The following discussion and analysis of our financial condition and results of
operations should be read in conjunction with our audited financial statements
and the notes related thereto which are included in "Item 8. Financial
Statements and Supplementary Data" of this Annual Report on Form
10-K.
Certain information contained in the discussion and analysis set forth below
includes forward-looking statements. Our actual results may differ materially
from those anticipated in these forward-looking statements as a result of many
factors, including those set forth under "Cautionary Note Regarding
Forward-Looking Statements," "Item 1A. Risk Factors" and elsewhere in this
Annual Report on Form
10-K.

Overview

We are a blank check company formed under the laws of the State of Delaware on July 7, 2020, for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or other similar Business Combination with one or more businesses. We intend to effectuate our Business Combination using cash from the proceeds of the initial public offering and the sale of the private placement warrants, our capital stock, debt or a combination of cash, stock and debt.

We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete a Business Combination will be successful.

Results of Operations

We have neither engaged in any operations nor generated any revenues to date. Our only activities from July 7, 2020 (inception) through December 31, 2021, were organizational activities, those necessary to prepare for the initial public offering, described below, and the search for a target company for a Business Combination. We do not expect to generate any operating revenues until after the completion of our Business Combination. We generate non-operating income in the form of interest income on marketable securities held after the initial public offering. We incur expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses.


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For the year ended December 31, 2021, we had net income of $19,597,699, which consists of the change in fair value of warrant liability of $21,686,000, interest earned on marketable securities held in our trust account of $141,952 and an unrealized gain on marketable securities held in our trust account of $4,753 offset by operating and formation costs of $2,235,006, which are comprised primarily of fees for legal, financial reporting, accounting and auditing compliance, due diligence, consulting and franchise taxes.

For the period from July 7, 2020 (inception) through December 31, 2020, we had a net loss of $2,700,955, which consists of formation and operating costs of $2,993,724, change in fair value of warrant liability of $1,652,267 and transaction costs associated with initial public offering of $1,477,685 offset by interest income on marketable securities held in our trust account of $103,994 and an unrealized gain on marketable securities held in our trust account of $14,193.

Liquidity and Capital Resources

Until the consummation of our initial public offering, our only source of liquidity was an initial purchase of Class B common stock by our sponsor and loans from our sponsor, as described in Note 5. Related Party Transactions to our financial statements.

On September 18, 2020, we consummated the initial public offering of 41,400,000 units at a price of $10.00 per units, which includes the full exercise by the underwriters of the over-allotment option to purchase an additional 5,400,000 units , generating gross proceeds of $414,000,000. Simultaneously with the closing of our initial public offering, we consummated the sale of 6,853,333 private placement warrants at a price of $1.50 per private placement warrant in a private placement to our sponsor, generating gross proceeds of $10,280,000.

For the year ended December 31, 2021, cash used in operating activities was $1,186,212. Net income of $19,597,699 was attributable to the change in fair value of warrant liability of $21,686,000 and interest earned on marketable securities held in our trust account of $141,952 and an unrealized gain on marketable securities held in our trust account of $4,753 offset by changes in operating assets and liabilities, which provided $1,048,794 in cash from operating activities.

For the period from July 7, 2020 (inception) through December 31, 2020, cash used in operating activities was $501,235. Net loss of $2,700,955 was affected by interest earned on marketable securities held in our trust account of $103,994, an unrealized gain on marketable securities held in our trust account $14,193, change in fair value of warrant liability of $1,652,267, transaction costs associated with initial public offering of $1,477,685, warrant liability in excess of purchase price of private warrants of $2,535,733, and changes in operating assets and liabilities, which used $43,244 of cash from operating activities.

As of December 31, 2021, we had cash and marketable securities held in our trust account of $414,127,265. We intend to use substantially all of the funds held in our trust account, including any amounts representing interest earned on our trust account to complete our Business Combination. We may withdraw interest to pay franchise and income taxes. During the year ended December 31, 2021, cash withdrawn from our trust account to pay franchise and income taxes totaled $137,627. To the extent that our capital stock or debt is used, in whole or in part, as consideration to complete our 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.

As of December 31, 2021, we had cash of $584,117 outside of our trust account. We intend to use the funds held outside our trust account primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, and structure, negotiate and complete a Business Combination.

In order to fund working capital deficiencies or finance transaction costs in connection with a Business Combination, we intend to borrow additional amounts under the Second Promissory Note, under which $1,750,000 remained available to be drawn as of December 31, 2021. The Second Promissory Note is non-interest bearing and payable on the earlier of (i) September 18, 2022 or (ii) the consummation of our initial Business Combination.

If we fully draw down on the Second Promissory Note and require additional funds for working capital purposes, the sponsor, an affiliate of the sponsor, or our officers and directors may, but are not obligated to, loan us such additional funds as may be required. If we complete a Business Combination, we would repay such additional loaned amounts, without interest, upon consummation of the Business Combination. In the event that a Business Combination does not close, we may use a portion of the working capital held outside the trust account to repay such additional loaned amounts but no proceeds from our trust account would be used for such repayment. Up to $1,500,000 of such additional loans (if any) may be convertible into warrants, at a price of $1.50 per warrant at the option of the lender. The warrants would be identical to the private placement warrants, including as to exercise price, exercisability and exercise period. Except for the foregoing, the terms of such additional loans (if any) have not been determined and no written agreements exist with respect to such loans.

We do not believe we will need to raise additional funds in order to meet the expenditures required for operating our business. However, if we do need to raise additional capital and are unable to, then we may be required to take additional measures to conserve liquidity, which could include, but not necessarily include or be limited to, curtailing operations, suspending the pursuit of a potential transaction, and reducing overhead expenses. We cannot provide any assurance that new financing will be available to us on commercially acceptable terms, if at all.


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Going Concern

In connection with our assessment of going concern considerations in accordance with the authoritative guidance in Financial Accounting Standard Board ("FASB") Accounting Standards Update ("ASU") 2014-15, "Disclosures of Uncertainties about an Entity's Ability to Continue as a Going Concern," management has determined that the mandatory liquidation and subsequent dissolution, should the we be unable to complete a business combination, raises substantial doubt about the our ability to continue as a going concern. We have until September 18, 2022 to consummate a Business Combination. It is uncertain that we will be able to consummate a Business Combination by this time. If a Business Combination is not consummated by this date, there will be a mandatory liquidation and subsequent dissolution. No adjustments have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate after September 18, 2022.



Off-Balance
Sheet Financing Arrangements

We have no obligations, assets or liabilities, which would be considered
off-balance
sheet arrangements as of December 31, 2021. We do not participate in
transactions that create relationships with unconsolidated entities or financial
partnerships, often referred to as variable interest entities, which would have
been established for the purpose of facilitating
off-balance
sheet arrangements. We have not entered into any
off-balance
sheet financing arrangements, established any special purpose entities,
guaranteed any debt or commitments of other entities, or purchased any
non-financial
assets.

Contractual Obligations

On June 29, 2021, we issued an unsecured promissory note to our sponsor (the "Second Promissory Note"), pursuant to which we may borrow up to an aggregate principal amount of $2,500,000. The Second Promissory Note is non-interest bearing and payable on the earlier of (i) September 18, 2022, or (ii) the consummation of the Initial Business Combination. As of December 31, 2021, the outstanding balance under the Second Promissory Note was $750,000 and the remaining amount available to be drawn was $1,750,000.

We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities, other than the Second Promissory Note and an agreement to pay an affiliate of the sponsor a monthly fee of $10,000 for office space and administrative support to the Company. We began incurring these fees on September 15, 2020, and will continue to incur these fees monthly until the earlier of the completion of the Business Combination and the Company's liquidation.

The underwriters are entitled to a deferred fee of $0.35 per units, or $14,490,000 in the aggregate. Subject to the terms of the underwriting agreement, (i) the deferred fee will be placed in the trust account and released to the underwriters only upon the completion of a Business Combination and (ii) the deferred fee will be waived by the underwriters in the event that we do not complete a Business Combination. Up to 50% of the deferred underwriting commissions may be paid at the sole discretion of our management team to the underwriters in the allocations determined by our management team and/or to third parties not participating in the initial public offering (but who are members of the Financial Industry Regulatory Authority) that assist us in consummating its initial Business Combination.

Critical Accounting Policies

The preparation of our financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates. We have identified the following critical accounting policies:

Class A Common Stock Subject to Possible Redemption

We account for our Class A common stock subject to possible conversion in accordance with the authoritative guidance in FASB Accounting Standards Codification ("ASC") Topic 480 "Distinguishing Liabilities from Equity" ("ASC Topic 480"). Shares of Class A common stock subject to mandatory redemption is classified as a liability instrument and measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control) is classified as temporary equity. At all other times, common stock is classified as stockholders' equity. Our common stock features certain redemption rights that are considered to be outside of our control and subject to occurrence of uncertain future events. Accordingly, common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders' equity section of our balance sheets.

Warrant Liabilities

We account for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant's specific terms and applicable authoritative guidance in FASB ASC Topic 480, and ASC Topic 815, "Derivatives and Hedging" ("ASC Topic 815"). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC Topic 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC Topic 815, including whether the warrants are indexed to our own common shares and whether the warrant holders could potentially require "net cash settlement" in a circumstance outside of our control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent balance sheet date thereafter while the warrants are outstanding.


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For issued or modified warrants that meet all of the criteria for equity
classification, the warrants are required to be recorded as a component of
additional
paid-in
capital at the time of issuance. For issued or modified warrants that do not
meet all the criteria for equity classification, the warrants are required to be
recorded at their initial fair value on the date of issuance, and each balance
sheet date thereafter. Changes in the estimated fair value of the warrants are
recognized as a
non-cash
gain or loss within change in fair value of warrant liability on the statements
of operations. The fair value of the warrants was initially estimated using a
Monte Carlo Simulation approach. Subsequent measurement of the fair value of the
warrants was estimated using the publicly traded price of our warrants.

Net Income (Loss) Per Common Share


Net income (loss) per common share is computed by dividing net income (loss) by
the weighted average number of shares of common stock outstanding during the
period. We apply the
two-class
method in calculating earnings per share. Accretion associated with the
redeemable shares of Class A common stock is excluded from earnings per share as
the redemption value approximates fair value.

Recent Accounting Standards



In August 2020, the FASB issued ASU
No. 2020-06,
Debt-Debt with Conversion and Other Options (Subtopic
470-20)
and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic
815-40):
Accounting for Convertible Instruments and Contracts in an Entity's Own Equity
("ASU
2020-06"),
which simplifies accounting for convertible instruments by removing major
separation models required under current GAAP. The ASU also removes certain
settlement conditions that are required for equity-linked contracts to qualify
for the derivative scope exception, and it simplifies the diluted earnings per
share calculation in certain areas. The Company adopted ASU
2020-06
on January 1, 2021. Adoption of ASU
2020-06
did not impact the Company's financial position, results of operations or cash
flows.

Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on our financial statements.

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