Restatement of Previously Issued Financial Statements | Note 2 — Restatement of Previously Issued Financial Statements In connection with the change in presentation of Class A common stock subject to possible redemption, the Company concluded it should restate its previously filed financial statements to classify all Class A common stock subject to possible redemption in temporary equity. In accordance with the SEC and its staff’s guidance on redeemable equity instruments in ASC 480-10-S99, redemption provisions not solely within the control of the Company require common stock subject to redemption to be classified outside of permanent equity. The Company had previously classified a portion of its Class A common stock in permanent equity, or total stockholders’ equity. Although the Company did not specify a maximum redemption threshold, its charter currently provides that, the Company will not redeem its public shares in an amount that would cause its net tangible assets to be less than $5,000,001. Previously, the Company did not consider redeemable shares classified as temporary equity as part of net tangible assets. Effective with its financial statements for quarterly period ended September 30, 2021, the Company revised this interpretation to include temporary equity in net tangible assets. In addition, in connection with the change in presentation for the Class A common stock subject to possible redemption, the Company determined it should restate its earnings per share calculation to allocate income and losses shared pro rata between the two classes of shares. This presentation contemplates a Business Combination as the most likely outcome, in which case, both classes of shares share pro rata in the income and losses of the Company. In accordance with SEC Staff Accounting Bulletin No. 99, “Materiality,” and SEC Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements,” the Company evaluated the corrections and has determined that the related impact was material to the previously filed financial statements that contained the error. Therefore, the Company, in consultation with its Audit Committee, concluded that the following financial statements should be restated: (i) audited balance sheet as of August 7, 2020 (the “Post IPO Balance Sheet”), as previously revised in the Company’s Annual Report on Form 10-K, as amended, for the fiscal year ended December 31, 2020, filed with the SEC on May 25, 2021 (“2020 Form 10-K/A No. 1”); (ii) audited financial statements included in the 2020 Form 10-K/A No. 1; (iii) unaudited interim financial statements included in the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2020, filed with the SEC on November 16, 2020; (iv) unaudited interim financial statements included in the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2021, filed with the SEC on May 18, 2021; and (v) unaudited interim financial statements included in the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2021, filed with the SEC on August 17, 2021 (collectively, the “Affected Periods”), should be restated to report all Public Shares as temporary equity and should no longer be relied upon. As such, the Company will restate its financial statements for the Affected Periods in this Form 10-K/A for the Post IPO Balance Sheet and the Company’s audited financial statements included in the 2020 Form 10-K/A No. 1. The unaudited condensed financial statements for the periods ended March 31, 2021 and June 30, 2021 will be amended in the Company’s Quarterly Report on Form 10-Q/A for the quarterly period ended September 30, 2021, to be filed with the SEC (the “Q3 Form 10-Q”). The restatement does not have an impact on the Company’s cash position and cash held in the trust account established in connection with the IPO (the “Trust Account”). The table below presents the effect of the financial statement adjustments related to the restatement discussed above of the Company’s previously reported balance sheet as of September 30, 2020: As of September 30, 2020 As Reported, As Previously Restated in 10-K/A Amendment No. 1 Adjustment As Restated Class A common stock subject to redemption 551,183,500 23,816,500 575,000,000 Class A common stock 238 (238 ) - Additional paid-in capital 5,091,738 (5,091,738 ) - Accumulated deficit (93,409 ) (49,712,074 ) (49,805,483 ) Total Stockholders' equity (deficit) $ 5,000,005 $ (54,804,050 ) $ (49,804,045 ) The Company’s statement of stockholders’ equity (deficit) has been restated to reflect the changes to the impacted shareholders’ equity accounts described above. The table below presents the effect of the financial statement adjustments related to the restatement discussed above of the Company’s previously reported statement of cash flows for the period from June 12, 2020 (inception) through September 30, 2020: For the period from June 12, 2020 (inception) through September 30, 2020 As Reported, Adjustment As Restated Initial value of Class A common stock subject to possible redemption $ 478,891,280 $ (478,891,280 ) $ - Change in value of Class A common stock subject to possible redemption $ 72,292,220 $ (72,292,220 ) $ - The impact to the reported amounts of weighted average shares outstanding and basic and diluted earnings per share is presented below for the period from June 12, 2020 (inception) through September 30, 2020: Earnings (Loss) Per Share As Reported, Adjustment As Restated For the Period from June 12, 2020 (Inception) through September 30, 2020 Net loss $ (93,409 ) $ - $ (93,409 ) Weighted average shares outstanding - Class A common stock 51,363,636 (23,393,339 ) 27,970,297 Basic and diluted earnings per share - Class A common stock $ - $ (0.00 ) $ (0.00 ) Weighted average shares outstanding - Class B common stock 14,375,000 (1,689,356 ) 12,685,644 Basic and diluted earnings per share - Class B common stock $ (0.01 ) $ 0.01 $ (0.00 ) The table below presents the effect of the financial statement adjustments related to the restatement discussed above of the Company’s previously reported balance sheet as of December 31, 2020: As Reported, As Previously Restated in 10-K/A Amendment No. 1 Adjustment As Restated As of December 31, 2020 Class A common stock subject to redemption 551,182,390 23,817,610 575,000,000 Class A common stock 238 (238 ) - Additional paid-in capital 5,092,848 (5,092,848 ) - Accumulated deficit (94,519 ) (61,280,994 ) (61,375,513 ) Total Stockholders' equity (deficit) $ 5,000,005 $ (66,374,080 ) $ (61,374,075 ) The Company’s statement of stockholders’ equity (deficit) has been restated to reflect the changes to the impacted shareholders’ equity accounts described above. The table below presents the effect of the financial statement adjustments related to the restatement discussed above of the Company’s previously reported statement of cash flows for the period from June 12, 2020 (inception) through December 31, 2020: For the period from June 12, 2020 As Reported, Adjustment As Restated Initial value of Class A common stock subject to possible redemption $ 517,427,120 $ (517,427,120 ) $ - Change in value of Class A common stock subject to possible redemption $ (8,801,200 ) $ 8,801,200 $ - The impact to the reported amounts of weighted average shares outstanding and basic and diluted earnings per share is presented below for the period from June 12, 2020 (inception) through December 31, 2020: Earnings (Loss) Per Share As Reported, Adjustment As Restated For the Period from June 12, 2020 (Inception) through December 31, 2020 Net loss $ (10,092,969 ) $ - $ (10,092,969 ) Weighted average shares outstanding - Class A common stock 55,204,082 (13,157,450 ) 42,046,632 Basic and diluted loss per share - Class A common stock $ - $ (0.18 ) $ (0.18 ) Weighted average shares outstanding - Class B common stock 13,490,933 - 13,490,933 Basic and diluted loss per share - Class B common stock $ (0.76 ) $ 0.58 $ (0.18 ) The table below presents the effect of the financial statement adjustments related to the restatement discussed above of the Company’s previously reported balance sheet as of August 7, 2020: As of August 7, 2020 As Reported, Adjustment As Restated Class A common stock subject to redemption at $10.00 per share 478,891,280 21,108,720 500,000,000 Class A common stock 211 (211 ) - Additional paid-in capital 5,029,435 (5,029,435 ) - Accumulated deficit (31,076 ) (45,716,594 ) (45,747,670 ) Total Stockholders' equity (deficit) $ 5,000,008 $ (50,746,240 ) $ (45,746,232 ) Class A Common Stock Subject to Possible Redemption The Company’s Class A common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to the occurrence of future events. As of December 31, 2020, there were 57,500,000 shares of Class A common stock outstanding, which were all subject to possible redemption. The Class A common stock issued in the Initial Public Offering and issued as part of the Over-Allotment Units were recognized in Class A common stock subject to possible redemption as follows: Gross proceeds from Initial Public Offering $ 575,000,000 Less: Fair value of Public Warrants at issuance (22,859,790 ) Offering costs allocated to Class A common stock subject to possible redemption (30,966,946 ) Plus: Accretion on Class A common stock subject to possible redemption amount 53,826,736 Class A common stock subject to possible redemption $ 575,000,000 Going Concern At December 31, 2020, the Company had cash of approximately $1.3 million and working capital of approximately $1.1 million. The Company’s liquidity needs since inception had been satisfied through the cash receipt of $25,000 from the Sponsor to purchase the Founder Shares and a loan of $200,000 pursuant to the Note issued to the Sponsor (Note 5). Subsequent to August 7, 2020, the Company’s liquidity needs had been satisfied with the net proceeds from the consummation of the Private Placement not held in the Trust Account. The Note remains unpaid as of December 31, 2020 and is due on demand. In addition, in order to finance transaction costs in connection with a Business Combination, the Sponsor may, but is not obligated to, provide the Company Working Capital Loans (see Note 5). As of December 31, 2020, there were no Working Capital Loans outstanding. 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 until August 7, 2022 to consummate the proposed Business Combination. If a business combination is not consummated by this date, there will be a mandatory liquidation and subsequent dissolution of the Company. Management has determined that the mandatory liquidation, should a business combination not occur, and potential subsequent dissolution, raises substantial doubt about the Company’s ability to continue as a going concern. No adjustments have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate after August 7, 2022. The Company intends to complete the proposed Business Combination before the mandatory liquidation date. However, there can be no assurance that the Company will be able to consummate any business combination by August 7, 2022. |