Item 3.01. Notice of Delisting or Failure to Satisfy a Continued Listing Rule or
Standard; Transfer of Listing.
As previously disclosed in the Current Report on Form 8-K filed on May 24, 2021
by Capstar Special Purpose Acquisition Corp. (the "Company"), on April 12, 2021,
the staff of the Securities and Exchange Commission (the "SEC") issued a public
statement entitled "Staff Statement on Accounting and Reporting Considerations
for Warrants issued by Special Purpose Acquisition Companies ("SPACs")" (the
"Staff Statement"). In the Staff Statement, the SEC staff expressed its view
that certain terms and conditions common to SPAC warrants may require the
warrants to be classified as liabilities rather than equity on a SPAC's balance
sheet. Since their issuance on July 7, 2020, the outstanding warrants
("Warrants") to purchase common stock of the Company were accounted for as
equity within the Company's balance sheet. As a result of the Staff Statement,
the Company required additional time to evaluate its financial statements for
the year ended December 31, 2020 and for the quarter ended March 31, 2021, and
did not timely file its Quarterly Report on Form 10-Q for the quarter ended
March 31, 2021 (the "Form 10-Q").
On May 25, 2021, the Company received a notice (the "Notice") from the NYSE
Regulation department at the New York Stock Exchange (the "NYSE") stating that
the Company is not in compliance with Section 802.01E of the NYSE Listed Company
Manual (the "Rule") because it had not timely filed the Form 10-Q with the SEC.
The Rule requires listed companies to timely file all required periodic
financial reports with the SEC. The Notice provides that the Company has six
months from its due date to file the Form 10-Q.
The Notice has no immediate effect on the listing or trading of the Company's
securities. However, if the Company fails to timely regain compliance with the
Rule, the Company's securities will be subject to delisting from the NYSE. The
Company has worked diligently with an independent valuation expert to finalize
the valuation of the Warrants and with its independent registered public
accounting firm to file an amendment to the Annual Report on Form 10-K for the
year ended December 31, 2020 and the Form 10-Q, both of which will reflect the
reclassification of the Warrants as liabilities and which the Company will file
as soon as practicable after the date hereof.
Item 8.01. Other Events.
On June 2, 2021, the Company issued a press release announcing its receipt of
the Notice. A copy of the press release is attached hereto as Exhibit 99.1 and
is incorporated herein by reference
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