Annual report pursuant to Section 13 and 15(d)

Restatement of Previously Issued Financial Statements

v3.21.2
Restatement of Previously Issued Financial Statements
5 Months Ended
Dec. 31, 2020
Accounting Changes and Error Corrections [Abstract]  
Restatement of Previously Issued Financial Statements
NOTE 2 — RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS
The Company previously accounted for its outstanding Public Warrants (as defined in Note 4) and Private Placement Warrants (collectively, with the Public Warrants, the “Warrants”) issued in connection with its Initial Public Offering as components of equity instead of as derivative liabilities. The warrant agreement governing the Warrants includes a provision that provides for potential changes to the settlement amounts dependent upon the characteristics of the holder of the warrant. In addition, the warrant agreement includes a provision that in the event of a tender offer or exchange offer made to and accepted by holders of more than 50% of the outstanding shares of a single class of stock, all holders of the Warrants would be entitled to receive cash for their Warrants (the “tender offer provision”).
On April 12, 2021, the Acting Director of the Division of Corporation Finance and Acting Chief Accountant of the Securities and Exchange Commission together issued a statement regarding the accounting and reporting considerations for warrants issued by special purpose acquisition companies entitled “Staff Statement on Accounting and Reporting Considerations for Warrants Issued by Special Purpose Acquisition Companies (“SPACs”)” (the “SEC Statement”). Specifically, the SEC Statement focused on certain settlement terms and provisions related to certain tender offers following a business combination, which terms are similar to those contained in the warrant agreement.
In further consideration of the SEC Statement, the Company’s management further evaluated the Warrants under Accounting Standards Codification (“ASC”) Subtopic
815-40,
Contracts in Entity’s Own Equity. ASC Section
815-40-15
addresses equity versus liability treatment and classification of equity-linked financial instruments, including warrants, and states that a warrant may be classified as a component of equity only if, among other things, the warrant is indexed to the issuer’s common stock. Under ASC
Section 815-40-15,
a warrant is not indexed to the issuer’s common stock if the terms of the warrant require an adjustment to the exercise price upon a specified event and that event is not an input to the fair value of the warrant. Based on management’s evaluation, the Company’s audit committee, in consultation with management, concluded that the Company’s Private Placement Warrants are not indexed to the Company’s common stock in the manner contemplated by ASC
Section 815-40-15
because the holder of the instrument is not an input into the pricing of a
fixed-for-fixed
option on equity shares. In addition, based on management’s evaluation, the Company’s audit committee, in consultation with management, concluded that the tender offer provision fails the “classified in stockholders’ equity” criteria as contemplated by ASC
Section 815-40-25.
 
As a result of the above, the Company should have classified the Warrants as derivative liabilities in its previously issued financial statements. Under this accounting treatment, the Company is required to measure the fair value of the Warrants at the end of each reporting period as well as
re-evaluate
the treatment of the warrants (including on October 5, 2020 and December 31, 2020) and recognize changes in the fair value from the prior period in the Company’s operating results for the current period.
The Company’s accounting for the Warrants as components of equity instead of as derivative liabilities did not have any effect on the Company’s previously reported marketable securities held in trust, operating expenses, cash flows or cash.
 
 
  
As
Previously
Reported
 
  
Adjustments
 
  
As Restated
 
Balance sheet as of October 5, 2020
  
     
  
     
  
     
Warrant Liability
  
$
—  
 
  
$
28,060,000
 
  
$
28,060,000
 
Total Liabilities
  
 
13,125,000
 
  
 
28,060,000
 
  
 
41,185,000
 
Class A Ordinary Shares Subject to Possible Redemption
  
 
384,227,970
 
  
 
(28,060,000
  
 
356,167,970
 
Class A Ordinary Shares
  
 
158
 
  
 
280
 
  
 
438
 
Additional
Paid-in
Capital
  
 
5,003,706
 
  
 
999,094
 
  
 
6,002,800
 
Accumulated Deficit
  
 
(5,005
  
 
(999,374
  
 
(1,004,379
Balance sheet as of December 31, 2020
  
     
  
     
  
     
Warrant Liability
  
$
—  
 
  
$
46,970,000
 
  
$
46,970,000
 
Total Liabilities
  
 
13,243,353
 
  
 
46,970,000
 
  
 
60,213,353
 
Ordinary Shares Subject to Possible Redemption
  
 
384,081,240
 
  
 
(46,970,000
  
 
337,111,240
 
Class A Ordinary Shares
  
 
159
 
  
 
470
 
  
 
629
 
Additional
Paid-in
Capital
  
 
5,150,585
 
  
 
19,908,904
 
  
 
25,059,489
 
Accumulated Deficit
  
 
(151,735
  
 
(19,909,374
  
 
(20,061,109
Statement of Operations for the Period from July 29, 2020 (inception) to December 31, 2020
  
     
  
     
  
     
Change in fair value of warrant liabilities
  
$
—  
 
  
$
(18,910,000
  
$
(18,910,000
Transaction costs allocable to warrants
  
 
—  
 
  
 
(999,374
  
 
(999,374
Net loss
  
 
(151,735
  
 
(19,909,374
  
 
(20,061,109
Statement of Cash Flows for the Period from July 29, 2020 (inception) to December 31, 2020
  
     
  
     
  
     
Net loss
  
$
(151,735
  
$
(19,909,374
  
$
(20,061,109
Change in fair value of warrant liabilities
  
 
—  
 
  
 
18,910,000
 
  
 
18,910,000
 
Transaction costs allocable to warrants
  
 
—  
 
  
 
999,374
 
  
 
999,374
 
Initial classification of Class A ordinary shares subject to redemption
  
 
384,227,970
 
  
 
(28,060,000
  
 
356,167,970
 
Change in value of Class A ordinary shares subject to redemption
  
 
(146,730
  
 
(18,910,000
  
 
(19,056,730