For the nine months ended September 30, 2021 and 2020, we had a net income of $12,043,581 and net loss of $6,108, respectively. Net loss for the nine months ended September 30, 2021 consisted primarily $17,773,513 of change in fair value of warrant liability and $19,262 of earned interest income, offset by $5,749,195 of professional fees and other expenses.
Liquidity and Capital Resources
As of September 30, 2021, we had cash outside our trust account of $134,055, available for working capital needs. All remaining cash was held in the trust account and is generally unavailable for our use, prior to an initial business combination.
On December 11, 2020, we consummated the IPO of 30,000,000 Units (and, with respect to the common stock included in the Units being offered, the “public share”, the warrants included in the Units, the “public warrants” and the rights included in the Units, the “rights”), at $10.00 per Unit, generating gross proceeds of $300,000,000.
Simultaneously with the closing of the IPO, we consummated the sale of 8,000,000 warrants (the “Private Warrants”), at a price of $1.00 per Private Warrant, generating gross proceeds of $8,000,000.
In connection with the IPO, the underwriters were granted a
45-day
option from the date of the prospectus (the “Over-Allotment Option”) to purchase up to 3,915,000 additional Units to cover over-allotments (the “Over-Allotment Units”), if any. On December 11, 2020, the underwriters partially exercised their Over-Allotment Option and purchased an additional 3,900,000 Units. The unexercised portion of the over-allotment option was forfeited.
Following our IPO and the sale of the Private Warrants, a total of $300,000,000 ($10.00 per Unit) was placed in the Trust Account. We incurred $17,107,057 in IPO related costs, including $6,000,000 of underwriting fees, $10,500,000 of deferred underwriting discount and $607,057 of other costs.
As of September 30, 2021, we had investments held in the Trust Account of $300,019,322 (including approximately $19,000 of interest income) consisting of mutual funds. Interest income on the balance in the Trust Account may be used by us to pay taxes.
For the nine months ended September 30, 2021, cash used in operating activities was $630,274. Net income of $12,043,581 was impacted by interest earned on investments held in the Trust Account of $19,240, change in fair value of warrant liability of $17,773,513, and changes in operating assets and liabilities, which provided $5,118,898 of cash for operating activities.
We intend to use substantially all of the funds held in the trust account, including any amounts representing interest earned on the trust account (excluding the deferred underwriters’ discount) to complete our initial Business Combination. We may withdraw interest to pay our taxes and liquidation expenses if we are unsuccessful in completing a Business Combination. We estimate our annual franchise tax obligations to be $200,000, which is the maximum amount of annual franchise taxes payable by us as a Delaware corporation per annum, which we may pay from funds from the Public Offering held outside of the trust account or from interest earned on the funds held in the trust account and released to us for this purpose. Our annual income tax obligations will depend on the amount of interest and other income earned on the amounts held in the trust account reduced by our operating expense and franchise taxes. We expect the interest earned on the amount in the trust account will be sufficient to pay our income taxes. To the extent that our equity or debt is used, in whole or in part, as consideration to complete our initial 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.
On June 2, 2021, we issued an unsecured promissory note to the Sponsor for an aggregate available principal amount of $300,000 to be used for a portion of the expenses of the Business Combination. This loan
is non-interest
bearing, unsecured and due at the earlier of December 31, 2021 or the closing of the Business Combination. As of September 30, 2021, there were no borrowings under the promissory note.
Further, our Sponsor, officers and directors or their respective affiliates may, but are not obligated to, loan us funds as may be required (the “Working Capital Loans”). If we complete a Business Combination, we would repay the Working Capital Loans. In the event that a Business Combination does not close, we 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. Such Working Capital Loans would be evidenced by promissory notes. The notes would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion. As of September 30, 2021, no Working Capital Loans have been issued.