General form of registration statement for all companies including face-amount certificate companies

RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

v3.21.1
RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS
12 Months Ended
Dec. 31, 2020
RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS  
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 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 or exchange offer made to and accepted by holders of more than 50% of the outstanding shares of a single class of common shares, all holders of the warrants would be entitled to receive cash for their warrants (the "tender offer provision").

On April 12, 2021, the SEC released a Staff Statement on Accounting and Reporting Considerations for Warrants Issued by Special Purpose Acquisition Companies (the "SEC Staff Statement"). Specifically, the SEC Staff 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 governing our warrants. Following the SEC Staff 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 and after discussion with the Company's independent registered public accounting firm, concluded that the Company's Private Placement Warrants are not indexed to the Company's common shares 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 and after discussion with the Company's independent registered public accounting firm, concluded the tender offer provision included in the warrant agreement fails the "classified in shareholders' 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 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 operating expenses, cash flows or cash.

 

 

 

 

 

 

 

 

 

 

 

    

 

 

    

Period

    

 

 

Balance Sheet as of September 17, 2019

 

As Reported

 

Adjustment

 

As Adjusted

Warrant Liability

 

$

 —

 

$

18,300,000

 

$

18,300,000

Class A common stock subject to possible redemption

 

 

261,909,820

 

 

(18,300,000)

 

 

243,609,820

Class A common stock

 

 

131

 

 

183

 

 

314

Additional paid-in capital

 

$

5,000,481

 

$

636,486

 

$

5,636,967

Accumulated deficit

 

$

(1,297)

 

$

(636,669)

 

$

(637,966)

Total Stockholders’ Equity

 

$

5,000,003

 

$

 0

 

$

5,000,003

 

 

 

  

 

 

  

 

 

  

Number of shares subject to possible redemption

 

 

26,190,982

 

 

(1,830,000)

 

 

24,360,982

 

 

 

  

 

 

  

 

 

  

 

 

 

  

 

 

  

 

 

  

Balance Sheet as of September 30, 2019

 

 

 

 

 

 

 

 

 

Warrant Liability

 

$

 —

 

$

17,966,667

 

$

17,966,667

Class A common stock subject to possible redemption

 

 

262,009,255

 

 

(17,966,667)

 

 

244,042,588

Class A common stock

 

 

131

 

 

180

 

 

311

Additional paid-in capital

 

$

4,901,046

 

$

303,156

 

$

5,204,202

Retained earnings (Accumulated deficit)

 

 

98,139

 

 

(303,336)

 

 

(205,197)

Total Stockholders’ Equity

 

$

5,000,004

 

$

 —

 

$

5,000,004

 

 

 

  

 

 

  

 

 

  

Number of shares subject to possible redemption

 

 

26,187,385

 

 

(1,795,738)

 

 

24,391,647

 

 

 

  

 

 

  

 

 

  

 

 

 

  

 

 

  

 

 

  

Balance Sheet as of December 31, 2019

 

 

 

 

 

 

 

 

 

Warrant Liability

 

$

 —

 

$

16,116,667

 

$

16,116,667

Class A common stock subject to possible redemption

 

 

262,695,890

 

 

(16,116,667)

 

 

246,579,223

Class A common stock

 

 

132

 

 

161

 

 

293

Additional paid-in capital

 

$

4,214,410

 

$

(1,546,825)

 

$

2,667,585

Retained earnings

 

$

784,778

 

$

1,546,664

 

$

2,331,442

Total Stockholders’ Equity

 

$

5,000,008

 

$

 —

 

$

5,000,008

 

 

 

  

 

 

  

 

 

  

Number of shares subject to possible redemption

 

 

26,180,927

 

 

(1,606,227)

 

 

24,574,700

 

 

 

 

 

 

 

 

 

 

 

 

    

 

 

    

 

 

    

 

 

 

 

 

 

 

 

 

 

 

 

Statement of Operations for the period from May 24, 2019 (Inception)through
September 30, 2019

 

 

 

 

 

 

 

 

 

Transaction costs allocable to warrant liabilities

 

 

 —

 

 

(636,669)

 

 

(636,669)

Change in fair value of warrant liabilities

 

 

 —

 

 

333,333

 

 

333,333

Net income (loss)

 

$

98,139

 

$

(303,336)

 

$

(205,197)

Basic and diluted weighted average shares outstanding, common stock

 

 

6,444,901

 

 

 —

 

 

6,444,901

Basic and diluted net loss per common share, common stock

 

$

0.01

 

$

(0.05)

 

$

(0.05)

 

 

 

 

 

 

 

 

 

 

Statement of Operations for the year ended December 31, 2019

 

 

 

 

 

 

 

 

 

Transaction costs allocable to warrant liabilities

 

 

 —

 

 

(636,669)

 

 

(636,669)

Change in fair value of warrant liabilities

 

 

 —

 

 

2,218,333

 

 

2,218,333

Net income

 

$

784,778

 

$

1,546,664

 

$

2,331,442

Basic and diluted weighted average shares outstanding, common stock

 

 

7,170,375

 

 

855,194

 

 

8,025,569

Basic and diluted net income (loss) per common share, common stock

 

$

(0.01)

 

$

0.20

 

$

0.19

Basic and diluted weighted average shares outstanding, Common
stock subject to possible redemptio

 

 

26,187,830

 

 

(1,799,980)

 

 

24,387,850

 

SUMMARY FINANCIAL STATEMENT IMPACT

 (Preliminary, unaudited)

 

 

 

 

 

 

 

 

 

 

 

    

 

 

 

    

Period

    

 

Balance Sheet as of March 31, 2020

 

 

As Reported

 

Adjustment

 

As Restated

Warrant Liability

 

$

 —

 

$

10,991,667

 

$

10,991,667

Class A common stock subject to possible redemption

 

 

263,267,961

 

 

(10,991,667)

 

 

252,276,294

Class A common stock

 

 

134

 

 

110

 

 

244

Additional paid-in capital

 

$

3,642,337

 

$

(6,671,774)

 

$

(3,029,437)

Retained earnings

 

$

1,356,849

 

$

6,671,664

 

$

8,028,513

Total Stockholders’ Equity

 

$

5,000,008

 

$

 —

 

$

5,000,008

 

 

 

  

 

 

  

 

 

  

Number of shares subject to possible redemption

 

 

26,163,140

 

 

(1,092,334)

 

 

25,070,806

 

 

 

  

 

 

  

 

 

  

 

 

 

  

 

 

  

 

 

  

Balance Sheet as of June 30, 2020

 

 

 

 

 

 

 

 

 

Warrant Liability

 

$

 —

 

$

13,500,000

 

$

13,500,000

Class A common stock subject to possible redemption

 

 

263,261,986

 

 

(13,500,000)

 

 

249,761,986

Class A common stock

 

 

134

 

 

135

 

 

269

Additional paid-in capital

 

$

3,648,312

 

$

(4,163,466)

 

$

(515,154)

Retained earnings

 

$

1,350,867

 

$

4,163,331

 

$

5,514,198

Total Stockholders’ Equity

 

$

5,000,001

 

$

 —

 

$

5,000,001

 

 

 

  

 

 

  

 

 

  

Number of shares subject to possible redemption

 

 

26,156,915

 

 

(1,341,319)

 

 

24,815,596

 

 

 

  

 

 

  

 

 

  

 

 

 

  

 

 

  

 

 

  

Balance Sheet as of September 30, 2020

 

 

 

 

 

 

 

 

 

Warrant Liability

 

$

 —

 

$

18,525,000

 

$

18,525,000

Class A common stock subject to possible redemption

 

 

263,161,825

 

 

(18,525,000)

 

 

244,636,825

Class A common stock

 

 

136

 

 

185

 

 

321

Additional paid-in capital

 

$

3,748,471

 

$

861,484

 

$

4,609,955

Retained earnings

 

$

1,250,712

 

$

(861,669)

 

$

389,043

Total Stockholders’ Equity

 

$

5,000,007

 

$

 —

 

$

5,000,007

 

 

 

  

 

 

  

 

 

  

Number of shares subject to possible redemption

 

 

26,141,235

 

 

(1,840,185)

 

 

24,301,050

 

 

 

  

 

 

  

 

 

  

 

 

 

  

 

 

  

 

 

  

Balance Sheet as of December 31, 2020

 

 

 

 

 

 

 

 

 

Warrant Liability

 

$

 —

 

$

36,766,667

 

$

36,766,667

Class A common stock subject to possible redemption

 

 

262,823,607

 

 

(36,766,668)

 

 

226,056,939

Class A common stock

 

 

136

 

 

366

 

 

502

Additional paid-in capital

 

$

4,086,689

 

$

19,102,971

 

$

23,189,660

Retained earnings (Accumulated deficit)

 

$

912,496

 

$

(19,103,336)

 

$

(18,190,840)

Total Stockholders’ Equity

 

$

5,000,009

 

$

 1

 

$

5,000,010

 

 

 

  

 

 

  

 

 

  

Number of shares subject to possible redemption

 

 

26,136,620

 

 

(3,656,279)

 

 

22,480,341

 

 

 

 

 

 

 

 

 

 

 

Statement of Operations for the period ended March 31, 2020

 

 

 

 

 

 

 

 

 

Change in fair value of warrant liabilities

 

 

 —

 

 

5,125,000

 

 

5,125,000

Net income

 

$

572,071

 

$

5,125,000

 

$

5,697,071

Basic and diluted weighted average shares outstanding, common stock

 

 

8,194,073

 

 

 —

 

 

8,194,073

Basic and diluted net income per common share, common stock

 

$

 —

 

$

0.63

 

$

0.63

 

 

 

 

 

 

 

 

 

 

 

 

 

  

 

 

  

 

 

  

Statement of Operations for the period ended June 30, 2020

 

 

 

 

 

 

 

 

 

Change in fair value of warrant liabilities

 

 

 —

 

 

2,616,667

 

 

2,616,667

Net income

 

$

566,089

 

$

2,616,667

 

$

3,182,756

Basic and diluted weighted average shares outstanding, common stock

 

 

8,202,967

 

 

 —

 

 

8,202,967

Basic and diluted net income (loss) per common share, common stock

 

$

(0.02)

 

$

0.32

 

$

0.30

 

 

 

 

 

 

 

 

 

 

 

 

 

  

 

 

  

 

 

  

Statement of Operations for the period ended September 30, 2020

 

 

 

 

 

 

 

 

 

Change in fair value of warrant liabilities

 

 

 —

 

 

(2,408,333)

 

 

(2,408,333)

Net income (loss)

 

$

 465,934

 

$

 (2,408,333)

 

$

 (1,942,399)

Basic and diluted weighted average shares outstanding, common stock

 

 

8,208,043

 

 

 —

 

 

8,208,043

Basic and diluted net loss per common share, common stock

 

$

(0.03)

 

$

(0.29)

 

$

(0.32)

 

 

 

 

 

 

 

 

 

 

 

 

 

  

 

 

  

 

 

  

Statement of Operations for the year ended December 31, 2020

 

 

 

 

 

 

 

 

 

Change in fair value of warrant liabilities

 

 

 —

 

 

(20,650,000)

 

 

(20,650,000)

Net income (loss)

 

$

127,718

 

$

(20,650,000)

 

$

(20,522,282)

Basic and diluted weighted average shares outstanding, common stock

 

 

8,214,508

 

 

1,470,676

 

 

9,685,184

Basic and diluted net loss per common share, common stock

 

$

(0.05)

 

$

(2.12)

 

$

(2.17)

Basic and diluted weighted average shares outstanding, Common stock subject to possible redemption

 

 

26,160,492

 

 

(1,470,676)

 

 

24,689,816