NOTES
TO CONDENSED FINANCIAL STATEMENTS
MARCH
31, 2021
(AS
RESTATED, SEE NOTE 2) (UNAUDITED)
NOTE
1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS
Codere
Online U.S. Corp. (f/k/a DD3 Acquisition Corp. II) was incorporated in Delaware on September 30, 2020. The Company was formed for the
purpose of entering into a merger, capital stock exchange, asset acquisition, stock purchase, recapitalization, reorganization or similar
business combination with one or more businesses or entities (a “Business Combination”).
On
November 30, 2021 (the “Closing Date”), the merger of the Company and Codere Online U.S. Corp., a Delaware corporation (“Merger
Sub”) was completed pursuant to the terms of the Business Combination Agreement, dated June 21, 2021 (the “Business Combination
Agreement”), by and among the Company, Codere Newco, S.A.U., a corporation (sociedad anónima unipersonal) registered
and incorporated under the laws of Spain, Servicios de Juego Online S.A.U., a corporation (sociedad anónima unipersonal)
registered and incorporated under the laws of Spain, Codere Online Luxembourg, S.A., a limited liability company (société
anonyme) governed by the laws of the Grand Duchy of Luxembourg (“Holdco”), and Merger Sub, which among other things provided
for the merger of Merger Sub with and into the Company, with the Company surviving such merger (the “Merger”). In connection
with the consummation of the business combination contemplated by the Business Combination Agreement (the “Transaction”),
“DD3 Acquisition Corp. II” was renamed “Codere Online U.S. Corp.” Also in connection with the consummation of
the Transaction, the Company became a direct, wholly-owned subsidiary of Holdco. References throughout this Amendment No. 1 to the
Quarterly Report on Form 10-Q/A to the “Company,” are to Codere Online U.S. Corp. (f/k/a DD3 Acquisition Corp. II),
unless the context otherwise indicates.
The
Company is not limited to a particular industry or geographic region for purposes of consummating a Business Combination. The Company
is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and
emerging growth companies.
As
of March 31, 2021, the Company had not commenced any operations. All activity for the period from September 30, 2020 (inception) through
March 31, 2021 relates to the Company’s formation and its initial public offering (“Initial Public Offering”), which
is described below. The Company will not generate any operating revenues until after the completion of its initial Business Combination,
at the earliest. The Company will generate non-operating income in the form of interest income from the proceeds derived from the Initial
Public Offering.
The
registration statements for the Company’s Initial Public Offering were declared effective on December 7, 2020. On December 10,
2020, the Company consummated the Initial Public Offering of 12,500,000 units (the “Units” and, with respect to the shares
of Class A common stock included in the Units sold, the “Public Shares”), which includes the partial exercise by the
underwriters of their over-allotment option in the amount of 1,500,000 Units, at $10.00 per Unit, generating gross proceeds of $125,000,000,
which is described in Note 4.
Simultaneously
with the closing of the Initial Public Offering, the Company consummated the sale of an aggregate of 370,000 units (each, a “Private
Unit” and, collectively, the “Private Units”) at a price of $10.00 per Private Unit in a private placement to DD3 Sponsor
Group, LLC (the “Sponsor”) and the Forward Purchase Investors (as defined in Note 5), generating gross proceeds of $3,700,000,
which is described in Note 5.
Transaction
costs amounted to $2,966,508, consisting of $2,500,000 of underwriting fees and $466,508 of other offering costs.
Following
the closing of the Initial Public Offering on December 10, 2020, an amount of $125,000,000 ($10.00 per Unit) from the net proceeds of
the sale of the Units in the Initial Public Offering and the sale of the Private Units was placed in a trust account (the “Trust
Account”), located in the United States and invested only in U.S. government securities, within the meaning set forth in Section 2(a)(16)
of the Investment Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 185 days or less
or in any open-ended investment company that holds itself out as a money market fund selected by the Company meeting the conditions of
Rule 2a-7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) the completion of a Business
Combination and (ii) the distribution of the funds in the Trust Account, as described below.
CODERE
ONLINE U.S. CORP. (f/k/a DD3 ACQUISITION CORP. II)
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH
31, 2021
(AS
RESTATED, SEE NOTE 2) (UNAUDITED)
The
Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering
and the sale of Private Units, although substantially all of the net proceeds are intended to be applied generally toward consummating
a Business Combination. There is no assurance that the Company will be able to complete a Business Combination successfully. The Company
must complete a Business Combination with one or more target businesses that together have an aggregate fair market value of at least
80% of the assets held in the Trust Account (excluding taxes payable on interest earned on the Trust Account) at the time of the agreement
to enter into a Business Combination. The Company will only complete a Business Combination if the post-transaction company owns or acquires
50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient
for it not to be required to register as an investment company under the Investment Company Act.
The
Company will provide its holders of the outstanding Public Shares (the “public stockholders”) with the opportunity to convert
all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a stockholder
meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will
seek stockholder approval of a Business Combination or conduct a tender offer will be made by the Company, solely in its discretion.
The public stockholders will be entitled to convert their Public Shares for a pro rata portion of the amount then in the Trust Account
(initially anticipated to be $10.00 per Public Share, plus any pro rata interest earned on the funds held in the Trust Account and not
previously released to the Company to pay its tax obligations). There will be no conversion rights upon the completion of a Business
Combination with respect to the Company’s warrants.
The
Company will proceed with a Business Combination only if the Company has net tangible assets of at least $5,000,001 either immediately
prior to or upon such consummation of a Business Combination and, if the Company seeks stockholder approval, a majority of the shares
voted are voted in favor of the Business Combination. If a stockholder vote is not required by law and the Company does not decide to
hold a stockholder vote for business or other reasons, the Company will, pursuant to its Amended and Restated Certificate of Incorporation
(the “Amended and Restated Certificate of Incorporation”), conduct the redemptions pursuant to the tender offer rules of
the U.S. Securities and Exchange Commission (“SEC”) and file tender offer documents with the SEC prior to completing a Business
Combination. If, however, stockholder approval of the transaction is required by law, or the Company decides to obtain stockholder approval
for business or other reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy
rules and not pursuant to the tender offer rules. If the Company seeks stockholder approval in connection with a Business Combination,
the Company’s Sponsor, initial stockholders, officers and directors have agreed to vote their Founder Shares (as defined in Note 6),
Private Shares (as defined in Note 5) and any Public Shares purchased during or after the Initial Public Offering in favor of approving
a Business Combination. Additionally, each public stockholder may elect to convert their Public Shares irrespective of whether they vote
for or against the proposed transaction or do not vote at all.
If
the Company seeks stockholder approval of a Business Combination and it does not conduct conversions pursuant to the tender offer rules,
the Amended and Restated Certificate of Incorporation provides that a public stockholder, together with any affiliate of such stockholder
or any other person with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from converting its shares with
respect to more than an aggregate of 15% or more of the Public Shares, without the prior consent of the Company.
The
Company’s Sponsor, initial stockholders, officers and directors have agreed (a) to waive their conversion rights with respect
to any Founder Shares, Private Shares and Public Shares held by them in connection with the completion of a Business Combination or any
amendment to the Amended and Restated Certificate of Incorporation prior thereto and (b) not to propose an amendment to the Amended
and Restated Certificate of Incorporation (i) to modify the substance or timing of the Company’s obligations with respect to conversion
rights as described in the Company’s final prospectus for its Initial Public Offering or (ii) with respect to any other provision
relating to stockholders’ rights or pre-initial Business Combination activity, unless the Company provides the public stockholders
with the opportunity to convert their Public Shares upon approval of any such amendment at a per-share price, payable in cash, equal
to the aggregate amount then on deposit in the Trust Account, including interest (which interest shall be net of taxes payable), divided
by the number of then outstanding Public Shares.
CODERE
ONLINE U.S. CORP. (f/k/a DD3 ACQUISITION CORP. II)
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH
31, 2021
(AS
RESTATED, SEE NOTE 2) (UNAUDITED)
The
Company will have until December 10, 2022 to complete a Business Combination (the “Combination Period”). If the Company is
unable to complete a Business Combination within the Combination Period, the Company will (i) cease all operations except for the
purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the Public
Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account including interest
earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations, divided by the number
of then outstanding Public Shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including
the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption,
subject to the approval of the Company’s remaining stockholders and the Company’s board of directors, dissolve and liquidate,
subject in each case to the Company’s obligations under Delaware law to provide for claims of creditors and the requirements of
other applicable law. There will be no conversion rights or liquidating distributions with respect to the Company’s warrants, which
will expire worthless if the Company fails to complete a Business Combination within the Combination Period.
The
Company’s Sponsor, initial stockholders, officers and directors have agreed to waive their liquidation rights with respect to the
Founder Shares if the Company fails to complete a Business Combination within the Combination Period. However, if the Company’s
Sponsor, initial stockholders, officers or directors acquire Public Shares in or after the Initial Public Offering, such Public Shares
will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination within the
Combination Period. In the event of such distribution, it is possible that the per share value of the assets remaining available for
distribution will be less than the Initial Public Offering price per Unit ($10.00).
In
order to protect the amounts held in the Trust Account, the Sponsor has agreed to be liable to the Company if and to the extent any claims
by a third party for services rendered or products sold to the Company, or a prospective target business with which the Company has discussed
entering into a transaction agreement, reduce the amount of funds in the Trust Account to below (1) $10.00 per Public Share or (2) the
actual amount per Public Share held in the Trust Account as of the date of the liquidation of the Trust Account due to reductions in
the value of the trust assets, in each case net of the interest which may be withdrawn to pay the Company’s taxes. This liability
will not apply with respect to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account
and except as to any claims under the Company’s indemnity of the underwriters of the Initial Public Offering against certain liabilities,
including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Moreover, in the event that an
executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability
for such third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account
due to claims of creditors by endeavoring to have all vendors, service providers (except the Company’s independent registered public
accounting firm), prospective target businesses or other entities with which the Company does business, execute agreements with the Company
waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account.
Liquidity
The Company does not believe
it will need to raise additional funds in order to meet the expenditures required for operating its business. However, if the Company’s
estimate of the costs of identifying a target business, undertaking in-depth due diligence and negotiating a Business Combination are
less than the actual amount necessary to do so, the Company may have insufficient funds available to operate its business prior to a Business
Combination. Moreover, the Company may need to obtain additional financing either to complete its Business Combination or because the
Company become obligated to redeem a significant number of its Public Shares upon consummation of a Business Combination, in which case
the Company may issue additional securities or incur debt in connection with such Business Combination. Subject to compliance with applicable
securities laws, the Company would only complete such financing simultaneously with the completion of a Business Combination. If the Company
is unable to complete a Business Combination because it does not have sufficient funds available to it, the Company will be forced to
cease operations and liquidate the Trust Account. In addition, following a Business Combination, if cash on hand is insufficient, the
Company may need to obtain additional financing in order to meet its obligations. Based on management’s analysis, the Company believes
that it will have sufficient working capital and borrowing capacity to meet its need through the earlier of the consummation of a Business
Combination or one year from the date the financial statements are issued.
Risks
and Uncertainties
Management is currently evaluating
the impact of the COVID-19 pandemic on the industry and has concluded that while it is reasonably possible that the virus could have a
negative effect on the Company’s financial position, results of its operations and/or search for a target company, the specific
impact is not readily determinable as of the date of the financial statements. The financial statements do not include any adjustments
that might result from the outcome of this uncertainty.
CODERE
ONLINE U.S. CORP. (f/k/a DD3 ACQUISITION CORP. II)
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH
31, 2021
(AS
RESTATED, SEE NOTE 2) (UNAUDITED)
NOTE
2. RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS
In
connection with the preparation of the Company’s financial statements as of September 30, 2021, Holdco and the Company have identified
errors made in the Company’s historical financial statements where, at the closing of the Company’s Initial Public Offering,
the Company improperly valued its Class A common stock subject to possible redemption. The Company previously determined the Class A
common stock subject to possible redemption to be equal to the redemption value, while also taking into consideration a redemption cannot
result in net tangible assets being less than $5,000,001. Holdco and the Company have determined that the Public Shares underlying the
Units issued during the Initial Public Offering can be redeemed under circumstances outside the Company’s control. Therefore, Holdco
and the Company have concluded that the redemption value should include all shares of Class A common stock subject to possible redemption,
resulting in the Class A common stock subject to possible redemption being equal to their redemption value. As a result, the Company
has noted a reclassification error related to temporary equity and permanent equity. This resulted in an adjustment to the initial carrying
value of the Class A common stock subject to possible redemption with the offset recorded to additional paid-in capital (to the extent
available), accumulated deficit and Class A common stock.
The
impact of the restatement on the Company’s financial statements is reflected in the following table.
|
|
|
As Previously
|
|
|
|
|
|
|
|
|
Balance Sheet as of March 31, 2021 (unaudited)
|
|
Reported in the Original Filing
|
|
|
Adjustment
|
|
|
As Restated
|
|
|
Class A common stock subject to possible redemption
|
|
$
|
120,326,110
|
|
|
$
|
4,673,890
|
|
|
$
|
125,000,000
|
|
|
Class A common stock
|
|
$
|
84
|
|
|
$
|
(47
|
)
|
|
$
|
37
|
|
|
Additional paid-in capital
|
|
$
|
5,323,232
|
|
|
$
|
(5,323,232
|
)
|
|
$
|
—
|
|
|
Accumulated earnings (deficit)
|
|
$
|
(323,625
|
)
|
|
$
|
649,389
|
|
|
$
|
325,764
|
|
|
Total Stockholders’ Equity (Deficit)
|
|
$
|
5,000,003
|
|
|
$
|
(4,673,890
|
)
|
|
$
|
326,113
|
|
|
Number of shares subject to redemption
|
|
|
12,032,611
|
|
|
|
467,389
|
|
|
|
12,500,000
|
|
|
Class A common stock issued and outstanding
|
|
|
837,389
|
|
|
|
(467,389
|
)
|
|
|
370,000
|
|
|
Statement of Operations for the Three Months Ended March 31, 2021 (unaudited)
|
|
As Previously
Reported in the Original Filing
|
|
|
Adjustment
|
|
|
As Restated
|
|
|
Weighted average shares outstanding of redeemable Class A common stock
|
|
|
12,048,820
|
|
|
|
451,180
|
|
|
|
12,500,000
|
|
|
Basic and diluted net income (loss) per share, redeemable Class A common stock
|
|
$
|
0.00
|
|
|
$
|
(0.01
|
)
|
|
$
|
(0.01
|
)
|
|
Weighted average shares outstanding of nonredeemable Class A and Class B common stock
|
|
|
3,946,180
|
|
|
|
(451,180
|
)
|
|
|
3,495,000
|
|
|
Basic and diluted net income (loss) per share, nonredeemable Class A and Class B common stock
|
|
$
|
(0.04
|
)
|
|
$
|
0.03
|
|
|
$
|
(0.01
|
)
|
CODERE
ONLINE U.S. CORP. (f/k/a DD3 ACQUISITION CORP. II)
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH
31, 2021
(AS
RESTATED, SEE NOTE 2) (UNAUDITED)
|
Statement of Operations for the Six Months Ended March 31, 2021 (unaudited)
|
|
As Previously
Reported in the Original Filing
|
|
|
Adjustment
|
|
|
As Restated
|
|
|
Weighted average shares outstanding of redeemable Class A common stock
|
|
|
12,051,850
|
|
|
|
(4,359,542
|
)
|
|
|
7,692,308
|
|
|
Basic and diluted net income (loss) per share, redeemable Class A common stock
|
|
$
|
0.00
|
|
|
$
|
(0.03
|
)
|
|
$
|
(0.03
|
)
|
|
Weighted average shares outstanding of nonredeemable Class A and Class B common stock
|
|
|
3,533,667
|
|
|
|
(506,524
|
)
|
|
|
3,027,143
|
|
|
Basic and diluted net income (loss) per share, nonredeemable Class A and Class B common stock
|
|
$
|
(0.09
|
)
|
|
$
|
0.06
|
|
|
$
|
(0.03
|
)
|
|
Statement of Cash Flows for the Six Months Ended March 31, 2021 (unaudited)
|
|
As Previously
Reported in the Original Filing
|
|
|
Adjustment
|
|
|
As Restated
|
|
|
Initial classification of Class A common stock subject to possible redemption
|
|
$
|
120,648,340
|
|
|
|
4,351,660
|
|
|
|
125,000,000
|
|
|
Change in value of Class A common stock subject to possible redemption
|
|
$
|
(322,230
|
)
|
|
$
|
322,230
|
|
|
$
|
—
|
|
NOTE
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis
of Presentation
The
accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted
in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q
and Article 10 of Regulation S-X of the SEC. Certain information or footnote disclosures normally included in financial statements
prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial
reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position,
results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed financial statements include
all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating
results and cash flows for the periods presented.
The accompanying unaudited
condensed financial statements should be read in conjunction with the Company’s final prospectus for its Initial Public Offering
as filed with the SEC on December 10, 2020, as well as the Company’s Quarterly Report on Form 10-Q, as filed with the SEC on
February 16, 2021 and restated Quarterly Report on Form 10-Q, as filed with the SEC simultaneously with this filing, as well as the Company’s
Current Reports on Form 8-K, as filed with the SEC on December 11, 2020 and December 16, 2020. The interim results for the three
months ended March 31, 2021 and for the period from September 30, 2020 (inception) through March 31, 2021 are not necessarily indicative
of the results to be expected for period ended September 30, 2021 or for any future periods.
The
Company had no activity for the period ended September 30, 2020 (inception). Accordingly, the condensed balance sheet as of September
30, 2020 is not presented.
CODERE
ONLINE U.S. CORP. (f/k/a DD3 ACQUISITION CORP. II)
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH
31, 2021
(AS
RESTATED, SEE NOTE 2) (UNAUDITED)
Emerging
Growth Company
The
Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart
Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting
requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not
being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley
Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from
the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments
not previously approved.
Further,
Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial
accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective
or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting
standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements
that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of
such extended transition period which means that when a standard is issued or revised and it has different application dates for public
or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies
adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which
is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult
or impossible because of the potential differences in accounting standards used.
Use
of Estimates
The
preparation of the condensed financial statements in conformity with GAAP requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the reporting period.
Making
estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of
a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating
its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ
significantly from those estimates.
Cash
and Cash Equivalents
The
Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents.
The Company did not have any cash equivalents as of March 31, 2021.
Marketable
Securities Held in Trust Account
At
March 31, 2021, substantially all of the assets held in the Trust Account were held in U.S. Treasury Bills.
Class
A Common Stock Subject to Possible Redemption (As Restated, See Note 2)
The
Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards
Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A common stock subject
to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock
(including common stock that features redemption rights that is either within the control of the holder or subject to redemption upon
the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times,
common stock is classified as stockholders’ equity. The Company’s Class A common stock features certain redemption rights
that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at
March 31, 2021, Class A common stock subject to possible redemption is presented at redemption value as temporary equity, outside of
the stockholders’ equity section of the Company’s condensed balance sheet.
CODERE
ONLINE U.S. CORP. (f/k/a DD3 ACQUISITION CORP. II)
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH
31, 2021
(AS
RESTATED, SEE NOTE 2) (UNAUDITED)
Warrant
Liabilities
The
Company accounts for the Private Warrants in accordance with the guidance contained in ASC 815-40, under which the Private Warrants do
not meet the criteria for equity treatment and must be recorded as liabilities. Under ASC 815-40, the Company’s Private Warrants
are not indexed to the Company’s common stock in the manner contemplated by ASC 815-40 because the holder of the instrument is
not an input into the pricing of a fixed-for-fixed option on equity shares. Accordingly, the Company classifies the Private Warrants
as liabilities at their fair value and adjusts the Private Warrants to fair value at each reporting period. These liabilities are subject
to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in the statement of operations.
The Private Warrants are valued using a binomial lattice model.
Income
Taxes
The
Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax
assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements
carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured
using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered
or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included
the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be
realized.
FASB
ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax
positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than
not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized
tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of March
31, 2021. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material
deviation from its position.
The
Company may be subject to potential examination by federal, state and city taxing authorities in the areas of income taxes. These potential
examinations may include questioning the timing and amount of deductions, the nexus of income among various tax jurisdictions and compliance
with federal, state and city tax laws. The Company’s management does not expect that the total amount of unrecognized tax benefits
will materially change over the next twelve months.
Net
Loss Per Common Share (As Restated, See Note 2)
Net
loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the
period. Shares of common stock subject to possible redemption at March 31, 2021, which are not currently redeemable and are not redeemable
at fair value, have been excluded from the calculation of basic net loss per common share since such shares, if redeemed, only participate
in their pro rata share of the Trust Account earnings. The Company has not considered the effect of the warrants sold in the Initial
Public Offering or the effect of warrants underlying the 370,000 Units sold in the private placement in the calculation of diluted loss
per common share, since the exercise of the warrants is contingent upon the occurrence of future events and the inclusion of such warrants
would be anti-dilutive. As a result, diluted net loss per common share is the same as basic net loss per common share for the periods
presented.
The
Company’s statement of operations includes a presentation of net earnings (loss) per share of common stock subject to possible
redemption and allocates the net income (loss) into the two classes of stock in calculating net earnings (loss) per common share, basic
and diluted. For Class A redeemable common stock, net earnings (loss) per common share is calculated by dividing the net loss by the
weighted average number of Class A common stock subject to possible redemption outstanding since original issuance. For Class B non-redeemable
common stock, net earnings (loss) per common share is calculated by dividing the net loss by the weighted average number of Class B nonredeemable
common stock outstanding for the period. Class B non-redeemable common stock includes the Founder Shares as these shares do not have
any redemption features and do not participate in the income earned on the Trust Account.
CODERE
ONLINE U.S. CORP. (f/k/a DD3 ACQUISITION CORP. II)
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH
31, 2021
(AS
RESTATED, SEE NOTE 2) (UNAUDITED)
The
following table reflects the calculation of basic and diluted net loss per common share (in dollars, except per share amounts):
|
|
|
Three Months Ended
March 31,
2021
|
|
|
For the
Period from
September 30, 2020
(Inception) Through
March 31,
2021
|
|
|
Class A common stock subject to possible redemption
|
|
|
|
|
|
|
|
|
|
Numerator: Earnings attributable to Class A common stock subject to possible redemption
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(125,805
|
)
|
|
$
|
(232,234
|
)
|
|
Net loss attributable to Class A common stock subject to possible redemption
|
|
$
|
(125,805
|
)
|
|
$
|
(232,234
|
)
|
|
Denominator: Weighted average Class A common stock subject to possible redemption
|
|
|
|
|
|
|
|
|
|
Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption
|
|
|
12,500,000
|
|
|
|
7,692,308
|
|
|
Basic and diluted net loss per share, Class A common stock subject to possible redemption
|
|
$
|
(0.01
|
)
|
|
$
|
(0.03
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Non-Redeemable Class A and Class B common stock
|
|
|
|
|
|
|
|
|
|
Numerator: Net loss minus net earnings
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(35,175
|
)
|
|
$
|
(91,391
|
)
|
|
Non-redeemable net loss
|
|
$
|
(35,175
|
)
|
|
$
|
(91,391
|
)
|
|
Denominator: Weighted average non-redeemable Class A and Class B common stock
|
|
|
|
|
|
|
|
|
|
Basic and diluted weighted average shares outstanding, non-redeemable Class A and Class B common stock
|
|
|
3,495,000
|
|
|
|
3,027,143
|
|
|
Basic and diluted net loss per share, non-redeemable Class A and Class B common stock
|
|
$
|
(0.01
|
)
|
|
$
|
(0.03
|
)
|
Concentration
of Credit Risk
Financial
instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution,
which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on this
account.
Fair
Value of Financial Instruments
The
fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value
Measurement,” approximates the carrying amounts represented in the condensed balance sheet, primarily due to their short-term nature,
excluding the Private Warrants (see Note 10).
Recent
Accounting Standards
Management
does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect
on the Company’s condensed financial statements.
CODERE
ONLINE U.S. CORP. (f/k/a DD3 ACQUISITION CORP. II)
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH
31, 2021
(AS
RESTATED, SEE NOTE 2) (UNAUDITED)
NOTE
4. INITIAL PUBLIC OFFERING
Pursuant
to the Initial Public Offering, the Company sold 12,500,000 Units, which includes a partial exercise by the underwriters of their over-allotment
option in the amount of 1,500,000 Units, at a price of $10.00 per Unit. Each Unit consists of one share of Class A common stock
and one-half of one redeemable warrant (“Public Warrant”). Each whole Public Warrant entitles the holder to purchase one
share of Class A common stock at a price of $11.50 per share, subject to adjustment (see Note 9).
NOTE
5. PRIVATE PLACEMENT
Simultaneously
with the closing of the Initial Public Offering, the Sponsor and the Forward Purchase Investors purchased an aggregate of 370,000 Private
Units at a price of $10.00 per Private Unit, for an aggregate purchase price of $3,700,000, in a private placement. The Sponsor purchased
an aggregate of 296,000 Private Units and Forward Purchase Investors purchased an aggregate of 74,000 Private Units. Each Private Unit
consists of one share of Class A common stock (“Private Share”) and one-half of one redeemable warrant (“Private
Warrant”). Each whole Private Warrant entitles the holder to purchase one share of Class A common stock at a price of $11.50
per share, subject to adjustment (see Note 9). A portion of the proceeds from the Private Units were added to the proceeds from the Initial
Public Offering held in the Trust Account. The Private Units are identical to the Units sold in the Initial Public Offering, except as
described in Note 9. If the Company does not complete a Business Combination within the Combination Period, the proceeds of the
sale of the Private Units will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and
underlying securities will be worthless.
Certain
funds affiliated with Baron Capital Group, Inc., which are members of the Sponsor, and MG Partners Multi-Strategy Fund LP (collectively,
the “Forward Purchase Investors”) have entered into contingent forward purchase agreements with the Company as described
in Note 7.
NOTE
6. RELATED PARTY TRANSACTIONS
Founder
Shares
On
October 13, 2020, the Sponsor purchased 2,875,000 shares (the “Founder Shares”) of the Company’s Class B common stock
for an aggregate price of $25,000. On December 7, 2020, the Company effected a stock dividend of 287,500 shares with respect to the Class
B common stock, resulting in an aggregate of 3,162,500 Founder Shares issued and outstanding. All share and per-share amounts have been
retroactively restated to reflect the stock dividend effectuated on December 7, 2020. The Founder Shares included an aggregate of up
to 412,500 shares subject to forfeiture to the extent that the underwriters’ over-allotment option was not exercised in full or
in part, so that the initial stockholders would own, on an as-converted basis, 20.0% of the Company’s issued and outstanding shares
after the Initial Public Offering (excluding the Private Shares). As a result of the underwriters’ election to partially exercise
their over-allotment option, a total of 375,000 Founder Shares are no longer subject to forfeiture and 37,500 Founder Shares were forfeited,
resulting in an aggregate of 3,125,000 Founder Shares issued and outstanding.
The
Company’s Sponsor, initial stockholders, officers and directors have agreed, subject to certain limited exceptions, not to transfer,
assign or sell any of the Founder Shares until the earlier of one year after the date of the consummation of a Business Combination and
the date on which the closing price of the Class A common stock equals or exceeds $12.50 per share (as adjusted for stock splits, stock
dividends, reorganizations and recapitalizations) for any 20 trading days within a 30-trading day period commencing 150 days after a
Business Combination, or earlier if, subsequent to a Business Combination, the Company completes a liquidation, merger, stock exchange
or other similar transaction which results in all of the Company’s stockholders having the right to exchange their shares of common
stock for cash, securities or other property.
Due
from Sponsor
As
of December 10, 2020, the Company advanced the Sponsor an aggregate of $25,000, which is included in prepaid expenses in the accompanying
condensed balance sheet. The outstanding balance of the $25,000 due was repaid on January 11, 2021.
CODERE
ONLINE U.S. CORP. (f/k/a DD3 ACQUISITION CORP. II)
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH
31, 2021
(AS
RESTATED, SEE NOTE 2) (UNAUDITED)
Administrative
Services Agreement
The
Company entered into an agreement, commencing on December 7, 2020 through the earlier of the Company’s consummation of a Business
Combination and its liquidation, to pay the Sponsor a total of up to $10,000 per month for office space, utilities and administrative
support. For the three months ended March 31, 2021 and for the period from September 30, 2020 (inception) through March 31, 2021, the
Company incurred $30,000 and $40,000, respectively, in fees for these services, of which $20,000 is included in accrued expenses in the
accompanying condensed balance sheet at March 31, 2021.
Promissory
Note — Related Party
On
October 13, 2020, the Company issued an unsecured promissory note to the Sponsor (the “Promissory Note”), pursuant to which
the Company could borrow up to an aggregate principal amount of $150,000. The Promissory Note was non-interest bearing and payable on
the earlier of (i) March 31, 2021 or (ii) the consummation of the Initial Public Offering. The outstanding balance under the
Promissory Note of $105,747 was repaid at the closing of the Initial Public Offering on December 10, 2020.
Related
Party Loans
In
order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain
of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working
Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the
proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside
the Trust Account. In the event that a Business Combination does not close, the Company 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. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements
exist with respect to such loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without
interest, or, at the lender’s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into units of the post-Business
Combination entity at a price of $10.00 per unit. The units would be identical to the Private Units.
NOTE
7. COMMITMENTS
Registration
Rights Agreement
Pursuant
to a registration rights agreement entered into on December 7, 2020, the holders of the Founder Shares, Private Units, Private Shares,
Private Warrants, the units that may be issued upon conversion of Working Capital Loans, the shares of Class A common stock and the warrants
issued as part of such units (and any shares of Class A common stock issuable upon the exercise of the Private Warrants and warrants
included as part of the units that may be issued upon conversion of Working Capital Loans and upon conversion of the Founder Shares)
will be entitled to registration rights. The holders of a majority of these securities are entitled to make up to two demands that the
Company register such securities. The holders of the majority of the Founder Shares can elect to exercise these registration rights at
any time commencing three months prior to the date on which the Founder Shares are to be released from escrow. The holders of a majority
of the Private Units and units issued to the Sponsor, officers, directors, initial stockholders or their affiliates in payment of Working
Capital Loans made to the Company (or underlying securities) can elect to exercise these registration rights at any time after the Company
consummates a Business Combination. In addition, the holders have certain “piggy-back” registration rights with respect to
registration statements filed subsequent to the consummation of a Business Combination. The registration rights agreement does not contain
liquidated damages or other cash settlement provisions resulting from delays in registering such securities. The Company will bear the
expenses incurred in connection with the filing of any such registration statements.
Underwriting
Agreement
The
underwriters were paid a cash underwriting discount of $0.20 per Unit, or $2,500,000 in the aggregate, payable upon the closing of the
Initial Public Offering.
CODERE
ONLINE U.S. CORP. (f/k/a DD3 ACQUISITION CORP. II)
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH
31, 2021
(AS
RESTATED, SEE NOTE 2) (UNAUDITED)
Business
Combination Marketing Agreement
The
Company engaged the underwriters as an advisor in connection with a Business Combination to assist the Company in holding meetings with
its shareholders to discuss the potential Business Combination and the target business’ attributes, introduce the Company to potential
investors that are interested in purchasing the Company’s securities in connection with a Business Combination, provide financial
advisory services to assist the Company in the Company’s efforts to obtain any stockholder approval for the Business Combination
and assist the Company with its press releases and public filings in connection with the Business Combination. The Company will pay the
underwriters a cash fee for such services upon the consummation of a Business Combination in an amount equal to, in the aggregate, 3.5%
of the gross proceeds of Initial Public Offering (exclusive of any applicable finders’ fees which might become payable).
Forward
Purchase Agreements
The
Forward Purchase Investors entered into contingent forward purchase agreements with the Company as of November 17, 2020 and November
19, 2020, which provide for the purchase by the Forward Purchase Investors of an aggregate of up to 5,000,000 shares of Class A common
stock, at a price of $10.00 per share, for total gross proceeds of up to $50,000,000. These shares would be purchased in a private placement
to close simultaneously with the consummation of the Company’s Business Combination. These issuances would be made pursuant to
the exemption from registration contained in Section 4(a)(2) of the Securities Act.
NOTE
8. STOCKHOLDERS’ EQUITY (AS RESTATED, SEE NOTE 2)
Preferred
Stock — The Company is authorized to issue 1,000,000 shares of preferred stock with a par value of $0.0001 per share with
such designations, voting and other rights and preferences as may be determined from time to time by the Company’s board of directors.
At March 31, 2021, there were no shares of preferred stock issued or outstanding.
Class
A Common Stock — The Company is currently authorized to issue up to 100,000,000 shares of Class A common stock with a par
value of $0.0001 per share. Holders of Class A common stock are entitled to one vote for each share. At March 31, 2021, there were 12,870,000
shares of Class A common stock issued and outstanding, including 12,500,000 shares of Class A common stock subject to possible redemption.
Class
B Common Stock — The Company is currently authorized to issue up to 10,000,000 shares of Class B common stock with a par
value of $0.0001 per share. Holders of Class B common stock are entitled to one vote for each share. At March 31, 2021, there were 3,125,000
shares of Class B common stock issued and outstanding.
Only
holders of Class B common stock have the right to vote on the election of directors prior to a Business Combination. Holders of Class A
common stock and Class B common stock will vote together as a single class on all other matters submitted to a vote of stockholders,
except as required by law.
The
shares of Class B common stock will automatically convert into shares of Class A common stock at the time of a Business Combination,
or at any time prior thereto at the option of the holder, on a one-for-one basis, subject to adjustment. In the case that additional
shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in the Initial
Public Offering and related to the closing of a Business Combination, the ratio at which shares of Class B common stock shall convert
into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock
agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock
issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum
of the total number of all shares of common stock outstanding upon the completion of the Initial Public Offering (not including the shares
of Class A common stock underlying the Private Units) plus all shares of Class A common stock and equity-linked securities issued or
deemed issued in connection with a Business Combination (excluding any shares or equity-linked securities issued, or to be issued, to
any seller in a Business Combination and any additional units issued to the Sponsor, officers, directors, initial stockholders or their
affiliates in payment of Working Capital Loans made to the Company). The Company cannot determine at this time whether a majority of
the holders of the Class B common stock at the time of any future issuance would agree to waive such adjustment to the conversion ratio.
CODERE
ONLINE U.S. CORP. (f/k/a DD3 ACQUISITION CORP. II)
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH
31, 2021
(AS
RESTATED, SEE NOTE 2) (UNAUDITED)
NOTE
9. WARRANTS
Public
Warrants may only be exercised for a whole number of shares. No fractional shares will be issued upon exercise of the Public Warrants.
The Public Warrants will become exercisable on the later of (a) 30 days after the consummation of a Business Combination or (b)
December 10, 2021. The Public Warrants will expire five years after the consummation of a Business Combination or earlier upon redemption
or liquidation.
The
Company may redeem the Public Warrants (excluding the Private Warrants and any warrants underlying units issued upon conversion of the
Working Capital Loans):
|
|
●
|
in
whole and not in part;
|
|
|
●
|
at
a price of $0.01 per warrant;
|
|
|
●
|
at
any time after the warrants become exercisable;
|
|
|
●
|
upon
not less than 30 days’ prior written notice of redemption to each warrant holder;
|
|
|
●
|
if,
and only if, the reported last sale price of the shares of Class A common stock equals or exceeds $18.00 per share (as adjusted for
stock splits, stock dividends, reorganizations and recapitalizations), for any 20 trading days within a 30 trading day
commencing at any time after the warrants become exercisable and ending on the third business day prior to the notice of redemption
to warrant holders; and
|
|
|
●
|
if,
and only if, there is a current registration statement in effect with respect to the shares of Class A common stock underlying the
warrants.
|
If
and when the warrants become redeemable by the Company, the Company may exercise its redemption right even if it is unable to register
or qualify the underlying securities for sale under all applicable state securities laws.
If
the Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise the
Public Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of shares
of Class A common stock issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of
a stock dividend, or recapitalization, reorganization, merger or consolidation. However, except as described below, the warrants will
not be adjusted for issuances of Class A common stock at a price below its exercise price. Additionally, in no event will the Company
be required to net cash settle the warrants. If the Company is unable to complete a Business Combination within the Combination Period
and the Company liquidates the funds held in the Trust Account, holders of warrants will not receive any of such funds with respect to
their warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with the respect
to such warrants. Accordingly, the warrants may expire worthless.
In
addition, if (x) the Company issues additional shares of Class A common stock or equity-linked securities for capital raising purposes
in connection with the closing of its initial Business Combination at an issue price or effective issue price of less than $9.20 per
share of Class A common stock (with such issue price or effective issue price to be determined in good faith by the Company’s board
of directors and, in the case of any such issuance to the Sponsor, initial stockholders or their affiliates, without taking into account
any Founder Shares held by the Sponsor, initial stockholders or their affiliates, as applicable, prior to such issuance) (the “Newly
Issued Price”), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and
interest thereon, available for the funding of the Company’s initial Business Combination on the date of the consummation of such
initial Business Combination (net of redemptions), and (z) the volume weighted average trading price of the Class A common stock during
the 20 trading day period starting on the trading day prior to the day on which the Company consummates its initial Business Combination
(such price, the “Market Value”) is below $9.20 per share, then the exercise price of the warrants will be adjusted (to the
nearest cent) to be equal to 115% of the greater of (i) the Market Value or (ii) the Newly Issued Price, and the $18.00 per share redemption
trigger price of the warrants will be adjusted (to the nearest cent) to be equal to 180% of the greater of (i) the Market Value or (ii)
the Newly Issued Price.
The
Private Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private
Warrants and the shares of Class A common stock issuable upon the exercise of the Private Warrants will not be transferable, assignable
or salable until after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Warrants
will be exercisable on a cashless basis and will be non-redeemable so long as they are held by the initial purchasers or their permitted
transferees. If the Private Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private
Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants.
CODERE
ONLINE U.S. CORP. (f/k/a DD3 ACQUISITION CORP. II)
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH
31, 2021
(AS
RESTATED, SEE NOTE 2) (UNAUDITED)
NOTE
10. FAIR VALUE MEASUREMENTS
The
Company follows the guidance in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each
reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually.
The
fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would
have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction
between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company
seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable
inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is
used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and
liabilities:
|
|
Level 1:
|
Quoted
prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions
for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.
|
|
|
|
|
|
|
Level 2:
|
Observable
inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities
and quoted prices for identical assets or liabilities in markets that are not active.
|
|
|
|
|
|
|
Level 3:
|
Unobservable
inputs based on the Company’s assessment of the assumptions that market participants would use in pricing the asset or liability.
|
The
following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring
basis at March 31, 2021, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:
|
Description
|
|
Level
|
|
|
March 31,
2021
|
|
|
Assets:
|
|
|
|
|
|
|
|
|
Marketable securities held in Trust Account
|
|
1
|
|
|
$
|
125,040,112
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
Warrant Liability – Private Warrants
|
|
3
|
|
|
$
|
190,550
|
|
The
Private Warrants are accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities on
the accompanying condensed balance sheet. The Private Warrants are measured at fair value at inception and on a recurring basis,
with changes in fair value presented in the condensed statement of operations.
The
Private Warrants were valued using a binomial lattice model, which is considered to be a Level 3 fair value measurement. The binomial
lattice model’s primary unobservable input utilized in determining the fair value is the expected volatility of the common stock.
The expected volatility as of the valuation dates was implied from the Company’s own Public Warrant pricing.
CODERE
ONLINE U.S. CORP. (f/k/a DD3 ACQUISITION CORP. II)
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH
31, 2021
(AS
RESTATED, SEE NOTE 2) (UNAUDITED)
The
following table presents the quantitative information regarding Level 3 fair value measurements of the warrant liability as of March
31, 2021:
|
Risk-free interest rate
|
|
|
0.92
|
%
|
|
Effective expiration date
|
|
|
4/25/2026
|
|
|
Dividend yield
|
|
|
0.00
|
%
|
|
Expected volatility
|
|
|
17.1
|
%
|
|
Exercise price
|
|
$
|
11.50
|
|
|
One-touch hurdle
|
|
$
|
18.15
|
|
|
Unit Price
|
|
$
|
9.76
|
|
The
following table presents the changes in the fair value of Private Warrants:
|
Fair value as of September 30, 2020 (inception)
|
|
$
|
—
|
|
|
Initial classification on December 10, 2020 (As Restated)
|
|
|
109,150
|
|
|
Change in fair value (As Restated)
|
|
|
74,000
|
|
|
Fair value as of December 31, 2020 (As Restated)
|
|
|
183,150
|
|
|
Change in fair value
|
|
|
7,400
|
|
|
Fair value as of March 31, 2021
|
|
$
|
190,550
|
|
There
were no transfers in or out of Level 3 from other levels in the fair value hierarchy during the three months ended March 31, 2021.
NOTE
11. SUBSEQUENT EVENTS
The
Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the condensed financial
statements were issued. Based upon this review, the Company did not identify any subsequent events that would have required adjustment
or disclosure in the condensed financial statements.
