executive Officer) | |||||
Date: | By: | /s/ Ira Mosberg | ||||
Name: | Ira Mosberg | |||||
Title: | Chief Financial Officer (Principal Financial and Accounting Officer) |
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