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Item 1A. Risk Factors

2022-03-14 compared with 2021-03-08 · 639 added, 2842 removed, 15 unchanged (100% of the section changed)

Risk Factors.

An investment in our securities involves

a high degree of risk.

You should consider carefully all of the risks described below, together with the other information contained

in this Annual Report on Form 10-K, before making a decision to invest in our units.

If any of the following events occur, our business, financial

condition and operating results may be materially adversely affected.

In that event, the trading price of our securities could

decline, and you could lose all or part of your investment.

For risks relating to Archer and

the Business Combination, please see the “Risk Factors - Risks Related to Archer’s Business and Industry and

New Archer Following the Business Combination”.

Risks Related to Our Business and

Corporate Structure

We are a blank check company with no

operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective.

We are a blank check company incorporated

under the laws of the State of Delaware with no operating results.

Because we lack an operating history, you have no basis upon

which to evaluate our ability to achieve our business objective of completing our initial business combination.

We may be unable

to complete our initial business combination , including the Business

Combination with Archer, which is subject to numerous closing conditions and may be terminated by either party in certain circumstances,

some of which are outside of our control.

For a description of the terms of the Business Combination Agreement and related

agreements, including, the closing conditions and termination provisions, please see "Business —Business

Combination Agreement."

If we fail to complete our initial business combination, we will never generate any operating revenues.

Our amended and restated certificate

of incorporation will require, to the fullest extent permitted by law, that derivative actions brought in our name, actions against

our directors, officers, other employees or stockholders for breach of fiduciary duty and certain other actions may be brought

only in the Court of Chancery in the State of Delaware and, if brought outside of Delaware, the stockholder bringing the suit will,

subject to certain exceptions, be deemed to have consented to service of process on such stockholder’s counsel, which may

have the effect of discouraging lawsuits against our directors, officers, other employees or stockholders.

Our amended and restated certificate of

incorporation will require, to the fullest extent permitted by law, that derivative actions brought in our name, actions against

our directors, officers, other employees or stockholders for breach of fiduciary duty and certain other actions may be brought

only in the Court of Chancery in the State of Delaware and, if brought outside of Delaware, the stockholder bringing the suit will

be deemed to have consented to service of process on such stockholder’s counsel except any action (A) as to which the

Court of Chancery in the State of Delaware determines that there is an indispensable party not subject to the jurisdiction of the

Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten

days following such determination), (B) which is vested in the exclusive jurisdiction of a court or forum other than the Court

of Chancery or (C) for which the Court of Chancery does not have subject matter jurisdiction.

Any person or entity purchasing

or otherwise acquiring any interest in shares of our capital stock shall be deemed to have notice of and consented to the forum

provisions in our amended and restated certificate of incorporation.

This choice of forum provision may limit or make more costly

a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or any of our directors,

officers, other employees or stockholders, which may discourage lawsuits with respect to such claims.

Alternatively, if a court

were to find the choice of forum provision contained in our amended and restated certificate of incorporation to be inapplicable

or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which

could harm our business, operating results and financial condition.

Our amended and restated certificate

of incorporation provides that the exclusive forum provision are applicable to the fullest extent permitted by applicable

law, subject to certain exceptions.

Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits

brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder.

the exclusive forum provision does not apply to suits brought to enforce any duty or liability created by the Exchange Act or

any other claim for which the federal courts have exclusive jurisdiction.

In addition, our amended and restated certificate

of incorporation provides that, unless we consent in writing to the selection of an alternative forum, the federal district

courts of the United States of America shall, to the fullest extent permitted by law, be the exclusive forum for the

resolution of any complaint asserting a cause of action arising under the Securities Act of 1933, as amended, or the rules

and regulations promulgated thereunder.

We note, however, that there is uncertainty as to whether a court would enforce this

provision and that investors cannot waive compliance with the federal securities laws and the rules and regulations

Section 22 of the Securities Act creates concurrent jurisdiction for state and federal courts over all suits

brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder.

Risks Related to Our Initial Business

Our search for a business combination,

and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the

recent coronavirus (“COVID-19”) outbreak.

In December 2019, a novel strain of

coronavirus has and is continuing to spread throughout parts of the world, including the United States.

On January 30, 2020,

the World Health Organization declared the outbreak of the coronavirus disease (COVID-19) a “Public Health Emergency of International

Concern.”

On January 31, 2020, U.S.

Health and Human Services Secretary Alex M.

Azar II declared a public health emergency

for the United States to aid the U.S.

healthcare community in responding to COVID-19, and on March 11, 2020 the World Health

Organization characterized the outbreak as a “pandemic”.

A significant outbreak of COVID-19 and other infectious diseases

could result in a widespread health crisis that could adversely affect the economies and financial markets worldwide, and the business

of any potential target business with which we consummate a business combination could be materially and adversely affected.

we may be unable to complete a business combination if continued concerns relating to COVID-19 restrict travel, limit the ability

to have meetings with potential investors or the target company’s personnel, vendors and services providers are unavailable

to negotiate and consummate a transaction in a timely manner.

The extent to which COVID-19 impacts our search for a business combination

will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge

concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others.

If the disruptions posed

by COVID-19 or other matters of global concern continue for an extended period of time, our ability to consummate a business combination,

or the operations of a target business with which we ultimately consummate a business combination, such as the business combination

with Archer, may be materially adversely affected.

In addition, our ability to consummate a transaction may be dependent on the

ability to raise equity or debt financing which may be impacted by COVID-19 and other events, including as a result of increased

market volatility, decreased market liquidity in third-party financing being unavailable on terms acceptable to us or at all.

Our public stockholders may not be afforded

an opportunity to vote on our proposed initial business combination, and even if we hold a vote, holders of our founder shares

will participate in such vote, which means we may complete our initial business combination even though a majority of our public

stockholders do not support such a combination.

If the Business Combination is not

consummated and we seek to enter into a business combination with other target companies, we may choose not to hold a stockholder

vote to approve our initial business combination unless the initial business combination would require stockholder approval under

applicable law or stock exchange listing requirements or if we decide to hold a stockholder vote for business or other legal reasons.

Except as required by law or the rules of the NYSE, the decision as to whether we will seek stockholder approval of a proposed

initial business combination or will allow stockholders to sell their shares to us in a tender offer will be made by us, solely

in our discretion, and will be based on a variety of factors, such as the timing of the transaction and whether the terms of the

transaction would otherwise require us to seek stockholder approval.

Even if we seek stockholder approval, the holders of our founder

shares will participate in the vote on such approval.

Accordingly, we may complete our initial business combination even if holders

of a majority of our public shares do not approve of the initial business combination we complete.

If we seek stockholder approval of our

initial business combination, our initial stockholders and management team have agreed to vote in favor of such initial business

combination, regardless of how our public stockholders vote.

Our initial stockholders own 20% of

our outstanding common stock.

Our initial stockholders and management team also may from time to time purchase Class A

common stock prior to our initial business combination.

Our amended and restated certificate of incorporation provides that,

if we seek stockholder approval of an initial business combination, such initial business combination will be approved if we

receive the affirmative vote of a majority of the shares voted at such meeting, including the founder shares.

As a result, in

addition to our initial stockholders’

founder shares, we would need 18,750,001, or 37.5%, of the 50,000,000 public

shares sold in our Initial Public Offering to be voted in favor of an initial business combination in order to have our

initial business combination approved (assuming all outstanding shares are voted and the over-allotment option is not

Accordingly, if we seek stockholder approval of our initial business combination, the agreement by our initial

stockholders and management team to vote in favor of our initial business combination will increase the likelihood that we

will receive the requisite stockholder approval for such initial business combination.

Your only opportunity to affect the

investment decision regarding a potential business combination may be limited to the exercise of your right to redeem your shares

from us for cash.

At the time of your investment in us, you

will not be provided with an opportunity to evaluate the specific merits or risks of our initial business combination.

we are seeking stockholder approval of the Arrival Business Combination, if such transaction is not consummated and we seek to

enter into a business combination with other target companies, our Board of Directors may complete such business combination without

seeking stockholder approval, public stockholders may not have the right or opportunity to vote on the business combination, unless

we seek such stockholder vote.

Accordingly, your only opportunity to affect the investment decision regarding our initial business

combination may be limited to exercising your redemption rights within the period of time (which will be at least 20 business days)

set forth in our tender offer documents mailed to our public stockholders in which we describe our initial business combination.

The ability of our public stockholders

to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which

may make it difficult for us to enter into a business combination with a target.

We may seek to enter into a business combination

transaction agreement with minimum cash requirement for (i) cash consideration to be paid to the target or its owners, (ii) cash

for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions.

those circumstances, if too many public stockholders exercise their redemption rights, we would not be able to meet such closing

condition and, as a result, would not be able to proceed with the business combination.

Furthermore, in no event will we redeem

our public shares in an amount that would cause our net tangible assets to be less than $5,000,001.

Consequently, if accepting

all properly submitted redemption requests would cause our net tangible assets to be less than $5,000,001 or make us unable to

satisfy a minimum cash condition as described above, we would not proceed with such redemption and the related business combination

and may instead search for an alternate business combination.

Prospective targets will be aware of these risks and, thus, may be

reluctant to enter into a business combination transaction with us.

The ability of our public stockholders

to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business

combination or optimize our capital structure.

At the time we enter into an

agreement for our initial business combination, we will not know how many stockholders may exercise their redemption rights,

and therefore will need to structure the transaction based on our expectations as to the number of shares that will be

submitted for redemption.

If our initial business combination agreement requires us to use a portion of the cash in the trust

account to pay the purchase price, or requires us to have a minimum amount of cash at closing, we will need to reserve a

portion of the cash in the trust account to meet such requirements, or arrange for third party financing.

In addition, if a

larger number of shares is submitted for redemption than we initially expected, we may need to restructure the transaction to

reserve a greater portion of the cash in the trust account or arrange for third party financing.

Raising additional third

party financing may involve dilutive equity issuances or the incurrence of indebtedness at higher than desirable levels.

Furthermore, this dilution would increase to the extent that the anti-dilution provision of the Class B common stock

results in the issues of shares of Class A common stock on a greater than one-to-one basis upon conversion of the shares

of Class B common stock at the time of our initial business combination.

In addition, the amount of the Marketing Fee

payable to the representative of the underwriters and Moelis will not be adjusted for any shares that are redeemed in

connection with an initial business combination.

The per share amount we will distribute to stockholders who properly

exercise their redemption rights will not be reduced by the Marketing Fee and after such redemptions, the amount held in

trust will continue to reflect our obligation to pay the entire Marketing Fee.

The above considerations may limit our ability

to complete the most desirable business combination available to us or optimize our capital structure.

Combination with Archer does not require us to use a portion of the cash in the trust account to meet such requirements.

have arranged for third party financing.

The ability of our public stockholders

to exercise redemption rights with respect to a large number of our shares could increase the probability that our initial business

combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your shares.

If our initial business combination agreement

requires us to use a portion of the cash in the trust account to pay the purchase price, or requires us to have a minimum amount

of cash at closing, the probability that our initial business combination would be unsuccessful is increased.

If our initial business

combination is unsuccessful, you would not receive your pro rata portion of the trust account until we liquidate the trust account.

If you are in need of immediate liquidity, you could attempt to sell your shares in the open market;

however, at such time our

shares may trade at a discount to the pro rata amount per share in the trust account.

In either situation, you may suffer a material

loss on your investment or lose the benefit of funds expected in connection with your exercise of redemption rights until we liquidate

or you are able to sell your shares in the open market.

The requirement that we complete our

initial business combination within 24 months after our Initial Public Offering may give potential target businesses leverage over

us in negotiating a business combination and may limit the time we have in which to conduct due diligence on potential business

combination targets, in particular as we approach our dissolution deadline, which could undermine our ability to complete our initial

business combination on terms that would produce value for our stockholders.

Any potential target business with which

we enter into negotiations concerning a business combination will be aware that we must complete our initial business combination

within 24 months from the closing of our Initial Public Offering.

Consequently, such target business may obtain leverage over us

in negotiating a business combination, knowing that if we do not complete our initial business combination with that particular

target business, we may be unable to complete our initial business combination with any target business.

This risk will increase

as we get closer to the timeframe described above.

In addition, we may have limited time to conduct due diligence and may enter

into our initial business combination on terms that we would have rejected upon a more comprehensive investigation.

We may not be able to complete our initial

business combination within 24 months of our Initial Public Offering, in which case we would cease all operations except for the

purpose of winding up and we would redeem our public shares and liquidate.

We may not be able to complete the Business

Combination or, if the Business Combination does not consummate, find another suitable target business within 24 months after the

closing of our Initial Public Offering.

Our ability to complete the Business Combination or any other initial business combination

may be negatively impacted by general market conditions, volatility in the capital and debt markets and the other risks described

If we have not completed our initial business combination within such time period, we 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 (which interest shall be net of taxes payable and up to $100,000

of interest to pay dissolution expenses), 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 our remaining

stockholders and our board of directors, liquidate and dissolve, subject in each case, to our obligations under Delaware law to

provide for claims of creditors and the requirements of other applicable law.

If we seek stockholder approval of our

initial business combination, our sponsor, initial stockholders, directors, executive officers and their affiliates may elect to

purchase shares or public warrants from public stockholders, which may influence a vote on a proposed business combination and

reduce the public “float”

of our Class A common stock.

If we seek stockholder approval of our

initial business combination (such as the Business Combination) and we do not conduct redemptions in connection with our

initial business combination pursuant to the tender offer rules, our sponsor, initial stockholders, directors, executive officers

or their affiliates may purchase shares or public warrants in privately negotiated transactions or in the open market either prior

to or following the completion of our initial business combination, although they are under no obligation to do so.

limit on the number of shares our initial stockholders, directors, officers or their affiliates may purchase in such transactions,

subject to compliance with applicable law and the NYSE rules.

However, other than as expressly stated herein, they have no current

commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions.

None of the funds in the trust account will be used to purchase shares or public warrants in such transactions.

Such purchases

may include a contractual acknowledgment that such stockholder, although still the record holder of our shares, is no longer the

beneficial owner thereof and therefore agrees not to exercise its redemption rights.

In the event that our sponsor, initial

stockholders, directors, executive officers or their affiliates purchase shares in privately negotiated transactions from public

stockholders who have already elected to exercise their redemption rights, such selling stockholders would be required to revoke

their prior elections to redeem their shares.

The purpose of any such purchases of shares could be to vote such shares in favor

of the business combination and thereby increase the likelihood of obtaining stockholder approval of the business combination or

to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of

cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met.

purpose of any such purchases of public warrants could be to reduce the number of public warrants outstanding or to vote such warrants

on any matters submitted to the warrant holders for approval in connection with our initial business combination.

Any such purchases

of our securities may result in the completion of our initial business combination that may not otherwise have been possible.

expect any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such

purchasers are subject to such reporting requirements.

In addition, if such purchases are made,

the public “float”

of our Class A common stock or public warrants and the number of beneficial holders of our

securities may be reduced, possibly making it difficult to obtain or maintain the quotation, listing or trading of our securities

on a national securities exchange.

If a public stockholder fails to receive

notice of our offer to redeem our public shares in connection with our initial business combination, or fails to comply with the

procedures for tendering its shares, such shares may not be redeemed.

We will comply with the proxy rules or

tender offer rules, as applicable, when conducting redemptions in connection with our initial business combination.

compliance with these rules, if a stockholder fails to receive our proxy materials or tender offer documents, as applicable, such

stockholder may not become aware of the opportunity to redeem its shares.

In addition, proxy materials or tender offer documents,

as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will describe

the various procedures that must be complied with in order to validly tender or submit public shares for redemption.

we intend to require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold

their shares in “street name,”

to, at the holder’s option, either deliver their stock certificates to our transfer

agent, or to deliver their shares to our transfer agent electronically prior to the date set forth in the proxy materials or tender

offer documents, as applicable.

In the case of proxy materials, this date may be up to two business days prior to the vote on the

proposal to approve the initial business combination.

In addition, if we conduct redemptions in connection with a stockholder vote,

we intend to require a public stockholder seeking redemption of its public shares to also submit a written request for redemption

to our transfer agent two business days prior to the vote in which the name of the beneficial owner of such shares is included.

In the event that a stockholder fails to comply with these or any other procedures disclosed in the proxy or tender offer materials,

as applicable, its shares may not be redeemed.

If we seek stockholder approval of our

initial business combination and we do not conduct redemptions pursuant to the tender offer rules, and if you or a “group”

of stockholders are deemed to hold in excess of 15% of our Class A common stock, you will lose the ability to redeem all such

shares in excess of 15% of our Class A common stock.

If we seek stockholder approval of our

initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to

the tender offer rules, our 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 Exchange Act), will be restricted from seeking redemption rights with respect to more

than an aggregate of 15% of the shares sold in our Initial Public Offering without our prior consent, which we refer to as the

“Excess Shares.”

However, we would not be restricting our stockholders’

ability to vote all of their shares (including

Excess Shares) for or against our initial business combination.

Your inability to redeem the Excess Shares will reduce your influence

over our ability to complete our initial business combination and you could suffer a material loss on your investment in us if

you sell Excess Shares in open market transactions.

Additionally, you will not receive redemption distributions with respect to

the Excess Shares if we complete our initial business combination.

And as a result, you will continue to hold that number of shares

exceeding 15% and, in order to dispose of such shares, would be required to sell your shares in open market transactions, potentially

Because of our limited resources and

the significant competition for business combination opportunities, it may be more difficult for us to complete our initial business

If we are unable to complete our initial business combination, our public stockholders may receive only their pro

rata portion of the funds in the trust account that are available for distribution to public stockholders, and our warrants will

expire worthless.

We expect to encounter competition from

other entities having a business objective similar to ours, including private investors (which may be individuals or investment

partnerships), other blank check companies and other entities, domestic and international, competing for the types of businesses

we intend to acquire.

Many of these individuals and entities are well-established and have extensive experience in identifying

and effecting, directly or indirectly, acquisitions of companies operating in or providing services to various industries.

of these competitors possess similar or greater technical, human and other resources to ours or more local industry knowledge than

we do and our financial resources will be relatively limited when contrasted with those of many of these competitors.

believe there are numerous target businesses we could potentially acquire with the net proceeds of our Initial Public Offering

and the sale of the private placement warrants, our ability to compete with respect to the acquisition of certain target businesses

that are sizable will be limited by our available financial resources.

This inherent competitive limitation gives others an advantage

in pursuing the acquisition of certain target businesses.

Furthermore, we are obligated to offer holders of our public shares the

right to redeem their shares for cash at the time of our initial business combination in conjunction with a stockholder vote or

via a tender offer.

Target companies will be aware that this may reduce the resources available to us for our initial business

Any of these obligations may place us at a competitive disadvantage in successfully negotiating a business combination.

If we are unable to complete our initial business combination, our public stockholders may receive only their pro rata portion

of the funds in the trust account that are available for distribution to public stockholders, and our warrants will expire worthless.

Subsequent to our completion of our

initial business combination, we may be required to take write-downs or write-offs, restructuring and impairment or other charges

that could have a significant negative effect on our financial condition, results of operations and the price of our securities,

which could cause you to lose some or all of your investment.

Even if we conduct extensive due diligence

on a target business with which we combine, we cannot assure you that this diligence will identify all material issues that may

be present with a particular target business, that it would be possible to uncover all material issues through a customary amount

of due diligence, or that factors outside of the target business and outside of our control will not later arise, including, without

limitation, in connection with the Business Combination.

As a result of these factors, we may be forced to later write-down or

write-off assets, restructure our operations, or incur impairment or other charges that could result in our reporting losses.

Even if our due diligence successfully identifies certain risks, unexpected risks may arise and previously known risks may materialize

in a manner not consistent with our preliminary risk analysis.

Even though these charges may be non-cash items and not have an

immediate impact on our liquidity, the fact that we report charges of this nature could contribute to negative market perceptions

about us or our securities.

In addition, charges of this nature may cause us to violate net worth or other covenants to which

we may be subject as a result of assuming pre-existing debt held by a target business or by virtue of our obtaining debt financing

to partially finance the initial business combination or thereafter.

Accordingly, any stockholders or warrant holders who choose

to remain stockholders or warrant holders following the business combination could suffer a reduction in the value of their securities.

Such stockholders or warrant holders are unlikely to have a remedy for such reduction in value unless they are able to successfully

claim that the reduction was due to the breach by our officers or directors of a duty of care or other fiduciary duty owed to

them, or if they are able to successfully bring a private claim under securities laws that the proxy materials or tender offer

documents, as applicable, relating to the business combination contained an actionable material misstatement or material omission.

Changes in laws or regulations, or a

failure to comply with any laws and regulations, may adversely affect our business, including our ability to negotiate and complete

our initial business combination, and results of operations.

We are subject to laws and regulations

enacted by national, regional and local governments.

In particular, we are required to comply with certain SEC and other legal

requirements.

Compliance with, and monitoring of, applicable laws and regulations may be difficult, time consuming and costly.

Those laws and regulations and their interpretation and application may also change from time to time and those changes could have

a material adverse effect on our business, investments and results of operations.

In addition, a failure to comply with applicable

laws or regulations, as interpreted and applied, could have a material adverse effect on our business, including our ability to

negotiate and complete our initial business combination, and results of operations.

The grant of registration rights to

our initial stockholders and holders of our private placement warrants may make it more difficult to complete our initial business

combination, and the future exercise of such rights may adversely affect the market price of our shares of Class A common

Pursuant to an agreement to be entered

into concurrently with the issuance and sale of the securities in our Initial Public Offering, our initial stockholders and their

permitted transferees can demand that we register the shares of Class A common stock into which founder shares are convertible,

holders of our private placement warrants and their permitted transferees can demand that we register the private placement warrants

and the Class A common stock issuable upon exercise of the private placement warrants and holders of warrants that may be

issued upon conversion of working capital loans may demand that we register such warrants or the Class A common stock issuable

upon conversion of such warrants.

The registration rights will be exercisable with respect to the founder shares and the private

placement warrants and the Class A common stock issuable upon exercise of such private placement warrants.

We will bear the

cost of registering these securities.

The registration and availability of such a significant number of securities for trading

in the public market may have an adverse effect on the market price of our Class A common stock.

In addition, the existence

of the registration rights may make our initial business combination more costly or difficult to conclude.

This is because the

stockholders of the target business may increase the equity stake they seek in the combined entity or ask for more cash consideration

to offset the negative impact on the market price of our Class A common stock that is expected when the shares of common stock

owned by our initial stockholders, holders of our private placement warrants or holders of our working capital loans or their respective

permitted transferees are registered.

Because we are neither limited to evaluating

a target business in a particular industry sector nor have we selected any specific target businesses with which to pursue our

initial business combination, you will be unable to ascertain the merits or risks of any particular target business’s operations.

Our efforts to identify a prospective

initial business combination target will not be limited to a particular industry, sector or geographic region.

pursue an initial business combination opportunity in any industry or sector, we intend to capitalize on the ability of our

management team to identify, acquire and operate a business or businesses that can benefit from our management team’s

established global relationships and operating experience.

Our management team has extensive experience in identifying and

executing strategic investments globally and has done so successfully in a number of sectors.

Our amended and restated

certificate of incorporation prohibits us from effectuating a business combination with another blank check company or

similar company with nominal operations.

Because we have not yet selected any specific target business with respect to a

business combination, there is no basis to evaluate the possible merits or risks of any particular target business’s

operations, results of operations, cash flows, liquidity, financial condition or prospects.

To the extent we complete our

initial business combination, we may be affected by numerous risks inherent in the business operations with which we combine.

For example, if we combine with a financially unstable business or an entity lacking an established record of sales or

earnings, we may be affected by the risks inherent in the business and operations of a financially unstable or a development

stage entity.

Although our officers and directors will endeavor to evaluate the risks inherent in a particular target

business, we cannot assure you that we will properly ascertain or assess all of the significant risk factors or that we will

have adequate time to complete due diligence.

Furthermore, some of these risks may be outside of our control and leave us

with no ability to control or reduce the chances that those risks will adversely impact a target business.

We also cannot

assure you that an investment in our units will ultimately prove to be more favorable to investors than a direct investment,

if such opportunity were available, in a business combination target.

Accordingly, any stockholders or warrant holders who

choose to remain stockholders or warrant holders following the business combination could suffer a reduction in the value of

their securities.

Such stockholders or warrant holders are unlikely to have a remedy for such reduction in value unless they

are able to successfully claim that the reduction was due to the breach by our officers or directors of a duty of care or

other fiduciary duty owed to them, or if they are able to successfully bring a private claim under securities laws that the

proxy materials or tender offer documents, as applicable, relating to the business combination contained an actionable

material misstatement or material omission.

We may seek business combination opportunities

in industries or sectors that may be outside of our management’s areas of expertise.

As of the date of this Report, we

have considered, and will continue to consider if the Business Combination is not consummated, a business combination outside

of our management’s areas of expertise if a business combination candidate is presented to us and we determine that

such candidate offers an attractive business combination opportunity for our company.

Although our management will endeavor

to evaluate the risks inherent in any particular business combination candidate, we cannot assure you that we will adequately

ascertain or assess all of the significant risk factors, especially risks in connection with target businesses in industries

outside of our management’s area of expertise.

We also cannot assure you that an investment in our units will not

ultimately prove to be less favorable to investors in our Initial Public Offering than a direct investment, if an opportunity

were available, in a business combination candidate.

In the event we elect to pursue a business combination outside of the

areas of our management’s expertise, our management’s expertise may not be directly applicable to its evaluation

or operation, and our management’s expertise would not be relevant to an understanding of the business that we elect to

As a result, our management may not be able to ascertain or assess adequately all of the relevant risk factors.

Accordingly, any stockholders who choose to remain stockholders following our initial business combination could suffer a

reduction in the value of their shares.

Such stockholders are unlikely to have a remedy for such reduction in value.

Although we have identified general

criteria and guidelines that we believe are important in evaluating prospective target businesses, we may enter into our initial

business combination with a target that does not meet such criteria and guidelines, and as a result, the target business with which

we enter into our initial business combination may not have attributes entirely consistent with our general criteria and guidelines.

Although we have identified general criteria

and guidelines for evaluating prospective target businesses, it is possible that a target business, such as Archer, with which

we enter into our initial business combination will not have all of these attributes.

If we complete our initial business combination

with a target that does not meet some or all of these guidelines, such combination may not be as successful as a combination with

a business that does meet all of our general criteria and guidelines.

In addition, if we announce a prospective business combination

with a target that does not meet our general criteria and guidelines, a greater number of stockholders may exercise their redemption

rights, which may make it difficult for us to meet any closing condition with a target business that requires us to have a minimum

net worth or a certain amount of cash.

In addition, if stockholder approval of the transaction is required by law, or we decide

to obtain stockholder approval for business or other legal reasons, it may be more difficult for us to attain stockholder approval

of our initial business combination if the target business does not meet our general criteria and guidelines.

If we are unable

to complete our initial business combination, our public stockholders may only receive their pro rata portion of the funds in the

trust account that are available for distribution to public stockholders, and our warrants will expire worthless.

We are not required to obtain an opinion

from an independent investment banking firm or from a valuation or appraisal firm, and consequently, you may have no assurance

from an independent source that the price we are paying for the business is fair to us from a financial point of view.

We are not required to obtain an opinion

from an independent investment banking firm which is a member of FINRA or from a valuation or appraisal firm that the price we

are paying is fair to us from a financial point of view.

If no opinion is obtained, our stockholders will be relying on the judgment

of our board of directors, who will determine fair market value based on standards generally accepted by the financial community.

Such standards used will be disclosed in our proxy materials or tender offer documents, as applicable, related to our initial business

We may issue additional shares of Class A

common stock or shares of preferred stock to complete our initial business combination or under an employee incentive plan after

completion of our initial business combination.

We may also issue shares of Class A common stock upon the conversion of the

founder shares at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution

provisions contained in our amended and restated certificate of incorporation.

Any such issuances would dilute the interest of

our stockholders and likely present other risks.

Our amended and restated certificate of

incorporation authorizes the issuance of up to 200,000,000 shares of Class A common stock, par value $0.0001 per share, 20,000,000

shares of Class B common stock, par value $0.0001 per share, and 1,000,000 shares of preferred stock, par value $0.0001 per

Immediately after our Initial Public Offering, there were 150,000,000 and 7,500,000 (assuming in each case that the underwriters

have not exercised their over-allotment option and the forfeiture of 1,875,000 shares of Class B common stock) authorized

but unissued shares of Class A common stock and Class B common stock, respectively, available for issuance which amount

does not take into account shares reserved for issuance upon exercise of outstanding warrants or shares issuable upon conversion

of the Class B common stock.

The Class B common stock is automatically convertible into Class A common stock upon

the consummation of our initial business combination, initially at a one-for-one ratio but subject to adjustment as set forth herein

and in our amended and restated certificate of incorporation.

Immediately after our Initial Public Offering, there will be no shares

of preferred stock issued and outstanding.

We may issue a substantial number of additional

shares of Class A common stock or shares of preferred stock to complete our initial business combination or under an employee

incentive plan after completion of our initial business combination.

We may also issue shares of Class A common stock upon

conversion of the Class B common stock at a ratio greater than one-to-one at the time of our initial business combination

as a result of the anti-dilution provisions as set forth therein.

However, our amended and restated certificate of incorporation

provides, among other things, that prior to our initial business combination, we may not issue additional shares that would entitle

the holders thereof to (i) receive funds from the trust account or (ii) vote as a class with our public shares (a) on

any initial business combination or (b) to approve an amendment to our amended and restated certificate of incorporation to

(x) extend the time we have to consummate a business combination beyond 24 months from the closing of our Initial Public Offering

or (y) amend the foregoing provisions.

These provisions of our amended and restated certificate of incorporation, like all

provisions of our amended and restated certificate of incorporation, may be amended with a stockholder vote.

The issuance of additional

shares of common stock or shares of preferred stock:

may significantly dilute the equity interest of investors

in our Initial Public Offering;

may subordinate the rights of holders of Class A

common stock if shares of preferred stock are issued with rights senior to those afforded our Class A common stock;

could cause a change in control if a substantial number

of shares of Class A common stock is issued, which may affect, among other things, our ability to use our net operating loss

carry forwards, if any, and could result in the resignation or removal of our present officers and directors;

may adversely affect prevailing market prices for our

units, Class A common stock and/or warrants.

Resources could be wasted in researching

business combinations that are not completed, which could materially adversely affect subsequent attempts to locate and acquire

or merge with another business.

If we are unable to complete our initial business combination, our public stockholders may only

receive their pro rata portion of the funds in the trust account that are available for distribution to public stockholders, and

our warrants will expire worthless.

We anticipate that the investigation of

each specific target business and the negotiation, drafting and execution of relevant agreements, disclosure documents and other

instruments will require substantial management time and attention and substantial costs for accountants, attorneys and others.

If we decide not to complete a specific initial business combination, the costs incurred up to that point for the proposed transaction

likely would not be recoverable.

Furthermore, if we reach an agreement relating to a specific target business, we may fail to complete

our initial business combination for any number of reasons including those beyond our control.

Any such event will result in a

loss to us of the related costs incurred which could materially adversely affect subsequent attempts to locate and acquire or merge

with another business.

If we are unable to complete our initial business combination, our public stockholders may only receive

their pro rata portion of the funds in the trust account that are available for distribution to public stockholders, and our warrants

will expire worthless.

Our ability to successfully effect our

initial business combination and to be successful thereafter will be dependent upon the efforts of our key personnel, some of whom

may join us following our initial business combination.

The loss of key personnel could negatively impact the operations and profitability

of our post-combination business.

Our ability to successfully effect our

initial business combination is dependent upon the efforts of our key personnel.

The role of our key personnel in the target business,

however, cannot presently be ascertained.

Although some of our key personnel may remain with the target business in senior management

or advisory positions following our initial business combination, it is likely that some or all of the management of the target

business will remain in place.

While we intend to closely scrutinize any individuals we engage after our initial business combination,

we cannot assure you that our assessment of these individuals will prove to be correct.

These individuals may be unfamiliar with

the requirements of operating a company regulated by the SEC, which could cause us to have to expend time and resources helping

them become familiar with such requirements.

Our key personnel may negotiate employment

or consulting agreements with a target business in connection with a particular business combination, and a particular business

combination may be conditioned on the retention or resignation of such key personnel.

These agreements may provide for them to

receive compensation following our initial business combination and as a result, may cause them to have conflicts of interest in

determining whether a particular business combination is the most advantageous.

Our key personnel may be able to remain

with our company after the completion of our initial business combination only if they are able to negotiate employment or consulting

agreements in connection with the business combination.

Such negotiations would take place simultaneously with the negotiation

of the business combination and could provide for such individuals to receive compensation in the form of cash payments and/or

our securities for services they would render to us after the completion of the business combination.

Such negotiations also could

make such key personnel’s retention or resignation a condition to any such agreement.

The personal and financial interests

of such individuals may influence their motivation in identifying and selecting a target business, subject to their fiduciary duties

under Delaware law.

We may have a limited ability to assess

the management of a prospective target business and, as a result, may affect our initial business combination with a target business

whose management may not have the skills, qualifications or abilities to manage a public company.

When evaluating the desirability of

effecting our initial business combination with a prospective target business, our ability to assess the target

business’s management may be limited due to a lack of time, resources or information.

Our assessment of the

capabilities of the target business’s management, therefore, may prove to be incorrect and such management may lack the

skills, qualifications or abilities we suspected.

Should the target business’s management not possess the skills,

qualifications or abilities necessary to manage a public company, the operations and profitability of the post-combination

business may be negatively impacted.

Accordingly, any stockholders or warrant holders who choose to remain stockholders or

warrant holders following the business combination could suffer a reduction in the value of their securities.

stockholders or warrant holders are unlikely to have a remedy for such reduction in value unless they are able to

successfully claim that the reduction was due to the breach by our officers or directors of a duty of care or other fiduciary

duty owed to them, or if they are able to successfully bring a private claim under securities laws that the proxy

solicitation or tender offer materials, as applicable, relating to the business combination contained an actionable material

misstatement or material omission.

The officers and directors of an acquisition

candidate may resign upon completion of our initial business combination.

The loss of a business combination target’s key

personnel could negatively impact the operations and profitability of our post-combination business.

The role of an acquisition candidate’s

key personnel upon the completion of our initial business combination cannot be ascertained at this time.

Although we contemplate

that certain members of an acquisition candidate’s management team will remain associated with the acquisition candidate

following our initial business combination, it is possible that members of the management of an acquisition candidate will not

wish to remain in place.

Our executive officers and directors

will allocate their time to other businesses thereby causing conflicts of interest in their determination as to how much time to

devote to our affairs.

This conflict of interest could have a negative impact on our ability to complete our initial business combination.

Our executive officers and directors are

not required to, and will not, commit any period of time to our affairs, which may result in a conflict of interest in allocating

their time between our operations and our search for a business combination and their other businesses.

We do not intend to have

any full-time employees prior to the completion of our initial business combination.

Each of our executive officers is engaged

in several other business endeavors for which he may be entitled to substantial compensation, and our executive officers are not

obligated to contribute any specific number of hours per week to our affairs.

Our independent directors also serve as officers

and board members for other entities.

If our executive officers’

and directors’

other business affairs require them

to devote substantial amounts of time to such affairs in excess of their current commitment levels, it could limit their ability

to devote time to our affairs which may have a negative impact on our ability to complete our initial business combination.

a complete discussion of our executive officers’

and directors’

other business affairs, please see “Directors,

Executive Officers and Corporate Governance —

Conflicts of Interest.”

Our officers and directors presently

have, and any of them in the future may have additional, fiduciary, contractual or other obligations to other entities and clients

of other entities and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity

should be presented.

Until we consummate our initial

business combination, we intend to engage in the business of identifying and combining with one or more businesses.

our officers and directors presently has, and any of them in the future may have additional fiduciary, contractual or other

obligations to other entities, including, without limitation AC SPACS, or to clients of Moelis or other affiliates of our

sponsor pursuant to which such officer or director is or will be required to present a business combination opportunity.

example, affiliates of our sponsor also founded the AC SPACs, each a blank check company incorporated as a

Delaware corporation for the purpose of effecting its own initial business combination.

Moelis is the Chairman of

the Board of Directors of each of the AC SPACs, and certain of our other officers are officers or directors, respectively, of

the AC SPACs, and each of the foregoing owe fiduciary duties under Delaware law to the AC SPACs.

In addition, Mr.

the Chairman of the Board and CEO of Moelis & Company and he owes fiduciary duties to Moelis & Company.

if any of our officers or director becomes aware of a business combination opportunity which is suitable for an entity to

which he or she has then current fiduciary, contractual or other obligations, including any AC SPAC, he or she will honor his

or her fiduciary, contractual or other obligations to present such opportunity to such entity and only present it to us if

such entity rejects the opportunity and he or she determines to present the opportunity to us (including as described above).

For example, a business combination opportunity may be suitable for one or more of the AC SPACs and us and our officers and

directors may choose to direct such opportunity to one or more of the AC SPACs before presenting to our company, meaning we

could find less suitable acquisition opportunities and could limit our ability to find a business combination that we find

These conflicts may not be resolved in our favor and a potential target business may be presented to another

entity prior to its presentation to us.

However, we do not believe that the fiduciary duties or contractual obligations of

our officers or directors will materially affect our ability to complete our business combination.

In the event we seek to complete our

initial business combination with a company that is affiliated with, or which there is a fiduciary, contractual or other

obligation by, our sponsor, officers or directors, we, or a committee of independent directors, may obtain an opinion from an

independent investment banking firm which is a member of the Financial Industry Regulatory Authority, or FINRA, or an

independent accounting firm that the consideration to be paid by us in initial business combination is fair to our company

from a financial point of view.

Any such entity may co-invest with us in the target business at the time of our initial

business combination, or we could raise additional proceeds to complete the acquisition by making a specified future issuance

to any such entity.

Our certificate of incorporation will provide

that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly

offered to such person solely in his or her capacity as a director or officer of the company and such opportunity is one we are

legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director

or officer is permitted to refer that opportunity to us without violating another legal obligation without violating another legal

In addition, our sponsor and our officers

and directors may sponsor or form other special purpose acquisition companies similar to ours or may pursue other business or investment

ventures, even prior to us entering into a definitive agreement for our initial business combination.

Any such companies, businesses

or investments may present additional conflicts of interest in pursuing an initial business combination.

However, we do not believe

that any such potential conflicts would materially affect our ability to complete our initial business combination.

We may engage in a business combination

with one or more target businesses that have relationships with entities that may be affiliated with our sponsor, executive officers,

directors or existing holders which may raise potential conflicts of interest.

In light of the involvement of our

sponsor, executive officers and directors with other entities, we may decide to acquire one or more businesses affiliated

with our sponsor, executive officers, directors or existing holders.

Our directors also serve as officers and board members

for other entities, including, without limitation, those described under “Directors, Executive Officers and Corporate

Governance —

Conflicts of Interest.”

Such entities or clients of entities may compete with us for business

combination opportunities.

Our sponsor, officers and directors are not currently aware of any specific opportunities for us

to complete our initial business combination with any entities with which they are affiliated, and there have been no

substantive discussions concerning a business combination with any such entity or entities.

Although we will not be

specifically focusing on, or targeting, any transaction with any affiliated entities, we would pursue such a transaction if

we determined that such affiliated entity met our criteria for a business combination as set forth in “Proposed

Business —

Investing Criteria”

as set forth in our Prospectus dated October 27, 2020 filed with the SEC in

connection with our IPO and such transaction was approved by a majority of our independent and disinterested directors.

Despite our choosing to obtain an opinion from an independent investment banking firm which is a member of FINRA or a

valuation or appraisal firm regarding the fairness to our company from a financial point of view of the consideration to be

paid by us in a business combination with one or more domestic or international businesses affiliated with our sponsor,

executive officers, directors or existing holders, potential conflicts of interest still may exist and, as a result, the

terms of the business combination may not be as advantageous to our public stockholders as they would be absent any conflicts

Since our sponsor, executive officers

and directors will lose their entire investment in us if our initial business combination is not completed (other than with respect

to public shares they may acquire during or after our Initial Public Offering), a conflict of interest may arise in determining

whether a particular business combination target is appropriate for our initial business combination.

In September 2020 our sponsor paid

$25,000 in exchange for 14,375,000 founder shares.

Prior to the initial investment in the company of $25,000 by the sponsor, the

company had no assets, tangible or intangible.

The purchase price of the founder shares was determined by dividing the amount of

cash contributed to the company by the number of founder shares issued.

The number of founder shares

outstanding at the time of our Initial Public Offering was determined based on the expectation that the total size of this

offering would be a maximum of 57,500,000 units if the underwriters’

over-allotment option is exercised in full, and

therefore that such founder shares would represent 20% of the outstanding shares after this offering.

In December 2020,

1,875,000 of the founder shares were forfeited because the underwriters’

did not exercise their over-allotment option.

The founder shares will be worthless if we do not complete an initial business combination.

In addition, our sponsor has

committed to purchase an aggregate of 8,000,000 private placement warrants, (or up to 9,000,000 private placement warrants if

the overallotment option is exercised in full) each exercisable to purchase one share of Class A common stock at $11.50

per share, at a price of $1.50 per warrant, or $12,000,000 (or up to $13,500,000 if the overallotment option is exercised in

full), that will also be worthless if we do not complete our initial business combination.

In addition, we have engaged

Moelis & Company LLC, together with the representative of the underwriter, to act as our advisors in connection with the

marketing of our business combination as described under “Underwriting —

Business Combination Marketing

Agreement”

as set forth in our Prospectus dated October 27, 2020 filed with the SEC in connection with our IPO and we

may engage Moelis as our lead financial advisor on our business combination and other transactions, in each case, with fees

for such engagements to be conditioned upon the completion of the business combination.

These personal and financial

interests of our executive officers, directors and members of our Sponsor may influence their motivation in identifying and

selecting a target business combination, completing an initial business combination and influencing the operation of the

business following the initial business combination.

This risk may become more acute as the 24-month anniversary of our

Initial Public Offering, which is the deadline for our completion of an initial business combination.

None of Moelis or, any of its affiliates

has an obligation to provide us with potential investment opportunities or to devote any specified amount of time or support to

our company’s business.

Although we expect we may benefit from

Moelis and its affiliates’

networks of relationships and processes for sourcing and evaluating potential acquisition targets,

neither it nor any of its affiliates has any legal or contractual obligation to seek on our behalf or present to us investment

opportunities that might be suitable for our business, and they may allocate any such opportunities at their discretion to us or

other parties.

We have no investment management, advisory, consulting or other agreement in place with Moelis or any of its affiliates

that obligates them to undertake efforts on our behalf or that govern the manner in which they will allocate investment opportunities.

Moreover, even if Moelis or one of its affiliates refers an opportunity to us, there can be no assurance that such an opportunity

will result in an acquisition agreement or a business combination.

We engaged Moelis, a member and

affiliate of our sponsor, as our lead financial advisor on our business combination and related transactions.

connection with such engagements are conditioned upon the completion of such transactions.

Prior to consummation of our

Initial Public Offering, we engaged Moelis & Company LLC, together with the representative of the underwriters, to act as

our advisors in connection with the marketing of our business combination and we will agree to pay the representative of the

underwriters and Moelis & Company LLC the Marketing Fee upon consummation of our business combination.

interests in the completion of such transactions may influence the advice such affiliate provides.

We engaged Moelis & Company LLC, a

member and affiliate of our sponsor as a financial advisor in connection with the Business Combination.

Certain investment banking

professionals of Moelis working on such engagement are members of our sponsor.

In connection with such engagement, we have agreed

to pay such affiliate a financial advisory fee and placement agency fee as described under “Management’s Discussion

and Analysis of Financial Condition and Results of Operation—

Advisory and Placement Agent Services Engagement Letters.”.

Pursuant to any such engagement, the affiliate will earn its fees upon closing of the Business Combination.

The payment of these

fees is conditioned upon the completion of the Business Combination.

If we do not complete the Business Combination, we may seek

to engage Moelis & Company LLC or its affiliates, in connection with other initial business combinations with fees that are

contingent upon closing of such initial business combination.

We engaged Moelis & Company LLC, together

with the representative of the underwriters, to act as our advisors in connection with the marketing of our business combination

and pay to Moelis & Company LLC and the representative of the underwriter a fee for such services upon consummation of our

initial business combination as described under “Management’s Discussion and Analysis of Financial Condition and Results

of Operation—

Business Combination Marketing Agreement.”

Therefore, affiliates of our sponsor will

have additional financial interests in the completion of the initial business combination.

These financial interests may influence

the advice any such affiliate provides us as our financial advisor, which advice would contribute to our decision on whether to

pursue a business combination with any particular target.

We may compete with clients of Moelis

or other affiliates of our sponsor, including the AC SPACS, for acquisition opportunities for our company, which could negatively

impact our ability to locate a suitable business combination.

Our business strategy may overlap with

some of the strategies of clients of Moelis and certain of its other affiliates.

Moelis is an independent global investment bank.

Acquisition opportunities that may be of interest to us may come to Moelis, its clients or other affiliates of our sponsor, including

the AC SPACs, instead of us or may be pursued by those parties.

Our affiliates are not restricted from competing with our business

and none of our affiliates are required to refer any such opportunities to us.

Our sponsor and its affiliates face conflicts of

interest relating to performing services on our behalf and allocating investment opportunities to us, and such conflicts may not

be resolved in our favor, meaning we could find less suitable acquisition opportunities which could limit our ability to find a

business combination that we find attractive.

Conflicts may arise from Moelis’

affiliation with us, its provision of services both to us and to third-party clients, including the AC SPACs, as well as from actions

undertaken by Moelis or its affiliates for its own account.

In performing services for other clients and also when acting for its

own account, Moelis may take commercial steps which may have an adverse effect on us.

Moelis is often engaged as a financial advisor,

or placement agent, to corporations and other entities and their directors and managers in connection with the sale of those entities,

their assets or their subsidiaries.

Clients generally require Moelis to act exclusively on their behalf and/or for other reasons,

we may be precluded from attempting to acquire securities of the business being sold or otherwise participate as a buyer in the

Alternatively, Moelis, or another affiliate of our sponsor, may be a financial advisor to a target business that we

pursue a business combination with and Moelis, or another affiliate of our sponsor, may receive fees from the target business in

connection with a business combination.

Moelis also represents potential buyer’s businesses.

Moelis may be incentivized to

direct an opportunity to one of these buyers, thereby eliminating or reducing the investment opportunity available to us.

Moelis is engaged by AC I and AC II in connection with the marketing of a business combination by AC I and AC II, respectively.

Moelis intends to be engaged by AC III, AC IV and AC V in connection with the marketing of a business combination of each such

Moelis may be engaged from time to time by the AC SPACs to provide financial advisory and placement agency services in

connection with such business combination.

Moelis is a member of each of the sponsors of the AC SPACs and has, or will have, an

economic interest in such AC SPACS.

Any of Moelis’

other activities may, individually or in the aggregate, have an

adverse effect on us, and the interests of Moelis or its clients or counterparties may at times be adverse to ours.

We may issue notes or other debt securities,

or otherwise incur substantial debt, to complete a business combination, which may adversely affect our leverage and financial

condition and thus negatively impact the value of our stockholders’

investment in us.

Although we have no commitments as of the

date of this Report to issue any notes or other debt securities, or to otherwise incur outstanding debt following this offering,

we may choose to incur substantial debt to complete our initial business combination.

We and our officers have agreed that we will

not incur any indebtedness unless we have obtained from the lender a waiver of any right, title, interest or claim of any kind

in or to the monies held in the trust account.

As such, no issuance of debt will affect the per share amount available for redemption

from the trust account.

Nevertheless, the incurrence of debt could have a variety of negative effects, including:

default and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay

our debt obligations;

acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach

certain covenants that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that

our immediate payment of all principal and accrued interest, if any, if the debt is payable on demand;

our inability to obtain necessary additional financing if the debt contains covenants restricting our ability to obtain such financing

while the debt is outstanding;

our inability to pay dividends on our Class A common stock;

using a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available

for dividends on our Class A common stock if declared, expenses, capital expenditures, acquisitions and other general corporate

limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate;

increased vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government

limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements,

execution of our strategy and other purposes and other disadvantages compared to our competitors who have less debt.

We may only be able to complete one

business combination with the proceeds of our Initial Public Offering and the sale of the private placement warrants, which will

cause us to be solely dependent on a single business which may have a limited number of products or services.

This lack of diversification

may negatively impact our operations and profitability.

The proceeds of the Initial Public Offering

and the private placement of warrants provided us with $482,500,000 (or $554,875,000 if the underwriters’

over-allotment

option is exercised in full) that we may use to complete our initial business combination (after taking into account the $17,500,000

Marketing Fee being held in the trust account).

We may effectuate our initial business

combination with a single target business or multiple target businesses simultaneously or within a short period of time.

we may not be able to effectuate our initial business combination with more than one target business because of various factors,

including the existence of complex accounting issues and the requirement that we prepare and file pro forma financial statements

with the SEC that present operating results and the financial condition of several target businesses as if they had been operated

on a combined basis.

By completing our initial business combination with only a single entity, our lack of diversification may

subject us to numerous economic, competitive and regulatory developments.

Further, we would not be able to diversify our operations

or benefit from the possible spreading of risks or offsetting of losses, unlike other entities which may have the resources to

complete several business combinations in different industries or different areas of a single industry.

Accordingly, the prospects

for our success may be:

dependent upon the performance of a single business, property or asset, or

upon the development or market acceptance of a single or limited number of products, processes or services.

This lack of diversification may subject

us to numerous economic, competitive and regulatory risks, any or all of which may have a substantial adverse impact upon the particular

industry in which we may operate subsequent to our initial business combination.

We may attempt to simultaneously complete

business combinations with multiple prospective targets, which may hinder our ability to complete our initial business combination

and give rise to increased costs and risks that could negatively impact our operations and profitability.

If we determine to simultaneously acquire

several businesses that are owned by different sellers, we will need for each of such sellers to agree that our purchase of its

business is contingent on the simultaneous closings of the other business combinations, which may make it more difficult for us,

and delay our ability, to complete our initial business combination.

With multiple business combinations, we could also face additional

risks, including additional burdens and costs with respect to possible multiple negotiations and due diligence investigations (if

there are multiple sellers) and the additional risks associated with the subsequent assimilation of the operations and services

or products of the acquired companies in a single operating business.

If we are unable to adequately address these risks, it could

negatively impact our profitability and results of operations.

We may attempt to complete our initial

business combination with a private company about which little information is available, which may result in a business combination

with a company that is not as profitable as we suspected, if at all.

In pursuing our business combination strategy,

we may seek to effectuate our initial business combination with a privately held company.

Very little public information generally

exists about private companies, and we could be required to make our decision on whether to pursue a potential initial business

combination on the basis of limited information, which may result in a business combination with a company that is not as profitable

as we suspected, if at all.

Our management may not be able to maintain

control of a target business after our initial business combination.

We cannot provide assurance that, upon loss of control of

a target business, new management will possess the skills, qualifications or abilities necessary to profitably operate such business.

We may structure our initial business combination

so that the post-transaction company in which our public stockholders own shares will own less than 100% of the equity interests

or assets of a target business, but we will only complete such 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 us not to be required to register as an investment company under the Investment Company Act.

We will not consider any transaction

that does not meet such criteria.

Even if the post-transaction company owns 50% or more of the voting securities of the target,

our stockholders prior to the business combination may collectively own a minority interest in the post business combination company,

depending on valuations ascribed to the target and us in the business combination.

For example, we could pursue a transaction in

which we issue a substantial number of new shares of Class A common stock in exchange for all of the outstanding capital stock

In this case, we would acquire a 100% interest in the target.

However, as a result of the issuance of a substantial

number of new shares of Class A common stock, our stockholders immediately prior to such transaction could own less than a

majority of our outstanding Class A common stock subsequent to such transaction.

In addition, other minority stockholders

may subsequently combine their holdings resulting in a single person or group obtaining a larger share of the company’s shares

than we initially acquired.

Accordingly, this may make it more likely that our management will not be able to maintain control

of the target business.

We do not have a specified maximum redemption

The absence of such a redemption threshold may make it possible for us to complete our initial business combination

with which a substantial majority of our stockholders or warrant holders do not agree.

Our amended and restated certificate of

incorporation does not provide a specified maximum redemption threshold, except that in no event will we redeem our public shares

in an amount that would cause our net tangible assets to be less than $5,000,001.

In addition, our proposed initial business combination

may impose a minimum cash requirement for:

(i) cash consideration to be paid to the target or its owners, (ii) cash for

working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions.

we may be able to complete our initial business combination even though a substantial majority of our public stockholders do not

agree with the transaction and have redeemed their shares or, if we seek stockholder approval of our initial business combination

and do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, have entered

into privately negotiated agreements to sell their shares to our sponsor, officers, directors or any of their affiliates.

event the aggregate cash consideration we would be required to pay for all shares of Class A common stock that are validly

submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination

exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares in connection

with such initial business combination, all shares of Class A common stock submitted for redemption will be returned to the

holders thereof, and we instead may search for an alternate business combination.

In order to effectuate an initial business

combination, special purpose acquisition companies have, in the recent past, amended various provisions of their charters and other

governing instruments, including their warrant agreements.

We cannot assure you that we will not seek to amend our amended and

restated certificate of incorporation or governing instruments in a manner that will make it easier for us to complete our initial

business combination that our stockholders may not support.

In order to effectuate a business combination,

special purpose acquisition companies have, in the recent past, amended various provisions of their charters and governing instruments,

including their warrant agreements.

For example, special purpose acquisition companies have amended the definition of business

combination, increased redemption thresholds and extended the time to consummate an initial business combination and, with respect

to their warrants, amended their warrant agreements to require the warrants to be exchanged for cash and/or other securities.

our amended and restated certificate of incorporation will require the approval of holders of 65% of our common stock, and amending

our warrant agreement will require a vote of holders of at least a majority of the public warrants and, solely with respect to

any amendment to the terms of the private placement warrants or any provision of the warrant agreement with respect to the private

placement warrants, 50% of the number of then outstanding private placement warrants.

In addition, our amended and restated certificate

of incorporation requires us to provide our public stockholders with the opportunity to redeem their public shares for cash if

we propose an amendment to our amended and restated certificate of incorporation to modify the substance or timing of our obligation

to redeem 100% of our public shares if we do not complete an initial business combination within 24 months of the closing of our

Initial Public Offering or with respect to any other material provisions relating to stockholders’

rights or pre-initial

business combination activity.

To the extent any of such amendments would be deemed to fundamentally change the nature of the securities

offered through this registration statement, we would register, or seek an exemption from registration for, the affected securities.

We cannot assure you that we will not seek to amend our charter or governing instruments or extend the time to consummate an initial

business combination in order to effectuate our initial business combination.

The provisions of our amended and restated

certificate of incorporation that relate to our pre-business combination activity (and corresponding provisions of the agreement

governing the release of funds from our trust account) may be amended with the approval of holders of 65% of our common stock,

which is a lower amendment threshold than that of some other special purpose acquisition companies.

It may be easier for us, therefore,

to amend our amended and restated certificate of incorporation to facilitate the completion of an initial business combination

that some of our stockholders may not support.

Our amended and restated certificate of

incorporation provides that any of its provisions related to pre-business combination activity (including the requirement to deposit

proceeds of our Initial Public Offering and the private placement of warrants into the trust account and not release such amounts

except in specified circumstances, and to provide redemption rights to public stockholders as described herein) may be amended

if approved by holders of 65% of our common stock entitled to vote thereon and corresponding provisions of the trust agreement

governing the release of funds from our trust account may be amended if approved by holders of 65% of our common stock entitled

to vote thereon.

If we amend such provisions of our amended and restated certificate of incorporation, we will provide our public

stockholders with the opportunity to redeem their public shares in connection with a stockholder meeting.

In all other instances,

our amended and restated certificate of incorporation may be amended by holders of a majority of our outstanding common stock entitled

to vote thereon, subject to applicable provisions of the DGCL or applicable stock exchange rules.

Our initial stockholders, who

will collectively beneficially own 20% of our common stock upon the closing of our Initial Public Offering (assuming they do not

purchase any units in our Initial Public Offering), may participate in any vote to amend our amended and restated certificate of

incorporation and/or trust agreement and will have the discretion to vote in any manner they choose.

As a result, we may be able

to amend the provisions of our amended and restated certificate of incorporation which govern our pre-business combination behavior

more easily than some other special purpose acquisition companies, and this may increase our ability to complete a business combination

with which you do not agree.

Our stockholders may pursue remedies against us for any breach of our amended and restated certificate

of incorporation.

Our sponsor, executive officers and

directors have agreed, pursuant to written agreements with us, that they will not propose any amendment to our amended and

restated certificate of incorporation to modify the substance or timing of our obligation to redeem 100% of our public shares

if we do not complete our initial business combination within 24 months from the closing of our Initial Public Offering or

with respect to any other material provisions relating to stockholders’

rights or pre-initial business combination

activity, unless we provide our public stockholders with the opportunity to redeem their Class A common stock 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 earned on the funds held in the trust account (which interest shall be net of taxes

payable), divided by the number of then outstanding public shares.

Our stockholders are not parties to, or third-party

beneficiaries of, these agreements and, as a result, will not have the ability to pursue remedies against our sponsor,

executive officers, directors or director nominees for any breach of these agreements.

As a result, in the event of a breach,

our stockholders would need to pursue a stockholder derivative action, subject to applicable law.

Certain agreements related to our Initial

Public Offering may be amended without stockholder approval.

Each of the agreements related to our Initial

Public Offering to which we are a party, other than the warrant agreement and the investment management trust agreement, may be

amended without stockholder approval.

Such agreements are:

the underwriting agreement;

the letter agreement among us and our initial

stockholders, sponsor, officers and directors;

the registration rights agreement among us and our initial stockholders;

placement warrants purchase agreement between us and our sponsor;

and the administrative services agreement among us, our sponsor

and an affiliate of our sponsor.

These agreements contain various provisions that our public stockholders might deem to be material.

For example, our letter agreement and the underwriting agreement contain certain lock-up provisions with respect to the founder

shares, private placement warrants and other securities held by our initial stockholders, sponsor, officers and directors.

to such agreements would require the consent of the applicable parties thereto and would need to be approved by our board of directors,

which may do so for a variety of reasons, including to facilitate our initial business combination.

While we do not expect our

board of directors to approve any amendment to any of these agreements prior to our initial business combination, it may be possible

that our board of directors, in exercising its business judgment and subject to its fiduciary duties, chooses to approve one or

more amendments to any such agreement.

Any amendment entered into in connection with the consummation of our initial business combination

will be disclosed in our proxy materials or tender offer documents, as applicable, related to such initial business combination,

and any other material amendment to any of our material agreements will be disclosed in a filing with the SEC.

Any such amendments

would not require approval from our stockholders, may result in the completion of our initial business combination that may not

otherwise have been possible, and may have an adverse effect on the value of an investment in our securities.

For example, amendments

to the lock-up provision discussed above may result in our initial stockholders selling their securities earlier than they would

otherwise be permitted, which may have an adverse effect on the price of our securities.

We may be unable to obtain additional

financing to complete our initial business combination or to fund the operations and growth of a target business, which could compel

us to restructure or abandon a particular business combination.

We have not selected any specific business

combination target but intend to target businesses with enterprise values that are greater than we could acquire with the net proceeds

of our Initial Public Offering and the sale of the private placement warrants.

As a result, if the cash portion of the purchase

price exceeds the amount available from the trust account, net of amounts needed to satisfy any redemption by public stockholders,

we may be required to seek additional financing to complete such proposed initial business combination.

We cannot assure you that

such financing will be available on acceptable terms, if at all.

To the extent that additional financing proves to be unavailable

when needed to complete our initial business combination, we would be compelled to either restructure the transaction or abandon

that particular business combination and seek an alternative target business candidate.

Further, we may be required to obtain additional

financing in connection with the closing of our initial business combination for general corporate purposes, including for maintenance

or expansion of operations of the post-transaction businesses, the payment of principal or interest due on indebtedness incurred

in completing our initial business combination, or to fund the purchase of other companies.

If we are unable to complete our initial

business combination, our public stockholders may only receive their pro rata portion of the funds in the trust account that are

available for distribution to public stockholders, and our warrants will expire worthless.

In addition, even if we do not need

additional financing to complete our initial business combination, we may require such financing to fund the operations or growth

of the target business.

The failure to secure additional financing could have a material adverse effect on the continued development

or growth of the target business.

None of our officers, directors or stockholders is required to provide any financing to us in

connection with or after our initial business combination.

Our warrants may have an adverse effect

on the market price of our shares of Class A common stock and make it more difficult to effectuate our initial business combination.

We issued warrants to purchase

16,666,667 shares of our Class A common stock as part of the units offered in our Initial Public Offering and,

simultaneously with the closing of our Initial Public Offering, we issued in a private placement an aggregate of

8,000,000 private placement warrants each exercisable to purchase one share of Class A common stock at $11.50 per share, at a price of $1.50 per

warrant, or $12,000,000.

In addition, if our sponsor

or an affiliate of our sponsor or certain of our officers and directors makes any working capital loans, such lender may

convert those loans into up to an additional 1,000,000 private placement warrants, at the price of $1.50 per warrant.

extent we issue common stock to effectuate a business transaction, the potential for the issuance of a substantial number of

additional shares of Class A common stock upon exercise of these warrants could make us a less attractive acquisition

vehicle to a target business.

Such warrants, when exercised, will increase the number of issued and outstanding shares of

Class A common stock and reduce the value of the Class A common stock issued to complete the business transaction.

Therefore, our warrants may make it more difficult to effectuate a business transaction or increase the cost of acquiring the

target business.

Because each unit contains one-third

of one warrant and only a whole warrant may be exercised, the units may be worth less than units of other special purpose acquisition

Each unit contains one-third of one warrant.

Pursuant to the warrant agreement, no fractional warrants will be issued upon separation of the units, and only whole units will

If, upon exercise of the warrants, a holder would be entitled to receive a fractional interest in a share, we will, upon

exercise, round down to the nearest whole number the number of shares of Class A common stock to be issued to the warrant

This is different from other offerings similar to ours whose units include one common share and one warrant to purchase

one whole share.

We have established the components of the units in this way in order to reduce the dilutive effect of the warrants

upon completion of a business combination since the warrants will be exercisable in the aggregate for one-third of the number of

shares compared to units that each contain a whole warrant to purchase one share, thus making us, we believe, a more attractive

merger partner for target businesses.

Nevertheless, this unit structure may cause our units to be worth less than if it included

a warrant to purchase one whole share.

Unlike some other similarly structured

special purpose acquisition companies, our initial stockholders will receive additional shares of Class A common stock if

we issue certain shares to consummate an initial business combination.

The founder shares will automatically convert

into shares of Class A common stock upon the consummation of our initial business combination on a one-for-one basis, subject

to adjustment for stock splits, stock dividends, reorganizations, recapitalizations and the like, and subject to further adjustment

as provided herein.

In the case that additional shares of Class A common stock or equity-linked securities are issued or deemed

issued in connection with our initial business combination, the number of shares of Class A common stock issuable upon conversion

of all founder shares will equal, in the aggregate, on an as-converted basis, 20% of the total number of shares of Class A

common stock outstanding after such conversion, including the total number of shares of Class A common stock issued, or deemed

issued or issuable upon conversion or exercise of any equity-linked securities or rights issued or deemed issued, by the company

in connection with or in relation to the consummation of the initial business combination, excluding any shares of Class A

common stock or equity-linked securities or rights exercisable for or convertible into shares of Class A common stock issued,

or to be issued, to any seller in the initial business combination and any private placement warrants issued to our sponsor, officers

or directors upon conversion of working capital loans, provided that such conversion of founder shares will never occur on a less

than one-for-one basis.

This is different than some other similarly structured special purpose acquisition companies in which the

initial stockholders will only be issued an aggregate of 20% of the total number of shares to be outstanding prior to our initial

business combination.

Because we must furnish our stockholders

with target business financial statements, we may lose the ability to complete an otherwise advantageous initial business combination

with some prospective target businesses.

The federal proxy rules require that the

proxy statement with respect to the vote on an initial business combination include historical and pro forma financial statement

We will include the same financial statement disclosure in connection with our tender offer documents, whether or not

they are required under the tender offer rules.

These financial statements may be required to be prepared in accordance with, or

be reconciled to, accounting principles generally accepted in the United States of America (“GAAP”), or international

financial reporting standards as issued by the International Accounting Standards Board (“IFRS”), depending on the

circumstances and the historical financial statements may be required to be audited in accordance with the standards of the Public

Company Accounting Oversight Board (United States) (“PCAOB”).

These financial statement requirements may limit

the pool of potential target businesses we may acquire because some targets may be unable to provide such financial statements

in time for us to disclose such statements in accordance with federal proxy rules and complete our initial business combination

within the prescribed time frame.

Compliance obligations under the Sarbanes-Oxley

Act may make it more difficult for us to effectuate our initial business combination, require substantial financial and management

resources, and increase the time and costs of completing an initial business combination.

Section 404 of the Sarbanes-Oxley

Act requires that we evaluate and report on our system of internal controls beginning with our Annual Report on Form 10-K

for the year ending December 31, 2021.

Only in the event we are deemed to be a large accelerated filer or an accelerated filer,

and no longer qualify as an emerging growth company, will we be required to comply with the independent registered public accounting

firm attestation requirement on our internal control over financial reporting.

Further, for as long as we remain an emerging growth

company, we will not be required to comply with the independent registered public accounting firm attestation requirement on our

internal control over financial reporting.

The fact that we are a blank check company makes compliance with the requirements of

the Sarbanes-Oxley Act particularly burdensome on us as compared to other public companies because a target business with which

we seek to complete our initial business combination may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding

adequacy of its internal controls.

The development of the internal control of any such entity to achieve compliance with the Sarbanes-Oxley

Act may increase the time and costs necessary to complete any such business combination.

If we effect our initial business combination

with a company located outside of the United States, we would be subject to a variety of additional risks that may adversely

If we pursue a target company with operations

or opportunities outside of the United States for our initial business combination, we may face additional burdens in connection

with investigating, agreeing to and completing such initial business combination, and if we effect such initial business combination,

we would be subject to a variety of additional risks that may negatively impact our operations.

If we pursue a target a company with operations

or opportunities outside of the United States for our initial business combination, we would be subject to risks associated

with cross-border business combinations, including in connection with investigating, agreeing to and completing our initial business

combination, conducting due diligence in a foreign jurisdiction, having such transaction approved by any local governments, regulators

or agencies and changes in the purchase price based on fluctuations in foreign exchange rates.

If we effect our initial business combination

with such a company, we would be subject to any special considerations or risks associated with companies operating in an international

setting, including any of the following:

and difficulties inherent in managing cross-border business operations;

and regulations regarding currency redemption;

corporate withholding taxes on individuals;

governing the manner in which future business combinations may be effected;

listing and/or delisting requirements;

and trade barriers;

related to customs and import/export matters;

or regional economic policies and market conditions;

changes in regulatory requirements;

in managing and staffing international operations;

payment cycles;

issues, such as tax law changes and variations in tax laws as compared to the United States;

fluctuations and exchange controls;

of inflation;

in collecting accounts receivable;

and language differences;

underdeveloped

or unpredictable legal or regulatory systems;

of intellectual property;

unrest, crime, strikes, riots and civil disturbances;

changes and political upheaval;

attacks and wars;

deterioration

of political relations with the United States.

We may not be able to adequately address

these additional risks.

If we were unable to do so, we may be unable to complete such initial business combination, or, if we complete

such initial business combination, our operations might suffer, either of which may adversely impact our business, financial condition

and results of operations.

As the number of special purpose

acquisition companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for

attractive targets.

This could increase the cost of our initial business combination and could even result in our inability to

find a target or to consummate an initial business combination.

In recent years, the

number of special purpose acquisition companies that have been formed has increased substantially.

Many potential targets for special

purpose acquisition companies have already entered into an initial business combination, and there are still many special purpose

acquisition companies seeking targets for their initial business combination, as well as many such companies currently in registration.

As a result, at times, fewer attractive targets may be available, and it may require more time, more effort and more resources

to identify a suitable target and to consummate an initial business combination.

In addition, because

there are more special purpose acquisition companies seeking to enter into an initial business combination with available targets,

the competition for available targets with attractive fundamentals or business models may increase, which could cause targets companies

to demand improved financial terms.

Attractive deals could also become scarcer for other reasons, such as economic or industry

sector downturns, geopolitical tensions, or increases in the cost of additional capital needed to close business combinations or

operate targets post-business combination.

This could increase the cost of, delay or otherwise complicate or frustrate our ability

to find and consummate an initial business combination, and may result in our inability to consummate an initial business combination

on terms favorable to our investors altogether.

We may not have sufficient funds to

satisfy indemnification claims of our directors and executive officers.

We have agreed to indemnify our officers

and directors to the fullest extent permitted by law.

However, our officers and directors have agreed to waive any right, title,

interest or claim of any kind in or to any monies in the trust account and to not seek recourse against the trust account for any

reason whatsoever.

Accordingly, any indemnification provided will be able to be satisfied by us only if (i) we have sufficient

funds outside of the trust account or (ii) we consummate an initial business combination.

Our obligation to indemnify our

officers and directors may discourage stockholders from bringing a lawsuit against our officers or directors for breach of their

fiduciary duty.

These provisions also may have the effect of reducing the likelihood of derivative litigation against our officers

and directors, even though such an action, if successful, might otherwise benefit us and our stockholders.

Furthermore, a stockholder’s

investment may be adversely affected to the extent we pay the costs of settlement and damage awards against our officers and directors

pursuant to these indemnification provisions.

We may not hold an annual meeting of

stockholders until after the consummation of our initial business combination, which could delay the opportunity for our stockholders

to elect directors.

In accordance with the NYSE corporate governance

requirements, we are not required to hold an annual meeting until no later than one year after our first full fiscal year end following

our listing on the NYSE.

Under Section 211(b) of the DGCL, we are, however, required to hold an annual meeting of stockholders

for the purposes of electing directors in accordance with our bylaws unless such election is made by written consent in lieu of

such a meeting.

We may not hold an annual meeting of stockholders to elect new directors prior to the consummation of our initial

business combination, and thus we may not be in compliance with Section 211(b) of the DGCL, which requires an annual meeting.

Therefore, if our stockholders want us to hold an annual meeting prior to the consummation of our initial business combination,

they may attempt to force us to hold one by submitting an application to the Delaware Court of Chancery in accordance with Section 211(c)

Risks Related to Our Trust Account

The securities in which we invest the

funds held in the trust account could bear a negative rate of interest, which could reduce the value of the assets held in trust

such that the per-share redemption amount received by public shareholders may be less than $10.00 per share.

The proceeds held in the trust account

will be invested only in U.S.

government treasury obligations with a maturity of 185 days or less or in money market funds

meeting certain conditions under Rule 2a-7 under the Investment Company Act, which invest only in direct U.S.

government treasury

While short-term U.S.

government treasury obligations currently yield a positive rate of interest, they have briefly

yielded negative interest rates in recent years.

Central banks in Europe and Japan pursued interest rates below zero in recent

years, and the Open Market Committee of the Federal Reserve has not ruled out the possibility that it may in the future adopt similar

policies in the United States.

In the event that we are unable to complete our initial business combination or make certain

amendments to our amended and restated certificate of incorporation, our public shareholders are entitled to receive their pro-rata

share of the proceeds held in the trust account, plus any interest income, net of taxes paid or payable (less, in the case we are

unable to complete our initial business combination, $100,000 of interest).

Negative interest rates could reduce the value of the

assets held in trust such that the per-share redemption amount received by public shareholders may be less than $10.00 per share.

You will not have any rights or interests

in funds from the trust account, except under certain limited circumstances.

Therefore, to liquidate your investment, you may be

forced to sell your public shares or warrants, potentially at a loss.

Our public stockholders will be

entitled to receive funds from the trust account only upon the earlier to occur of:

(i) our completion of an initial

business combination, and then only in connection with those shares of Class A common stock that such stockholder

properly elected to redeem, subject to the limitations described herein, (ii) the redemption of any public shares

properly tendered in connection with a stockholder vote to amend our amended and restated certificate of incorporation to

modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial

business combination within 24 months from the closing of our Initial Public Offering or with respect to any other material

provisions relating to stockholders’

rights or pre-initial business combination activity, and (iii) the redemption

of our public shares if we are unable to complete an initial business combination within 24 months from the closing of our

Initial Public Offering, subject to applicable law and as further described herein.

In addition, if our plan to redeem our

public shares if we are unable to complete an initial business combination within 24 months from the closing or our Initial

Public Offering is not completed for any reason, compliance with Delaware law may require that we submit a plan of

dissolution to our then-existing stockholders for approval prior to the distribution of the proceeds held in our trust

In that case, public stockholders may be forced to wait beyond 24 months from the closing of our Initial Business

Combination before they receive funds from our trust account.

In no other circumstances will a public stockholder have any

right or interest of any kind in the trust account.

Holders of warrants will not have any right to the proceeds held in the

trust account with respect to the warrants.

Accordingly, to liquidate your investment, you may be forced to sell your public

shares or warrants, potentially at a loss.

If third parties bring claims against

us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be

less than $10.00 per share.

Our placing of funds in the trust account

may not protect those funds from third party claims against us.

Although we will seek to have all vendors, service providers (other

than our independent auditors), prospective target businesses and other entities with which we do business execute agreements with

us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit of our

public stockholders, such parties may not execute such agreements, or even if they execute such agreements they may not be prevented

from bringing claims against the trust account, including, but not limited to, fraudulent inducement, breach of fiduciary responsibility

or other similar claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain advantage

with respect to a claim against our assets, including the funds held in the trust account.

If any third party refuses to execute

an agreement waiving such claims to the monies held in the trust account, our management will consider whether competitive alternatives

are reasonably available to us and will only enter into an agreement with such third party if management believes that such third

party’s engagement would be in the best interests of the company under the circumstances.

The underwriters of our Initial

Public Offering and our registered independent public accounting firm have not executed agreements with us waiving such claims

to the monies held in the trust account.

Examples of possible instances where

we may engage a third party that refuses to execute a waiver include the engagement of a third party consultant whose

particular expertise or skills are believed by management to be significantly superior to those of other consultants that

would agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a

In addition, there is no guarantee that such entities will agree to waive any claims they may have in the future as a

result of, or arising out of, any negotiations, contracts or agreements with us and will not seek recourse against the trust

account for any reason.

Upon redemption of our public shares, if we are unable to complete our initial business combination

within the prescribed timeframe, or upon the exercise of a redemption right in connection with our initial business

combination, we will be required to provide for payment of claims of creditors that were not waived that may be brought

against us within the 10 years following redemption.

Accordingly, the per-share redemption amount received by public

stockholders could be less than the $10.00 per public share initially held in the trust account, due to claims of such

Pursuant to the letter agreement the form of which is filed as an exhibit to the Form 8-K filed on November 2,

2020 in connection with our Initial Public Offering, our sponsor has agreed that it will be liable to us if and to the extent any

claims by a third party for services rendered or products sold to us, or a prospective target business with which we have

entered into a written letter of intent, confidentiality or other similar agreement or business combination agreement, reduce

the amount of funds in the trust account to below the lesser of (i) $10.00 per public share and (ii) the actual amount

per public share held in the trust account as of the date of the liquidation of the trust account, if less than $10.00 per

public share due to reductions in the value of the trust assets, less taxes payable, provided that such liability will not

apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies

held in the trust account (whether or not such waiver is enforceable) nor will it apply to any claims under our indemnity of

the underwriters of our Initial Public Offering against certain liabilities, including liabilities under the Securities Act.

However, we have not asked our sponsor to reserve for such indemnification obligations, nor have we independently verified

whether our sponsor has sufficient funds to satisfy its indemnity obligations and we believe that our sponsor’s only

assets are securities of our company.

Therefore, we cannot assure you that our sponsor would be able to satisfy those

As a result, if any such claims were successfully made against the trust account, the funds available for our

initial business combination and redemptions could be reduced to less than $10.00 per public share.

In such event, we may not

be able to complete our initial business combination, and you would receive such lesser amount per share in connection with

any redemption of your public shares.

None of our officers or directors will indemnify us for claims by third parties

including, without limitation, claims by vendors and prospective target businesses.

Our directors may decide not to enforce

the indemnification obligations of our sponsor, resulting in a reduction in the amount of funds in the trust account available

for distribution to our public stockholders.

In the event that the proceeds in the trust

account are reduced below the lesser of (i) $10.00 per share and (ii) the actual amount per public share held in the trust

account as of the date of the liquidation of the trust account if less than $10.00 per public share due to reductions in the value

of the trust assets, in each case less taxes payable, and our sponsor asserts that it is unable to satisfy its obligations or that

it has no indemnification obligations related to a particular claim, our independent directors would determine whether to take

legal action against our sponsor to enforce its indemnification obligations.

While we currently expect that our independent directors

would take legal action on our behalf against our sponsor to enforce its indemnification obligations to us, it is possible that

our independent directors in exercising their business judgment and subject to their fiduciary duties may choose not to do so in

any particular instance.

If our independent directors choose not to enforce these indemnification obligations, the amount of funds

in the trust account available for distribution to our public stockholders may be reduced below $10.00 per share.

If, after we distribute the proceeds

in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against

us that is not dismissed, a bankruptcy court may seek to recover such proceeds, and the members of our board of directors may be

viewed as having breached their fiduciary duties to our creditors, thereby exposing the members of our board of directors and us

to claims of punitive damages.

If, after we distribute the proceeds in

the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against

us that is not dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor and/or bankruptcy

laws as either a “preferential transfer”

or a “fraudulent conveyance.”

As a result, a bankruptcy court

could seek to recover some or all amounts received by our stockholders.

In addition, our board of directors may be viewed as having

breached its fiduciary duty to our creditors and/or having acted in bad faith, by paying public stockholders from the trust account

prior to addressing the claims of creditors, thereby exposing itself and us to claims of punitive damages.

If, before distributing the proceeds

in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against

us that is not dismissed, the claims of creditors in such proceeding may have priority over the claims of our stockholders and

the per-share amount that would otherwise be received by our stockholders in connection with our liquidation may be reduced.

If, before distributing the proceeds in

the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against

us that is not dismissed, the proceeds held in the trust account could be subject to applicable bankruptcy law, and may be included

in our bankruptcy estate and subject to the claims of third parties with priority over the claims of our stockholders.

To the extent

any bankruptcy claims deplete the trust account, the per-share amount that would otherwise be received by our stockholders in connection

with our liquidation may be reduced.

If the net proceeds of our Initial Public

Offering not being held in the trust account are insufficient to allow us to operate through closing of the Business Combination

we may need to raise additional capital from our Sponsor and if the Business Combination is not consummated, , it could limit the

amount available to fund our search for a target business or businesses and complete our initial business combination, and we will

depend on loans from our sponsor or management team to fund our search and to complete our initial business combination.

We have approximately $500,000

available to us outside the trust account to fund our working capital requirements.

We believe the funds available to us

outside of the trust account will be sufficient to allow us to operate through the closing of our Business Combination.

we do not consummate the Business Combination, we might not have sufficient funds to continue searching for, or conduct due

diligence with respect to, a target business.

Of the funds available to us, we have used a portion of the funds available to

us to pay fees to consultants to assist us with our search for a target business.

We could also use a portion of the funds as

a down payment or to fund a “no-shop”

provision (a provision in letters of intent or merger agreements designed

to keep target businesses from “shopping”

around for transactions with other companies or investors on terms more

favorable to such target businesses) with respect to a particular proposed business combination, although we are not doing so

in connection with the Business Combination.

If we are required to seek additional capital,

we would need to borrow funds from our sponsor, management team or other third parties to operate or may be forced to liquidate.

Neither our sponsor, members of our management team nor any of their affiliates is under any obligation to advance funds to us

in such circumstances.

Any such advances would be repaid only from funds held outside the trust account or from funds released

to us upon completion of our initial business combination.

Up to $1,500,000 of such loans may be convertible into warrants of the

post-business combination entity at a price of $1.50 per warrant at the option of the lender.

The warrants would be identical to

the private placement warrants.

Prior to the completion of our initial business combination, we do not expect to seek loans from

parties other than our sponsor or an affiliate of our sponsor as we do not believe third parties will be willing to loan such funds

and provide a waiver against any and all rights to seek access to funds in our trust account.

If we are unable to complete our

initial business combination because we do not have sufficient funds available to us, we will be forced to cease operations and

liquidate the trust account.

Consequently, our public stockholders may only receive an estimated $10.00 per share, or possibly

less, on our redemption of our public shares, and our warrants will expire worthless.

Risks Related to Our Common Stock

and the Securities Market

The NYSE may delist our securities from

trading on its exchange, which could limit investors’

ability to make transactions in our securities and subject us to additional

trading restrictions.

We cannot assure you that we will continue to meet minimum initial listing standards to continue

to be listed on the NYSE in the future or prior to our initial business combination.

In order to continue listing our securities

on the NYSE prior to our initial business combination, we must maintain certain financial, distribution and stock price levels.

Generally, we must maintain a minimum number of holders of our securities (400 public holders).

Additionally, in connection with

our initial business combination, we will be required to demonstrate compliance with the NYSE’s initial listing requirements,

which are more rigorous than the NYSE’s continued listing requirements, in order to continue to maintain the listing of our

securities on the NYSE.

For instance, our stock price would generally be required to be at least $4.00 per share.

We cannot assure

you that we will be able to meet those initial listing requirements at that time.

If the NYSE delists our securities from

trading on its exchange and we are not able to list our securities on another national securities exchange, we expect our securities

could be quoted on an over-the-counter market.

If this were to occur, we could face significant material adverse consequences,

limited availability of market quotations for our securities;

liquidity for our securities;

determination that our Class A common stock is a “penny stock”

which will require brokers trading in our Class A

common stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading

market for our securities;

limited amount of news and analyst coverage;

decreased ability to issue additional securities or obtain additional financing in the future.

The National Securities Markets

Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain

securities, which are referred to as “covered securities.”

Because our units and our

Class A common stock and warrants are be listed on the NYSE, our units, Class A common stock and warrants will be

covered securities.

Although the states are preempted from regulating the sale of our securities, the federal statute does

allow the states to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent

activity, then the states can regulate or bar the sale of covered securities in a particular case.

While we are not aware of

a state having used these powers to prohibit or restrict the sale of securities issued by blank check companies, other than

the State of Idaho, certain state securities regulators view blank check companies unfavorably and might use these powers, or

threaten to use these powers, to hinder the sale of securities of blank check companies in their states.

Further, if we were

no longer listed on the NYSE, our securities would not be covered securities and we would be subject to regulation in each

state in which we offer our securities, including in connection with our initial business combination.

You will not be entitled to protections

normally afforded to investors of many other blank check companies.

Since the net proceeds of our Initial Public

Offering and the sale of the private placement warrants are intended to be used to complete an initial business combination with

a target business that has not been selected, we may be deemed to be a “blank check”

company under the United States

securities laws.

However, because we have net tangible assets in excess of $5,000,000 upon the completion of our Initial Public

Offering and the sale of the private placement warrants and filed a Current Report on Form 8-K, including an audited balance

sheet demonstrating this fact, we are exempt from rules promulgated by the SEC to protect investors in blank check companies, such

Accordingly, investors will not be afforded the benefits or protections of those rules.

Among other things, this

means our units will be immediately tradable and we will have a longer period of time to complete our initial business combination

than do companies subject to Rule 419.

Moreover, if our Initial Public Offering were subject to Rule 419, that rule would

prohibit the release of any interest earned on funds held in the trust account to us unless and until the funds in the trust account

were released to us in connection with our completion of an initial business combination.

If we are deemed to be an investment

company under the Investment Company Act, we may be required to institute burdensome compliance requirements and our activities

may be restricted, which may make it difficult for us to complete our initial business combination.

If we are deemed to be an investment company

under the Investment Company Act, our activities may be restricted, including:

on the nature of our investments;

on the issuance of securities, each of which may make it difficult for us to complete our initial business combination.

addition, we may have imposed upon us burdensome requirements, including:

as an investment company with the SEC;

of a specific form of corporate structure;

record keeping, voting, proxy and disclosure requirements and other rules and regulations that we are not subject to.

In order not to be regulated as an investment

company under the Investment Company Act, unless we can qualify for an exclusion, we must ensure that we are engaged primarily

in a business other than investing, reinvesting or trading of securities and that our activities do not include investing, reinvesting,

owning, holding or trading “investment securities”

constituting more than 40% of our assets (exclusive of U.S.

securities and cash items) on an unconsolidated basis.

Our business will be to identify and complete a business combination and

thereafter to operate the post-transaction business or assets for the long term.

We do not plan to buy businesses or assets with

a view to resale or profit from their resale.

We do not plan to buy unrelated businesses or assets or to be a passive investor.

We do not believe that our

anticipated principal activities will subject us to the Investment Company Act.

To this end, the proceeds held in the trust

account may only be invested in United States “government securities”

within the meaning of

Section 2(a)(16) of the Investment Company Act having a maturity of 185 days or less or in money market funds

meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act which invest only in direct U.S.

government treasury obligations.

Pursuant to the trust agreement, the trustee is not permitted to invest in other securities

By restricting the investment of the proceeds to these instruments, and by having a business plan targeted at

acquiring and growing businesses for the long term (rather than on buying and selling businesses in the manner of a merchant

bank or private equity fund), we intend to avoid being deemed an “investment company”

within the meaning of the

Investment Company Act.

Our public securities are not intended for persons who are seeking a return on investments in

government securities or investment securities.

The trust account is intended as a holding place for funds pending the

earliest to occur of either:

(i) the completion of our initial business combination;

(ii) the redemption of any

public shares properly tendered in connection with a stockholder vote to amend our amended and restated certificate of

incorporation to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete

our initial business combination within 24 months from the closing of our Initial Public Offering;

and (iii) absent an

initial business combination within 24 months from the closing of our Initial Public Offering or with respect to any other

material provisions relating to stockholders’

rights or pre-initial business combination activity, our return of the

funds held in the trust account to our public stockholders as part of our redemption of the public shares.

invest the proceeds as discussed above, we may be deemed to be subject to the Investment Company Act.

If we were deemed to be

subject to the Investment Company Act, compliance with these additional regulatory burdens would require additional expenses

for which we have not allotted funds and may hinder our ability to complete a business combination.

If we are unable to

complete our initial business combination, our public stockholders may only receive their pro rata portion of the funds in

the trust account that are available for distribution to public stockholders, and our warrants will expire worthless.

Our stockholders may be held liable

for claims by third parties against us to the extent of distributions received by them upon redemption of their shares.

Under the DGCL, stockholders may be held

liable for claims by third parties against a corporation to the extent of distributions received by them in a dissolution.

pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event

we do not complete our initial business combination within 24 months from the closing of our Initial Public Offering may be considered

a liquidating distribution under Delaware law.

If a corporation complies with certain procedures set forth in Section 280

of the DGCL intended to ensure that it makes reasonable provision for all claims against it, including a 60-day notice period during

which any third-party claims can be brought against the corporation, a 90-day period during which the corporation may reject any

claims brought, and an additional 150-day waiting period before any liquidating distributions are made to stockholders, any liability

of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder’s pro rata share

of the claim or the amount distributed to the stockholder, and any liability of the stockholder would be barred after the third

anniversary of the dissolution.

However, it is our intention to redeem our public shares as soon as reasonably possible following

the 24 th month from the closing of our Initial Public Offering ng in the event we do not complete our initial business

combination and, therefore, we do not intend to comply with the foregoing procedures.

Because we will not be complying with

Section 280, Section 281(b) of the DGCL requires us to adopt a plan, based on facts known to us at such time that

will provide for our payment of all existing and pending claims or claims that may be potentially brought against us within

the 10 years following our dissolution.

However, because we are a blank check company, rather than an operating company,

and our operations will be limited to searching for prospective target businesses to acquire, the only likely claims to arise

would be from our vendors (such as lawyers, investment bankers, etc.) or prospective target businesses.

If our plan of

distribution complies with Section 281(b) of the DGCL, any liability of stockholders with respect to a liquidating

distribution is limited to the lesser of such stockholder’s pro rata share of the claim or the amount distributed to

the stockholder, and any liability of the stockholder would likely be barred after the third anniversary of the dissolution.

We cannot assure you that we will properly assess all claims that may be potentially brought against us.

stockholders could potentially be liable for any claims to the extent of distributions received by them (but no more) and any

liability of our stockholders may extend beyond the third anniversary of such date.

Furthermore, if the pro rata portion of

our trust account distributed to our public stockholders upon the redemption of our public shares in the event we do not

complete our initial business combination within 24 months from the closing of our Initial Public Offering is not considered

a liquidating distribution under Delaware law and such redemption distribution is deemed to be unlawful (potentially due to

the imposition of legal proceedings that a party may bring or due to other circumstances that are currently unknown), then

pursuant to Section 174 of the DGCL, the statute of limitations for claims of creditors could then be six years after

the unlawful redemption distribution, instead of three years, as in the case of a liquidating distribution.

Our initial stockholders control a substantial

interest in us and thus may exert a substantial influence on actions requiring a stockholder vote, potentially in a manner that

you do not support.

Our initial stockholders own 20% of

our issued and outstanding common stock.

Accordingly, they may exert a substantial influence on actions requiring a

stockholder vote, potentially in a manner that you do not support, including amendments to our amended and restated

certificate of incorporation.

If our initial stockholders purchase any additional Class A common stock in the

aftermarket or in privately negotiated transactions, this would increase their control.

Neither our initial stockholders nor,

to our knowledge, any of our officers or directors, have any current intention to purchase additional securities, other than

as disclosed in this Report.

Factors that would be considered in making such additional purchases would include

consideration of the current trading price of our Class A common stock.

In addition, our board of directors, whose

members were elected by our sponsor, is and will be divided into three classes, each of which will generally serve for a

terms for three years with only one class of directors being elected in each year.

We may not hold an annual meeting of

stockholders to elect new directors prior to the completion of our initial business combination, in which case all of the

current directors will continue in office until at least the completion of the business combination.

As a consequence of our

“staggered”

board of directors, only a minority of the board of directors will be considered for election at our

annual meetings of stockholders prior to the consummation of our initial business combination, and our initial stockholders,

because of their ownership position, will have considerable influence regarding the outcome.

Accordingly, our initial

stockholders will continue to exert control at least until the completion of our initial business combination.

We may amend the terms of the warrants

in a manner that may be adverse to holders of public warrants with the approval by the holders of at least a majority of the then

outstanding public warrants.

As a result, the exercise price of your warrants could be increased, the exercise period could be

shortened and the number of shares of Class A common stock purchasable upon exercise of a warrant could be decreased, all

without your approval.

Our warrants will be issued in registered

form under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us.

agreement provides that the terms of the warrants may be amended without the consent of any holder to cure any ambiguity or correct

any defective provision, but requires the approval by the holders of at least a majority of the then outstanding public warrants

to make any change that adversely affects the interests of the registered holders of public warrants.

Accordingly, we may amend

the terms of the public warrants in a manner adverse to a holder if holders of at least a majority of the then outstanding public

warrants approve of such amendment.

Although our ability to amend the terms of the public warrants with the consent of at least

a majority of the then outstanding public warrants is unlimited, examples of such amendments could be amendments to, among other

things, increase the exercise price of the warrants, convert the warrants into cash or stock (at a ratio different than initially

provided), shorten the exercise period or decrease the number of shares of Class A common stock purchasable upon exercise

of a warrant.

Our warrant agreement will designate

the courts of the State of New York or the United States District Court for the Southern District of New York as

the sole and exclusive forum for certain types of actions and proceedings that may be initiated by holders of our warrants, which

could limit the ability of warrant holders to obtain a favorable judicial forum for disputes with our company.

Our warrant agreement will provide that,

subject to applicable law, (i) any action, proceeding or claim against us arising out of or relating in any way to the warrant

agreement, including under the Securities Act, will be brought and enforced in the courts of the State of New York or the

United States District Court for the Southern District of New York, and (ii) that we irrevocably submit to such

jurisdiction, which jurisdiction shall be the exclusive forum for any such action, proceeding or claim.

We will waive any objection

to such exclusive jurisdiction and that such courts represent an inconvenient forum.

Notwithstanding the foregoing, these

provisions of the warrant agreement will not apply to suits brought to enforce any liability or duty created by the Exchange

Act or any other claim for which the federal district courts of the United States of America are the sole and exclusive

Any person or entity purchasing or otherwise acquiring any interest in any of our warrants shall be deemed to have

notice of and to have consented to the forum provisions in our warrant agreement.

If any action, the subject matter of which

is within the scope the forum provisions of the warrant agreement, is filed in a court other than a court of the State of

New York or the United States District Court for the Southern District of New York (a “foreign

action”) in the name of any holder of our warrants, such holder shall be deemed to have consented to:

personal jurisdiction of the state and federal courts located in the State of New York in connection with any action

brought in any such court to enforce the forum provisions (an “enforcement action”), and (y) having service

of process made upon such warrant holder in any such enforcement action by service upon such warrant holder’s counsel

in the foreign action as agent for such warrant holder.

This choice-of-forum provision may limit

a warrant holder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with our company, which

may discourage such lawsuits.

Alternatively, if a court were to find this provision of our warrant agreement inapplicable or unenforceable

with respect to one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving

such matters in other jurisdictions, which could materially and adversely affect our business, financial condition and results

of operations and result in a diversion of the time and resources of our management and board of directors.

We may redeem your unexpired warrants

prior to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless.

We have the ability to redeem outstanding

warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant, provided that

the closing price of our Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock capitalizations,

reorganizations, recapitalizations and the like) for any 20 trading days within a 30 trading-day period commencing once the warrants

become exercisable and ending on the third trading day prior to proper notice of such redemption provided that on the date we give

notice of redemption.

We will not redeem the warrants unless an effective registration statement under the Securities Act covering

the shares of Class A common stock issuable upon exercise of the warrants is effective and a current prospectus relating to

those shares of Class A common stock is available throughout the 30-day redemption period, except if the warrants may be exercised

on a cashless basis and such cashless exercise is exempt from registration under the Securities Act.

If and when the warrants become

redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for

sale under all applicable state securities laws.

Redemption of the outstanding warrants could force you to (i) exercise your

warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so, (ii) sell your warrants

at the then current market price when you might otherwise wish to hold your warrants or (iii) accept the nominal redemption

price which, at the time the outstanding warrants are called for redemption, is likely to be substantially less than the market

value of your warrants.

None of the private placement warrants will be redeemable by us so long as they are held by their initial

purchasers or their permitted transferees.

You will not be permitted to exercise

your warrants unless we register and qualify the underlying Class A common stock or certain exemptions are available.

If the issuance of the Class A common

stock upon exercise of the warrants is not registered, qualified or exempt from registration or qualification under the Securities

Act and applicable state securities laws, holders of warrants will not be entitled to exercise such warrants and such warrants

may have no value and expire worthless.

In such event, holders who acquired their warrants as part of a purchase of units will

have paid the full unit purchase price solely for the Class A common stock included in the units.

We are not registering the Class A

common stock issuable upon exercise of the warrants under the Securities Act or any state securities laws at this time.

under the terms of the warrant agreement, we have agreed that, as soon as practicable, but in no event later than 15 business days,

after the closing of our initial business combination, we will use our best efforts to file with the SEC a registration statement

covering the registration under the Securities Act of the Class A common stock issuable upon exercise of the warrants and

thereafter will use our best efforts to cause the same to become effective within 60 business days following our initial business

combination and to maintain a current prospectus relating to the Class A common stock issuable upon exercise of the warrants

until the expiration of the warrants in accordance with the provisions of the warrant agreement.

We cannot assure you that we will

be able to do so if, for example, any facts or events arise which represent a fundamental change in the information set forth in

the registration statement or prospectus, the financial statements contained or incorporated by reference therein are not current

or correct or the SEC issues a stop order.

If the shares of Class A common stock

issuable upon exercise of the warrants are not registered under the Securities Act, under the terms of the warrant agreement, holders

of warrants who seek to exercise their warrants will not be permitted to do so for cash and, instead, will be required to do so

on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption.

In no event will warrants be exercisable

for cash or on a cashless basis, and we will not be obligated to issue any shares to holders seeking to exercise their warrants,

unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising

holder, or an exemption from registration or qualification is available.

If our shares of Class A common stock

are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition

of “covered securities”

under Section 18(b)(1) of the Securities Act, we may, at our option, not permit holders

of warrants who seek to exercise their warrants to do so for cash and, instead, require them to do so on a cashless basis in accordance

with Section 3(a)(9) of the Securities Act;

in the event we so elect, we will not be required to file or maintain in effect

a registration statement or register or qualify the shares underlying the warrants under applicable state securities laws, and

in the event we do not so elect, we will use our best efforts to register or qualify the shares underlying the warrants under applicable

state securities laws to the extent an exemption is not available.

In no event will we be required to net

cash settle any warrant, or issue securities (other than upon a cashless exercise as described above) or other compensation in

exchange for the warrants in the event that we are unable to register or qualify the shares underlying the warrants under the Securities

Act or applicable state securities laws.

You may only be able to exercise your

public warrants on a “cashless basis”

under certain circumstances, and if you do so, you will receive fewer shares

of Class A common stock from such exercise than if you were to exercise such warrants for cash.

The warrant agreement provides that in

the following circumstances holders of warrants who seek to exercise their warrants will not be permitted to do for cash and will,

instead, be required to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act:

shares of Class A common stock issuable upon exercise of the warrants are not registered under the Securities Act in accordance

with the terms of the warrant agreement;

(ii) if we have so elected and the shares of Class A common stock is at the

time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of “covered

securities”

under Section 18(b)(1) of the Securities Act;

and (iii) if we have so elected and we call the public

warrants for redemption.

If you exercise your public warrants on a cashless basis, you would pay the warrant exercise price by

surrendering the warrants for that number of shares of Class A common stock equal to the quotient obtained by dividing (x) the

product of the number of shares of Class A common stock underlying the warrants, multiplied by the excess of the “fair

market value”

of our shares of Class A common stock (as defined in the next sentence) over the exercise price of the

warrants by (y) the fair market value.

The “fair market value”

is the average reported closing price of the shares

of Class A common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of exercise

is received by the warrant agent or on which the notice of redemption is sent to the holders of warrants, as applicable.

you would receive fewer shares of Class A common stock from such exercise than if you were to exercise such warrants for cash.

Our sponsor paid an aggregate of $25,000

to cover certain of our offering costs in exchange for 14,375,000 founder shares, or approximately $0.002 per founder share and,

accordingly, the purchasers of our Class A Common Stock in our Initial Public Offering experienced substantial dilution from the

purchase of our shares of Class A common stock.

The difference between the public

offering price per share (allocating all of the unit purchase price to the share of Class A common stock and none to the

warrant included in the unit) and the pro forma net tangible book value per share of our Class A common stock after our

Initial Public Offering constituted dilution to the purchasers of our Class A Common Stock in the Initial Public Offering.

Our initial stockholders acquired the founder shares at a nominal price, significantly contributing to this dilution.

closing of our Initial Public Offering, and assuming no value is ascribed to the warrants included in the units, the public

stockholders that purchased Class A Common Stock in our Initial Public Offering incurred immediate and substantial dilution

of approximately 96.1% or $9.61 per share, the difference between the pro forma net tangible book value per share after this

offering of $0.39 and the initial offering price of $10.00 per unit.

This dilution would increase to the extent that the

anti-dilution provisions of the founder shares result in the issuance of shares of Class A common stock on a greater

than one-to-one basis upon conversion of the founder shares at the time of our initial business combination and would become

exacerbated to the extent that public stockholders seek redemptions from the trust for their public shares.

because of the anti-dilution protection in the founder shares, any equity or equity-linked securities issued in connection

with our initial business combination would be disproportionately dilutive to our Class A common stock.

The determination of the offering price

of our units, the size of this offering and terms of the units is more arbitrary than the pricing of securities and size of an

offering of an operating company in a particular industry.

You may have less assurance, therefore, that the offering price of our

units properly reflects the value of such units than you would have in a typical offering of an operating company.

Prior to our Initial Public Offering there

was no public market for any of our securities.

The public offering price of the units and the terms of the warrants were negotiated

between us and the underwriters.

In determining the size of this offering, management held customary organizational meetings with

representative of the underwriters, both prior to our inception and thereafter, with respect to the state of capital markets, generally,

and the amount the underwriters believed they reasonably could raise on our behalf.

Factors considered in determining the size

of this offering, prices and terms of the units, including the Class A common stock and warrants underlying the units, include:

history and prospects of companies whose principal business is the acquisition of other companies;

offerings of those companies;

prospects for acquiring an operating business at attractive values;

review of debt to equity ratios in leveraged transactions;

capital structure;

assessment of our management and their experience in identifying operating companies;

conditions of the securities markets at the time of this offering;

factors as were deemed relevant.

Although these factors were considered,

the determination of our offering size, price and terms of the units is more arbitrary than the pricing of securities of an operating

company in a particular industry since we have no historical operations or financial results.

We are an emerging growth company and

a smaller reporting company within the meaning of the Securities Act, and if we take advantage of certain exemptions from disclosure

requirements available to emerging growth companies or smaller reporting companies, this could make our securities less attractive

to investors and may make it more difficult to compare our performance with other public companies.

We are an “emerging growth company”

within the meaning of the Securities Act, as modified by the JOBS Act, and we 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 auditor internal controls attestation requirements of Section 404 of the

Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our 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.

As a result, our stockholders may not have access to certain information

they may deem important.

We could be an emerging growth company for up to five years, although circumstances could cause us to

lose that status earlier, including if the market value of our Class A common stock held by non-affiliates exceeds $700 million

as of any June 30 before that time, in which case we would no longer be an emerging growth company as of the following December

We cannot predict whether investors will find our securities less attractive because we will rely on these exemptions.

investors find our securities less attractive as a result of our reliance on these exemptions, the trading prices of our securities

may be lower than they otherwise would be, there may be a less active trading market for our securities and the trading prices

of our securities may be more volatile.

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 an election to opt out is irrevocable.

We have 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, we, 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 our 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.

Additionally, we are a “smaller reporting

company”

as defined in Item 10(f)(1) of Regulation S-K.

Smaller reporting companies may take advantage of certain reduced

disclosure obligations, including, among other things, providing only two years of audited financial statements.

We will remain

a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by

non-affiliates exceeds $250 million as of the prior June 30 th , and (2) our annual revenues exceeded $100 million

during such completed fiscal year and the market value of our common stock held by non-affiliates exceeds $700 million as of the

prior June 30 th .

To the extent we take advantage of such reduced disclosure obligations, it may also make comparison

of our financial statements with other public companies difficult or impossible.

Provisions in our amended and restated

certificate of incorporation and Delaware law may inhibit a takeover of us, which could limit the price investors might be willing

to pay in the future for our shares of Class A common stock and could entrench management.

Our amended and restated certificate of

incorporation contains provisions that may discourage unsolicited takeover proposals that stockholders may consider to be in their

best interests.

These provisions include a staggered board of directors and the ability of the board of directors to designate

the terms of and issue new series of preferred stock, which may make more difficult the removal of management and may discourage

transactions that otherwise could involve payment of a premium over prevailing market prices for our securities.

We are also subject to anti-takeover provisions

under Delaware law, which could delay or prevent a change of control.

Together these provisions may make the removal of management

more difficult and may discourage transactions that otherwise could involve payment of a premium over prevailing market prices

for our securities.

General Risk Factors

Past performance by our management team

and their affiliates may not be indicative of future performance of an investment in us.

Information regarding performance by, or

businesses associated with, our management team or businesses associated with them is presented for informational purposes only.

The past performance of our management team or their respective affiliates is not a guarantee of either:

(i) success with

respect to any business combination we may consummate;

or (ii) that we will be able to identify a suitable candidate for our

initial business combination.

No member of our management team has had significant management experience with special purpose acquisition

companies in the past.

You should not rely on the historical record of our management team’s or their respective affiliates’

performance as indicative of any future performance.

We are dependent upon our executive

officers and directors and their loss could adversely affect our ability to operate.

Our operations are dependent upon a

relatively small group of individuals and, in particular, our executive officers and directors.

We believe that our success

depends on the continued service of our officers and directors, at least until we have completed our initial business

In addition, our executive officers and directors are not required to commit any specified amount of time to our

affairs and, accordingly, will have conflicts of interest in allocating their time among various business activities,

including identifying potential business combinations and monitoring the related due diligence.

We do not have an employment

agreement with, or key-man insurance on the life of, any of our directors or executive officers.

The unexpected loss of the

services of one or more of our directors or executive officers could have a detrimental effect on us.

Our executive officers, directors, security

holders and their respective affiliates may have competitive pecuniary interests that conflict with our interests.

We have not adopted a policy that expressly

prohibits our directors, executive officers, security holders or affiliates from having a direct or indirect pecuniary or financial

interest in any investment to be acquired or disposed of by us or in any transaction to which we are a party or have an interest.

In fact, we may enter into a business combination with a target business that is affiliated with our sponsor, our directors or

executive officers, although we do not intend to do so.

Nor do we have a policy that expressly prohibits any such persons from

engaging for their own account in business activities of the types conducted by us.

Accordingly, such persons or entities may have

a conflict between their interests and ours.

The personal and financial interests of

our directors and officers may influence their motivation in timely identifying and selecting a target business and completing

a business combination.

Consequently, our directors’

and officers’

discretion in identifying and selecting a suitable

target business may result in a conflict of interest when determining whether the terms, conditions and timing of a particular

business combination are appropriate and in our stockholders’

best interest.

If this were the case, it would be a breach

of their fiduciary duties to us as a matter of Delaware law and we or our stockholders might have a claim against such individuals

for infringing on our stockholders’

However, we might not ultimately be successful in any claim we may make against

them for such reason.

A market for securities may

not be sustained, which would adversely affect the liquidity and price of our securities, or the trading price of our

securities may be highly volatile.

Prior to the Initial Public Offering, there

was currently no market for our securities.

Stockholders did not have any access to information about prior market history on which

to base their investment decision.

Following the Initial Public Offering, the price of our securities may vary significantly due

to one or more potential business combinations and general market or economic conditions and may be highly volatile.

an active trading market for our securities may not be sustained.

You may be unable to sell your securities unless a market can

be established and sustained.

Cyber incidents or attacks directed

at us could result in information theft, data corruption, operational disruption and/or financial loss.

We depend on digital technologies, including

information systems, infrastructure and cloud applications and services, including those of third parties with which we may deal.

Sophisticated and deliberate attacks on, or security breaches in, our systems or infrastructure, or the systems or infrastructure

of third parties or the cloud, could lead to corruption or misappropriation of our assets, proprietary information and sensitive

or confidential data.

As an early stage company without significant investments in data security protection, we may not be sufficiently

protected against such occurrences.

We may not have sufficient resources to adequately protect against, or to investigate and remediate

any vulnerability to, cyber incidents.

It is possible that any of these occurrences, or a combination of them, could have adverse

consequences on our business and lead to financial loss.

Our search for a business combination,

and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the

recent coronavirus (COVID-19) outbreak.

In December 2019, a novel strain

of coronavirus has and is continuing to spread throughout parts of the world, including the United States.

30, 2020, the World Health Organization declared the outbreak of the coronavirus disease (COVID-19) a “Public Health

Emergency of International Concern.”

On January 31, 2020, U.S.

Health and Human Services Secretary Alex M.

declared a public health emergency for the United States to aid the U.S.

healthcare community in responding to COVID-19,

and on March 11, 2020 the World Health Organization characterized the outbreak as a “pandemic”.

A significant

outbreak of COVID-19 and other infectious diseases could result in a widespread health crisis that could adversely affect the

economies and financial markets worldwide, and the business of any potential target business with which we consummate a

business combination could be materially and adversely affected.

Furthermore, we may be unable to complete a business

combination if continued concerns relating to COVID-19 restrict travel, limit the ability to have meetings with potential

investors or the target company’s personnel, vendors and services providers are unavailable to negotiate and consummate

a transaction in a timely manner.

The extent to which COVID-19 impacts our search for a business combination will depend on

future developments, which are highly uncertain and cannot be predicted, including new information which may emerge

concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others.

If the disruptions

posed by COVID-19 or other matters of global concern continue for an extensive period of time, our ability to consummate a

business combination, or the operations of a target business with which we ultimately consummate a business combination, may

be materially adversely affected.

Risks Related to Archer’s Business

and Industry and New Archer Following the Business Combination

Archer is an early stage company with a history of losses,

and expects to incur significant expenses and continuing losses for the foreseeable future.

Archer incurred a net loss of $24.8 million

for the year ended December 31, 2020 and has incurred a net loss of approximately $25.8 million since inception through December

Archer believes that it will continue to incur operating and net losses each quarter until at least the time it begins

significant deliveries of its eVTOL aircraft, which are not expected to begin until late 2024/2025 and may occur later or not at

Even if Archer is able to successfully develop and sell its aircraft, there can be no assurance that they will be financially

Archer’s potential profitability is dependent upon the successful development and successful commercial introduction

and acceptance of its aircraft, which may not occur.

Archer expects the rate at which it will

incur losses to be significantly higher in future periods as Archer:

continues to design, develop, manufacture and market its aircraft;

continues to utilize its third-party partners for design, supply and manufacturing;

expands its production capabilities, including costs associated with outsourcing the manufacturing of its aircraft;

builds up inventories of parts and components for its aircraft;

manufactures an inventory of its aircraft;

expands its design, development and servicing capabilities;

increases its sales and marketing activities and develops its distribution infrastructure;

increases its general and administrative functions to support its growing operations and to operate as a public company.

Because Archer will incur the costs and

expenses from these efforts before it receives any incremental revenues with respect thereto, Archer’s losses in future periods

will be significant.

In addition, Archer may find that these efforts are more expensive than it currently anticipates or that these

efforts may not result in revenues, which would further increase Archer’s losses.

Archer has not yet manufactured or delivered any aircraft

to customers, which makes evaluating Archer’s business and future prospects difficult and increases the risk of investment.

Archer was incorporated in October 2018

and has a limited operating history in the urban air mobility industry, which is continuously evolving.

Archer’s aircraft

are in the development stage and Archer does not expect its first vehicle to be produced until 2024, if at all.

Archer has no experience

as an organization in high volume manufacturing of the planned aircraft.

Archer cannot assure you that it or its partners will

be able to develop efficient, automated, cost-efficient manufacturing capability and processes, and reliable sources of component

supplies that will enable Archer to meet the quality, price, engineering, design and production standards, as well as the production

volumes, required to successfully mass market its aircraft.

You should consider Archer’s business and prospects in light

of the risks and significant challenges it faces as a new entrant into its industry, including, among other things, with respect

to its ability to:

design and produce safe, reliable and quality aircraft on an ongoing basis;

obtain the necessary regulatory approvals in a timely manner, including receipt of governmental authority for manufacturing

the equipment and, in turn, marketing, selling and operating Archer’s UAM service;

Investing in our securities involves risks.

You should consider carefully the risks and uncertainties described below, together with all of the other information in this Annual Report, including Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and related notes, before deciding whether to purchase any of our securities.

Our business, results of operations, financial condition, and prospects could also be harmed by risks and uncertainties that are not presently known to us or that we currently believe are not material.

If any of these risks actually occur, our business, results of operations, financial condition, and prospects could be materially and adversely affected.

Unless otherwise indicated, references in these risk factors to our business being harmed will include harm to our business, reputation, brand, financial condition, results of operations, and prospects.

In such event, the market price of our securities could decline, and you could lose all or part of your investment.

Risks Related to Our Business and Industry

We are an early-stage company with a history of losses, and we expect to incur significant expenses and continuing losses for the foreseeable future.

As of December 31, 2021, we have incurred a year-to-date net loss of $347.8 million, and we have incurred a net loss of approximately $373.6 million since inception.

We believe that we will continue to incur operating and net losses each quarter until at least the time we begin generating significant revenues from our planned lines of business, which is not expected to occur until late 2024 or 2025, and may occur later or not at all.

Even if we are able to successfully launch our Archer UAM or Archer Direct lines of business, there can be no assurance that such lines of business will be financially successful.

Our potential profitability is dependent upon the successful development and successful commercial introduction and acceptance of our aircraft, which may not occur.

We expect the rate at which we will incur losses to be significantly higher in future periods as we:

• continue to design, develop, manufacture, certify and market our aircraft;

• continue to design and develop the Archer UAM network;

• continue to utilize third parties to assist us with the design, development, manufacturing, certification and marketing of our aircraft and UAM network;

• continue to attract, retain and motivate talented employees;

• expand our aircraft manufacturing capabilities, including costs associated with the manufacturing of our aircraft;

• build up inventories of parts and components for our aircraft;

• manufacture an inventory of our aircraft;

• expand our design, development and servicing capabilities;

• increase our sales and marketing activities and develop our distribution infrastructure;

• work with third-party partners to develop pilot training programs;

• increase our general and administrative functions to support our growing operations and operations as a public company.

Because we will incur the costs and expenses from these efforts before we receive any incremental revenues with respect thereto, our losses in future periods are expected to be significant.

In addition, we may find that these efforts are more expensive than we currently anticipate or that these efforts may not result in the revenues we expect, which could further increase our losses.

We are still developing our fully operational demonstrator eVTOL aircraft, have not yet obtained FAA certification of our production eVTOL aircraft under development and we have yet to manufacture or deliver any aircraft to customers, which makes evaluating our business and future prospects difficult and increases the risk of investment.

We were incorporated in October 2018 and have a limited operating history in designing, developing, and working to certify an eVTOL aircraft.

Our eVTOL aircraft is in the development stage and we do not expect our first production vehicle to be produced until 2024, 2025 or later.

We are still working to obtain FAA type certification of our eVTOL aircraft (including the G-2 and G-3 Issue Paper milestones, which, among other things, establish the applicable airworthiness and environmental regulations, special conditions, and procedural requirements that must be met to achieve FAA type certification).

As a result, we have no experience as an organization in high volume manufacturing of aircraft.

Some of our current and potential competitors are larger and have substantially greater resources than we have and expect to have in the future.

As a result, those competitors may be able to devote greater resources to the development of their current and future technologies, the promotion and sale of their offerings, and/or offer their technologies at lower prices.

In particular, our competitors may be able to receive Type, Airworthiness or Production certification from the FAA covering their eVTOL aircraft prior to us receiving such certificates.

Our current and potential competitors may also establish cooperative or strategic relationships amongst themselves or with third parties that may further enhance their resources and offerings.

Further, it is possible that domestic or foreign companies or governments, some with greater experience in the aerospace industry or greater financial resources than we possess, will seek to provide products or services that compete directly or indirectly with ours in the future.

Any such foreign competitor, for example, could benefit from subsidies from, or other protective measures by, its home country.

We cannot assure you that we or our partners will be able to develop efficient, automated, cost-efficient manufacturing capability and processes, and reliable sources of component supplies that will enable us to meet the quality, price, engineering, design and production standards, as well as the production volumes, required to successfully commercialize our aircraft.

You should consider our business and prospects in light of the risks and significant challenges we face as a new entrant into a new industry, including, among other things, with respect to our ability to:

• design and manufacture safe, reliable and quality aircraft on an ongoing basis;

• obtain the necessary regulatory approvals in a timely manner, including receipt of FAA certifications covering our aircraft and, in turn, any other government approvals necessary for manufacturing, marketing, selling and operating the Archer UAM service;

• build a well-recognized and respected brand;

establish and expand its customer base;

successfully market not just Archer’s aircraft but also the other services it intends to provide, such as aerial ride

sharing services;

successfully service its aircraft after sales and maintain a good flow of spare parts and customer goodwill;

improve and maintain its operational efficiency;

successfully execute its manufacturing and production model and maintain a reliable, secure, high-performance and scalable

technology infrastructure;

predict its future revenues and appropriately budget for its expenses;

• establish and expand our customer base;

• successfully market not just our aircraft but also the other services we intend to provide, such as aerial ride sharing services;

• successfully service our aircraft after sales and maintain a good flow of spare parts and customer goodwill;

• improve and maintain our operational efficiency;

• successfully execute our manufacturing and production model and maintain a reliable, secure, high-performance and scalable technology infrastructure;

• predict our future revenues and appropriately budget for our expenses;

• attract, retain and motivate talented employees;

anticipate trends that may emerge and affect its business;

• anticipate trends that may emerge and affect our business;

• anticipate and adapt to changing market conditions, including technological developments and changes in competitive landscape;

• navigate an evolving and complex regulatory environment.

If Archer fails to adequately address any

or all of these risks and challenges, its business may be harmed.

The United Airlines purchase agreement has a conditional

purchase order which constitutes all of the current orders for Archer aircraft.

If the conditions to United Airlines’

are not met, or if this order is cancelled, modified or delayed, Archer’s prospects, results of operations, liquidity and

cash flow will be harmed.

The United Airlines purchase agreement

has a conditional purchase order which constitutes all of the current orders for Archer aircraft.

This order and the purchase agreement

between Archer and United Airlines are subject to conditions, including certification of Archer’s aircraft by the Federal

Aviation Authority (FAA), and further negotiation and reaching mutual agreement on certain material terms, such as aircraft specifications,

warranties, usage and transfer of the aircraft, performance guarantees, delivery periods, most favored nation provisions, the type

and extent of assistance to be provided by United Airlines in obtaining certification of the aircraft, territorial restrictions,

rights to jointly developed intellectual property, escalation adjustments and other matters.

The obligations of United Airlines

to consummate the order will arise only after all of such material terms are agreed in the discretion of each party.

in addition to other termination rights set forth in the purchase agreement and the collaboration agreement, if the parties do

not agree on such material terms, either party will have the right to terminate the agreements if such party determines in its

discretion that it is not likely that such material terms will be agreed in a manner that is consistent with such party’s

business and operational interests (as those interests may change from time to time).

If this order is cancelled, modified or delayed,

or otherwise not consummated, or if Archer is otherwise unable to convert its strategic relationships or collaborations into sales

revenue, Archer’s prospects, results of operations, liquidity and cash flow will be affected.

Archer’s business plans require a significant amount

In addition, its future capital needs may require Archer to sell additional equity or debt securities that may dilute

its stockholders or introduce covenants that may restrict its operations or its ability to pay dividends.

Archer expects its capital expenditures

to continue to be significant in the foreseeable future as it expands its business, and that its level of capital expenditures

will be significantly affected by customer demand for its aircraft.

Archer expects that following the Closing, Archer will have

sufficient capital to fund its currently planned operations based on current projections, which are subject to change.

however, Archer expects to make significant investments in its business, including development of its aircraft and investments

in its brand.

These efforts may prove more expensive than currently anticipated, and Archer may not succeed in acquiring sufficient

capital to offset these higher expenses and achieve positive revenue generation.

The fact that Archer has a limited operating history

means it has limited historical data on the demand for its aircraft.

As a result, Archer’s future capital requirements may

be uncertain and actual capital requirements may be different from those it currently anticipates.

Archer may need to seek equity

or debt financing to finance a portion of its capital expenditures.

Such financing might not be available to Archer in a timely

manner or on terms that are acceptable, or at all.

Archer’s ability to obtain the necessary

financing to carry out its business plan is subject to a number of factors, including general market conditions and investor acceptance

of Archer’s business model.

These factors may make the timing, amount, terms and conditions of such financing unattractive

or unavailable to Archer.

If Archer is unable to raise sufficient funds, it will have to significantly reduce its spending, delay

or cancel its planned activities or substantially change its corporate structure.

Archer might not be able to obtain any funding,

and it might not have sufficient resources to conduct its business as projected, both of which could mean that Archer would be

forced to curtail or discontinue its operations.

In addition, Archer’s future capital

needs and other business reasons could require it to sell additional equity or debt securities or obtain a credit facility.

sale of additional equity or equity-linked securities could dilute its stockholders.

The incurrence of indebtedness would result

in increased debt service obligations and could result in operating and financing covenants that would restrict Archer’s

operations or its ability to pay dividends to its stockholders.

If Archer cannot raise additional funds

when it needs or want them, its operations and prospects could be negatively affected.

Archer intends to seek forgiveness on its PPP loan but

may not be successful in obtaining forgiveness.

On April 9, 2020,

Archer obtained a loan of approximately $905,000 pursuant to the Paycheck Protection Program (the “

PPP ”) under

Division A, Title I of the CARES Act.

Interest accrues on the PPP Loan at a rate of 0.98% per annum and matures on April 9, 2022.

The loans and accrued interest are forgivable after twenty-four (24)

weeks so long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities.

intends to apply for loan forgiveness under the CARES Act.

Whether forgiveness will be granted and in what amount is

subject to an application to, and approval by, the Small Business Administration (the “

SBA ”) and may also be

subject to further requirements in any regulations and guidelines the SBA may adopt, and therefore, it is uncertain whether Archer

will be successful in obtaining forgiveness on the loan.

Archer identified material weaknesses in its internal

control over financial reporting.

If Archer is unable to remediate these material weaknesses, or if it identifies additional material

weaknesses in the future or otherwise fails to maintain an effective system of internal controls, it may not be able to accurately

or timely report its financial condition or results of operations, which may adversely affect Archer’s business and stock

In connection with the preparation and

audit of Archer’s financial statements for the year ended December 31, 2020, material weaknesses were identified in Archer’s

internal control over financial reporting.

A material weakness is a deficiency, or a combination of deficiencies, in internal control

over financial reporting such that there is a reasonable possibility that a material misstatement of Archer’s annual or interim

financial statements will not be prevented or detected on a timely basis.

These material weaknesses are as follows:

Archer did not design and maintain an effective control environment commensurate with its financial reporting requirements.

Archer lacked a sufficient number of trained professionals with (i) an appropriate level of accounting knowledge, training and

experience to appropriately analyze, record and disclose accounting matters timely and accurately, and (ii) an appropriate level

of knowledge and experience to establish effective processes and controls.

Additionally, the limited personnel resulted in an inability

to consistently establish appropriate authorities and responsibilities in pursuit of financial reporting objectives, as demonstrated

by, among other things, insufficient segregation of duties in its finance and accounting functions.

This material weakness in the control environment

contributed to the following additional material weaknesses:

Archer did not design and maintain an effective risk assessment process at a precise enough level to identify new and evolving

risks of material misstatement in Archer’s financial statements.

Specifically, changes to existing controls or the implementation

of new controls have not been sufficient to respond to changes to the risks of material misstatement to financial reporting.

Archer did not design and maintain formal accounting policies, procedures and controls to achieve complete, accurate and timely

financial accounting, reporting and disclosures, including controls over the preparation and review of business performance reviews,

account reconciliations and journal entries.

Archer did not design and maintain effective controls over information technology (“

IT ”) general controls

for information systems that are relevant to the preparation of their financial statements.

Specifically, Archer did not design

and maintain:

o user access controls to ensure appropriate segregation of duties and that adequately restrict user and privileged access to

financial applications, programs, and data to appropriate company personnel;

o program change management controls to ensure that IT program and data changes affecting financial IT applications and underlying

accounting records are identified, tested, authorized, and implemented appropriately;

o computer operations controls to ensure that data backups are authorized and monitored.

These material weaknesses resulted in immaterial

audit adjustments to the research and development expense and property and equipment line items in our financial statements and

related disclosures for the years ended December 31, 2020 and 2019.

Additionally, each of these material weaknesses could result

in a misstatement of substantially all of Archer’s accounts or disclosures that would result in a material misstatement to

the annual or interim financial statements that would not be prevented or detected.

Archer has begun implementation of a plan

to remediate these material weaknesses described above.

If we fail to adequately address any or all of these risks and challenges, our business may be harmed.

Our Purchase Agreement with United is conditional and is currently the only order for our aircraft.

If the order conditions are not met, or if this order is otherwise cancelled, modified or delayed, our prospects, results of operations, liquidity and cash flow will be harmed.

Our Purchase Agreement with United is conditional and is currently the only order for our aircraft.

Those conditions include, among other things, us receiving certification of our aircraft by the FAA and further negotiation and reaching mutual agreement on certain material terms, such as aircraft specifications, warranties, usage and transfer of the aircraft, performance guarantees, delivery periods, most favored nation provisions, the type and extent of assistance to be provided by United in obtaining certification of the aircraft for its intended use, territorial restrictions, rights to jointly developed intellectual property, escalation adjustments and other matters.

The obligations of United to consummate the order will arise only after all of such material terms are agreed by the parties.

Further, and in addition to other termination rights set forth in the Purchase Agreement and the Collaboration Agreement with United (the “United Collaboration Agreement”), if the parties do not agree on such material terms, either party will have the right to terminate the agreements if such party determines in its discretion that it is not likely that such material terms will be agreed in a manner that is consistent with such party’s business and operational interests (as those interests may change from time to time).

If this order is cancelled, modified or delayed, or otherwise not consummated, or if we are otherwise unable to convert our strategic relationships or collaborations into sales revenue, our prospects, results of operations, liquidity and cash flow will be affected.

Our business plan requires a significant amount of capital.

In addition, our future capital needs may require us to sell additional equity or debt securities that may dilute our stockholders or introduce covenants that may restrict our operations or our ability to pay dividends.

We expect our capital expenditures and operating expenses to continue to be significant in the foreseeable future as we develop our aircraft and business, and that our level of capital expenditures and operating expenses will be significantly affected by the aircraft development and certification process as well as subsequent customer demand for our aircraft.

We believe our current cash balances will be sufficient to fund our current operating plan for at least the next 12 months.

However, we expect that in the coming years we will need to make significant investments in our business, including development of our aircraft, bring up of manufacturing capabilities, the infrastructure to support Archer UAM, and investments in our brand.

In addition, over the next few years we expect to continue to incur ongoing expenses related to the Wisk Aero LLC (“Wisk”) litigation, which are difficult to predict.

See our other risk factor titled “We have been sued by a competitor alleging misappropriation by us of certain of their trade secrets and infringement by us of certain of their patents.

These proceedings, as well as any other proceedings relating to these allegations and similar allegations or legal proceedings in the future, may be time-consuming and expensive and, if adversely determined, could delay, limit or prevent our ability to commercialize our aircraft or otherwise execute on our business plans.” These investments and expenses may be greater than currently anticipated or there may be investments or expenses that are unforeseen, and we may not succeed in acquiring sufficient capital to offset these higher expenses and achieve significant revenue generation.

We have a limited operating history and no historical data on the demand for our planned Archer UAM and Archer Direct businesses.

As a result, our future capital requirements are difficult to predict and our actual capital requirements may be different from those we currently anticipate.

We may need to seek equity or debt financing to finance a portion of our future capital requirements.

Such financing might not be available to us when needed or on terms that are acceptable, or at all.

Our ability to obtain the necessary financing to carry out our business plan is subject to a number of factors, including general market conditions and investor acceptance of our planned business model.

These factors may make the timing, amount, terms and conditions of such financing unattractive or unavailable to us.

If we are unable to raise sufficient capital, we may

have to significantly reduce our spending and/or delay or cancel our planned activities.

We might not be able to obtain any financing, and we might not have sufficient capital to conduct our business as projected, both of which could mean that we would be forced to curtail or discontinue our operations.

In addition, our future capital needs and other business needs or plans could require us to sell additional equity or debt securities or obtain a credit facility.

The sale of additional equity or equity-linked securities could dilute our stockholders.

The incurrence of indebtedness would also result in increased debt service obligations and could result in operating and financing covenants that would restrict our operations or our ability to pay dividends to our stockholders.

If we cannot raise additional capital when we need or want to, our operations and prospects could be negatively affected.

Our future success depends on the continuing efforts of our key employees and on our ability to attract and retain highly skilled personnel and senior management.

Our future success depends, in part, on our ability to continue to attract and retain highly skilled personnel.

In particular, we are highly dependent on the contributions of our co-founders, Brett Adcock and Adam Goldstein, as well as other members of our management team.

The loss of any key personnel could make it more difficult to achieve on our business plans.

Although we have generally entered into employment offer letters with our key personnel, these agreements have no specific duration and provide for at-will employment, which means our key personnel may terminate their employment relationship with us at any time.

Compensation packages for highly skilled personnel has increased over time and will likely continue to increase, and competition for highly skilled employees is often intense, especially in the San Francisco Bay Area where we are located, and we may incur significant costs to attract and retain them.

We may not be successful in attracting, integrating, or retaining qualified personnel to fulfill our current or future needs.

We have, from time to time, experienced, and we expect to continue to experience, difficulty in hiring and retaining highly skilled employees with appropriate qualifications.

In addition, job candidates and existing employees often consider the value of the equity awards they receive in connection with their employment.

If the perceived value of our equity or equity awards declines, it may adversely affect our ability to retain highly skilled employees.

If we fail to attract new personnel or fail to retain and motivate our current personnel, our business, operating results, financial condition and future growth prospects could be harmed.

We have identified certain material weaknesses in our internal control over financial reporting.

If we are unable to remediate these material weaknesses, or if we identify additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls, we may not be able to accurately or timely report our financial condition or results of operations, which may adversely affect our business and stock price.

In connection with the preparation and audit of our financial statements for the year ended December 31, 2020, certain material weaknesses were identified in our internal control over financial reporting.

These material weaknesses had not been remediated as of December 31, 2021.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

The material weaknesses identified are as follows:

• We did not design and maintain an effective control environment commensurate with our financial reporting requirements.

We lacked a sufficient number of trained professionals with (i) an appropriate level of accounting knowledge, training and experience to appropriately analyze, record and disclose accounting matters timely and accurately, and (ii) an appropriate level of knowledge and experience to establish effective processes and controls.

Additionally, the limited personnel resulted in an inability to consistently establish appropriate authorities and responsibilities in pursuit of financial reporting objectives, as demonstrated by, among other things, insufficient segregation of duties in our finance and accounting functions.

This material weakness in the control environment contributed to the other material weaknesses discussed below.

• We did not design and maintain an effective risk assessment process at a precise enough level to identify new and evolving risks of material misstatement in our financial statements.

Specifically, changes to existing controls or the implementation of new controls have not been sufficient to respond to changes to the risks of material misstatement to financial reporting.

• We did not design and maintain formal accounting policies, procedures and controls to achieve complete, accurate and timely financial accounting, reporting and disclosures, including controls over the preparation and review of business performance reviews, account reconciliations and journal entries.

• We did not design and maintain effective controls over information technology (“IT”) general controls for information systems that are relevant to the preparation of our financial statements.

Specifically, we did not design and maintain:

• user access controls to ensure appropriate segregation of duties and that adequately restrict user and privileged access to financial applications, programs, and data to appropriate company personnel;

• program change management controls to ensure that IT program and data changes affecting financial IT applications and underlying accounting records are identified, tested, authorized, and implemented appropriately;

• computer operations controls to ensure that data backups are authorized and monitored.

These material weaknesses resulted in immaterial audit adjustments to the research and development expense and property and equipment line items in our financial statements and related disclosures for the years ended December 31, 2020 and 2019, the general and administrative expense line item and within current liabilities in our consolidated financial statements and related disclosures for the year ended December 31, 2021, and a revision to our consolidated condensed financial statements for the period ended March 31, 2021 to reclassify certain costs within operating expenses from research and development expense to other warrant expense.

Additionally, each of these material weaknesses could result in a misstatement of substantially all of our accounts or disclosures that would result in a material misstatement to the annual or interim financial statements that would not be prevented or detected.

We have begun our work to remediate these material weaknesses.

Those remediation measures are ongoing and include the following:

Hiring additional accounting and IT personnel during 2021, including a new chief financial officer and other accounting personnel

to bolster its accounting and IT capabilities and capacity, and to establish and maintain Archer’s internal controls;

Designing and implementing controls to formalize roles and review responsibilities to align with Archer’s team’s

skills and experience and designing and implementing formal controls over segregation of duties;

Designing and implementing a formal risk assessment process to identify and evaluate changes in Archer’s business and

the impact on its internal controls;

Designing and implementing formal processes, policies and procedures supporting Archer’s financial close process, including

completion of business performance reviews and creation of standard balance sheet reconciliation templates and journal entry controls;

Designing and implementing IT general controls, including controls over the review and update of user access rights and privileges,

change management processes and procedures, and data backup authorization and monitoring.

While Archer believes these efforts will

remediate the material weaknesses, Archer may not be able to complete its evaluation, testing or any required remediation in a

timely fashion, or at all.

Archer cannot assure you that the measures it has taken to date and may take in the future, will be

sufficient to remediate the control deficiencies that led to its material weaknesses in internal control over financial reporting

or that they will prevent or avoid potential future material weaknesses.

The effectiveness of Archer’s internal control over

financial reporting is subject to various inherent limitations, including cost limitations, judgments used in decision making,

assumptions about the likelihood of future events, the possibility of human error and the risk of fraud.

Any failure to design

or maintain effective internal controls over financial reporting or any difficulties encountered in their implementation or improvement

could increase compliance costs, negatively impact share trading prices, or otherwise harm Archer’s operating results or

cause it to fail to meet its reporting obligations.

For the year ended December 31, 2020, Archer’s independent

registered public accounting firm has included an explanatory paragraph relating to Archer’s ability to continue as a going

concern in its report on Archer’s audited financial statements included in the Archer Disclosure Statement.

Archer’s report from their independent

registered public accounting firm for the year ended December 31, 2020 includes an explanatory paragraph stating that Archer’s

recurring losses from operations and cash outflows from operating activities raise substantial doubt about Archer’s ability

to continue as a going concern.

Archer’s consolidated financial statements do not include any adjustments that may result

from the outcome of this uncertainty and do not reflect the transactions contemplated by the Business Combination.

If the Business

Combination is not consummated and Archer is not able to obtain sufficient funding, its business, prospects, financial condition

and results of operations will be harmed and Archer may be unable to continue as a going concern.

If Archer is unable to continue

as a going concern, it may have to liquidate its assets and may receive less than the value at which those assets are carried on

its audited financial statements, and it is likely that investors would lose part or all of their investment.

Future reports from

Archer’s independent registered public accounting firm may also contain statements expressing substantial doubt about its

ability to continue as a going concern.

If there remains substantial doubt about Archer’s ability to continue as a going

concern, investors or other financing sources may be unwilling to provide additional funding to Archer on commercially reasonable

terms, or at all, and Archer’s business may be harmed.

If Archer experiences harm to its reputation and brand,

Archer’s business, financial condition and results of operations could be adversely affected.

Continuing to increase the strength of

its reputation and brand for high-performing, sustainable, safe and cost-effective urban air mobility is critical to Archer’s

ability to attract and retain customers and partners.

In addition, Archer’s growth strategy includes international expansion

through joint ventures, minority investments or other partnerships with local companies as well as event activations and cross-marketing

with other established brands, all of which benefit from Archer’s reputation and brand recognition.

The successful development

of Archer’s reputation and brand will depend on a number of factors, many of which are outside its control.

Negative perception

of Archer’s platform or company may harm its reputation and brand, including as a result of:

complaints or negative publicity or reviews about Archer, independent third-party aircraft operators fliers, its air mobility

services or other brands or events Archer associate with, even if factually incorrect or based on isolated incidents;

changes to Archer’s operations, safety and security, privacy or other policies that users or others perceive as overly

restrictive, unclear or inconsistent with Archer’s values;

illegal, negligent, reckless or otherwise inappropriate behavior by fliers, independent or other third parties involved in

the operation of Archer’s business or by Archer’s management team or other employees;

actual or perceived disruptions or defects in Archer’s flight control software or aerial ride sharing platform, such

as data security incidents, platform outages, payment processing disruptions or other incidents that impact the availability, reliability

or security of Archer’s offerings;

litigation over, or investigations by regulators into, Archer’s operations or those of Archer’s independent third-party

aircraft operators;

a failure to operate Archer’s business in a way that is consistent with its values;

negative responses by independent third-party aircraft operators or fliers to new mobility offerings;

perception of Archer’s treatment of employees, contractors or independent third-party aircraft operators and Archer’s

response to their sentiment related to political or social causes or actions of management;

any of the foregoing with respect to Archer’s competitors, to the extent such resulting negative perception affects the

public’s perception of Archer or its industry as a whole.

In addition, changes Archer may make

to enhance and improve its offerings and balance the needs and interests of its independent third-party aircraft operators

and fliers may be viewed positively from one group’s perspective (such as fliers) but negatively from another’s

perspective (such as independent third-party aircraft operators), or may not be viewed positively by either independent

third-party aircraft operators or fliers.

If Archer fails to balance the interests of independent third-party aircraft

operators and fliers or make changes that they view negatively, independent third-party aircraft operators and fliers may

stop purchasing Archer’s aircraft or stop using Archer’s platform or take fewer flights, any of which could

adversely affect Archer’s reputation, brand, business, financial condition and results of operations.

The markets for Archer’s offerings are still in

relatively early stages of growth, and if such markets do not continue to grow, grow more slowly than Archer expects or fail to

grow as large as it expects, Archer’s business, financial condition and results of operations could be harmed.

The markets for Archer’s eVTOL aircraft

are still in relatively early stages of growth, and Archer’s success in these markets is dependent upon its ability to effectively

market and sell air urban air mobility as a substitute for conventional methods of transportation and the effectiveness of its

other marketing and growth strategies.

If the public does not perceive urban air mobility as beneficial, or chooses not to adopt

urban air mobility as a result of concerns regarding safety, affordability or for other reasons, then the market for Archer’s

offerings may not further develop, may develop more slowly than Archer expects or may not achieve the growth potential it expects,

any of which could harm Archer’s business, financial condition and results of operations.

Growth of Archer’s business will

require significant investments in its Vertiport infrastructure, technology and marketing and sales efforts.

If Archer’s

business does not generate the level of available cash flow required to support these investments, Archer’s results of operations

will be negatively affected.

Further, Archer’s ability to effectively manage growth and expansion of its operations will

also require Archer to enhance its operational systems, internal controls and infrastructure, human resources policies and reporting

• Hiring additional finance, accounting, and IT personnel during 2021, including a new chief financial officer, chief information officer and other finance, accounting, and IT personnel to bolster our finance, accounting, and IT capabilities and capacity, and to establish and maintain our internal controls;

• Designing and implementing controls to formalize roles and review responsibilities to align with our team’s skills and experience and designing and implementing formal controls over segregation of duties;

• Designing and implementing a formal risk assessment process to identify and evaluate changes in our business and the impact on our internal controls;

• Designing and implementing formal processes, policies and procedures supporting our financial close process, including completion of business performance reviews and creation of standard balance sheet reconciliation templates and journal entry controls;

• Designing and implementing IT general controls, including controls over the review and update of user access rights and privileges, change management processes and procedures, and data backup authorization and monitoring.

While we believe these efforts will remediate the material weaknesses, we may not be able to complete our evaluation, testing or any necessary remediations in a timely fashion, or at all.

We cannot assure you that the measures we have taken to date and may take in the future, will be sufficient to remediate the control deficiencies that led to our material weaknesses in internal control over financial reporting or that they will prevent or avoid potential future material weaknesses.

The effectiveness of our internal control over financial reporting is subject to various inherent limitations, including cost limitations, judgments used in decision making, assumptions about the likelihood of future events, the possibility of human error and the risk of fraud.

Any failure to design or maintain effective internal controls over financial reporting or any difficulties encountered in their implementation or improvement could increase compliance costs, negatively impact share trading prices, or otherwise harm our operating results or cause us to fail to meet our reporting obligations.

If we experience harm to our reputation and brand, our business, financial condition and results of operations could be adversely affected.

Continuing to increase the strength of our reputation and brand for achieving our business plans is critical to our ability to attract and retain employees, customers, and other business partners.

In addition, our growth strategy may include expansion through joint ventures, minority investments or other partnerships with strategic business partners, which may include event activations and cross-marketing with other established brands, all of which may be dependent on our ability to build our reputation and brand recognition.

The successful development of our reputation and brand will depend on a number of factors,

many of which are outside our control.

Negative perception of our platform or company may harm our reputation and brand, including as a result of:

• complaints or negative publicity or reviews about our aircraft or service offerings from either our Archer UAM or Archer Direct customers or negative publicity reviews about other brands or events we are associated with, even if factually incorrect or based on isolated incidents;

• changes to our operations, safety and security, privacy or other policies that users or others perceive as overly restrictive, unclear or inconsistent with our values;

• illegal, negligent, reckless or otherwise inappropriate behavior by our management team or other employees, our Archer Direct customers, our Archer UAM customers or our other business partners;

• actual or perceived disruptions or defects in our aircraft or aerial ride sharing platform, such as data security incidents, platform outages, payment processing disruptions or other incidents that impact the availability, reliability or security of our offerings;

• litigation over, or investigations by regulators into, our aircraft or our operations or those of our Archer Direct customers or other business partners;

• a failure to operate our business in a way that is consistent with our values;

• negative responses by our Archer Direct or Archer UAM customers to urban air mobility offerings;

• perception of our treatment of employees, contractors, Archer Direct or Archer UAM customers or our other business partners and our response to their sentiment related to political or social causes or actions of management;

• any of the foregoing with respect to our competitors, to the extent such resulting negative perception affects the public’s perception of us or our industry as a whole.

In addition, changes we may make to enhance and improve our offerings and balance the needs and interests of our Archer Direct and Archer UAM customers may be viewed positively from one group’s perspective (such as our Archer UAM customers) but negatively from another’s perspective (such as third-party companies that purchase and operate our aircraft), or may not be viewed positively by either our Archer Direct or Archer UAM customers.

If we fail to balance the interests of these two different customer bases or make changes that they view negatively, our customers may stop purchasing our aircraft or stop using our Archer UAM service or take fewer flights, any of which could adversely affect our reputation, brand, business, financial condition and results of operations.

The markets for our offerings are still in development, and if such markets do not materialize, or grow more slowly than we expect or fail to grow as large as we expect, our business, financial condition and results of operations could be harmed.

The markets for eVTOL aircraft are still in development, and our success in these markets is dependent upon our ability to effectively design, develop, and certify eVTOL aircraft, market and gain traction of air urban air mobility as a substitute for existing methods of transportation and the effectiveness of our other marketing and growth strategies.

If the public does not perceive urban air mobility as beneficial, or chooses not to adopt urban air mobility as a result of concerns regarding safety, affordability or for other reasons, then the market for our offerings may not materialize, may develop more slowly than we expect or may not achieve the growth potential we expect, any of which could harm our business, financial condition and results of operations.

Growth of our business will require significant investments in our infrastructure, technology, and marketing and sales efforts.

If our business does not have sufficient capital required to support these investments, our results of operations will be negatively affected.

Further, our ability to effectively manage growth and expansion of our operations will also require us to enhance our operational systems, internal controls and infrastructure, human resources policies and reporting systems.

These enhancements will require significant capital expenditures and allocation of valuable management and employee resources.

The electric vertical take-off and landing (“

eVTOL ”)

aircraft industry may not continue to develop, eVTOL aircraft may not be adopted by the market or Archer’s independent third-party

aircraft operators, eVTOL aircraft may not be certified by transportation authorities or eVTOL aircraft may not deliver the expected

reduction in operating costs, any of which could adversely affect Archer’s prospects, business, financial condition and results

of operations.

eVTOL aircraft

involve a complex set of technologies, which Archer must continue to further develop and rely on its independent third-party

aircraft operators to adopt.

However, before eVTOL aircraft can fly passengers, Archer must receive requisite approvals from

federal transportation authorities.

No eVTOL aircraft are currently certified by the FAA for commercial operations in the

United States, and there is no assurance that Archer’s research and development will result in government-certified

aircraft that are market-viable or commercially successful in a timely manner or at all.

In order to gain government

certification, the performance, reliability and safety of eVTOL aircraft must be proven, none of which can be assured.

if eVTOL aircraft are certified, individual operators must conform eVTOL aircraft to their licenses, which requires FAA

approval, and individual pilots also must be licensed and approved by the FAA to fly eVTOL aircraft, which could contribute

to delays in any widespread use of eVTOL aircraft and potentially limit the number of eVTOL aircraft operators available to

partner with Archer.

Additional challenges to the adoption of

eVTOL aircraft, all of which are outside of Archer’s control, include:

The eVTOL aircraft industry may not continue to develop, eVTOL aircraft may not be adopted by the market, eVTOL aircraft may not be certified by government authorities or eVTOL aircraft may not be an attractive alternative to existing

modes of transportation, any of which could adversely affect our prospects, business, financial condition and results of operations.

eVTOL aircraft involve a complex set of technologies, which we must continue to further develop and rely on our Archer Direct and Archer UAM customers to adopt.

However, before eVTOL aircraft can fly passengers, we must receive requisite certifications and approvals from governmental authorities.

There are currently no eVTOL aircraft certified by the FAA for commercial operations in the United States, and there is no assurance that our design, development and certification efforts will result in our receiving FAA certification of our aircraft.

In order to achieve FAA certification, the performance, reliability and safety of eVTOL aircraft must be established, none of which can be assured.

In particular, there is a risk that we will not obtain one or more certifications from the FAA that are required for ultimate commercial use of our aircraft, or will experience delays in receiving one or more of these certifications.

Even if our eVTOL aircraft receive Type certification, Production certification, and Airworthiness certification, eVTOL aircraft operators must conform eVTOL aircraft to their operational licenses, which requires FAA approval, and individual pilots also must be licensed and approved by the FAA to fly eVTOL aircraft, which could contribute to delays in any widespread use of eVTOL aircraft and potentially limit the number of eVTOL aircraft operators available to purchase aircraft from or partner with us.

Additional challenges to the adoption of our eVTOL aircraft and UAM network, all of which are outside of our control, include:

• market acceptance of eVTOL aircraft;

state, federal or municipal licensing requirements and other regulatory measures;

necessary changes to Vertiport infrastructure to enable adoption, including installation of necessary charging equipment;

• state, federal or municipal regulatory and licensing requirements for our eVTOL aircraft and UAM network operations;

• necessary changes to existing infrastructure to enable adoption, including installation of necessary charging and other equipment;

• public perception regarding the safety of eVTOL aircraft.

There are a number of existing laws, regulations

and standards that may apply to eVTOL aircraft, including standards that were not originally intended to apply to electric aircraft.

Regulatory changes that address eVTOL aircraft more specifically could delay the ability of Archer to receive type certification

by transportation authorities and thus delay Archer’s independent third-party aircraft operators’

ability to utilize

eVTOL aircraft for their flights.

In addition, there can be no assurance that the market will accept eVTOL aircraft, that Archer

will be able to execute on its business strategy, or that Archer’s offerings utilizing eVTOL aircraft will obtain the necessary

government operating authority or be successful in the market.

There may be heightened public skepticism of this nascent technology

and its adopters.

In particular, there could be negative public perception surrounding eVTOL aircraft, including the overall safety

and the potential for injuries or death occurring as a result of accidents involving eVTOL aircraft, regardless of whether any

such safety incidents occur involving Archer.

Any of the foregoing risks and challenges could adversely affect Archer’s

prospects, business, financial condition and results of operations.

Archer may be unable to manage its future growth effectively,

which could make it difficult to execute Archer’s business strategy.

If Archer’s operations continue to

grow as planned, of which there can be no assurance, Archer will need to expand its sales, marketing, operations, and the number

of partners with whom Archer do business.

Archer’s continued growth could increase the strain on its resources, and it could

experience operating difficulties, including difficulties in hiring, training and managing an increasing number of employees.

difficulties may result in the erosion of Archer’s brand image, divert the attention of management and key employees and

impact financial and operational results.

The continued expansion of Archer’s business may also require additional space

for administrative support.

If Archer is unable to drive commensurate growth, these costs, which include lease commitments, marketing

costs and headcount, could result in decreased margins, which could have an adverse effect on Archer’s business, financial

condition and results of operations.

There are a number of existing laws, regulations and standards that may apply to eVTOL aircraft, including standards that were not originally intended to apply to electric aircraft.

The promulgation of additional federal, state, and local laws and regulations that address eVTOL aircraft more specifically could delay our ability to commercially launch our eVTOL aircraft and UAM network.

For example, on March 7, 2022, the DOT's Office of Inspector General (the “OIG”) issued a memorandum announcing that it plans to conduct an audit of the FAA's certification process for eVTOL aircraft.

The audit, which is expected to start in March 2022, is being commenced at the request of the Ranking Members of the House Committee on Transportation and Infrastructure and its Subcommittee on Aviation.

In its statement, the OIG highlighted the challenges surrounding the certification of eVTOL aircraft using existing FAA Regulations.

If the DOT, through its OIG, determines that the FAA should modify existing regulations or adopt new regulations relating to the certification of eVTOL aircraft, our efforts to achieve FAA type certification of our eVTOL aircraft could be significantly delayed while such regulations are being modified or adopted.

In addition, depending on the nature of any revised regulations, we may need to modify our approach to certification, it may be difficult for us to timely comply with such regulations, and we may not be able to timely achieve FAA type certification for our aircraft.

Further, we have designed our aircraft to be certified under the current FAA regulatory framework.

If the applicable FAA regulations are substantially changed or new regulations are adopted, we may need to modify the design of our aircraft to comply with the new regulations, which could cause us to incur significant expenses and scheduling delays in commercializing our aircraft and launching UAM services, which could adversely affect our prospects, business, financial condition and results of operations.

In addition, there can be no assurance that the market will accept eVTOL aircraft, that we will be able to execute on our business strategy, or that our offerings utilizing eVTOL aircraft will obtain the necessary government approvals or be successful in the market.

There may be heightened public skepticism of this nascent technology and its adopters.

In particular, there could be negative public perception surrounding eVTOL aircraft, including the overall safety and the potential for injuries or death occurring as a result of accidents involving eVTOL aircraft, regardless of whether any such safety incidents occur involving us.

Any of the foregoing risks and challenges could adversely affect our prospects, business, financial condition and results of operations.

Our ability to effectively compete and generate revenue from our products and services depends upon our ability to distinguish our products and services from our competitors and their products and services.

Our ability to compete effectively is dependent on many factors, including, without limitation, the following:

• speed to market of our initial aircraft and UAM services;

• effective strategy and execution of aircraft and service launches;

• product and service safety and performance;

• product and service pricing;

• quality of customer support.

We will have to demonstrate to potential customers that our products and services are attractive alternatives to other transportation offerings, by differentiating our products and services on the basis of such factors as innovation, performance, brand name, service, and price.

This is difficult to do, especially in a competitive market.

Some of our competitors may have more established customer relationships than we do, which could inhibit our market penetration efforts.

If we are unable to compete effectively, our revenue and profitability will be adversely impacted.

We may be unable to manage our future growth effectively, which could make it difficult to execute our business strategy.

If our business grows as planned, of which there can be no assurance, we will need to expand our sales, marketing, operations, and the number of partners with whom we do business.

Our continued growth could increase the strain on our resources, and we could experience operating difficulties, including difficulties in hiring, training and managing an increasing number of employees.

These difficulties may result in the erosion of our brand image, divert the attention of management and key employees and impact financial and operational results.

The continued expansion of our business may also require additional office space for administrative support.

If we are unable to drive commensurate growth, these costs, which include lease commitments, marketing costs and headcount, could result in decreased margins, which could have an adverse effect on our business, financial condition and results of operations.

Operation of aircraft involves a degree of inherent risk.

Archer could suffer losses and adverse publicity stemming from any accident involving small aircraft, helicopters or charter flights

and in particular from any accident involving its independent third-party aircraft operators.

The operation of aircraft is subject to

various risks, and demand for air transportation, including Archer’s urban air mobility offerings, has and may in the future

be impacted by accidents or other safety issues regardless of whether such accidents or issues involve Archer flights, its independent

third-party aircraft operators or aircraft flown by Archer’s independent third-party aircraft operators.

Air transportation

hazards, such as adverse weather conditions and fire and mechanical failures, may result in death or injury to personnel and passengers

and which could impact client or passenger confidence in a particular aircraft type or the air transportation services industry

as a whole and could lead to a reduction in passenger volume, particularly if such accidents or disasters were due to a safety

Safety statistics for air travel are reported by multiple parties, including the Department of Transportation (DOT) and

National Transportation Safety Board (NTSB), and are often separated into categories of transportation.

Because Archer’s

urban air mobility offerings may include a variety of transportation methods, fliers may have a hard time determining how safe

urban air mobility services are and their confidence in urban air mobility may be impacted by, among other things, the classification

of accidents in ways that reflect poorly on urban air mobility services or the transportation methods urban air mobility services

Archer believes that safety and

reliability are two of the primary attributes fliers consider when selecting air transportation services.

Archer’s

failure to maintain standards of safety and reliability that are satisfactory to fliers may adversely impact its ability to

retain current customers and attract new customers.

Archer is at risk of adverse publicity stemming from any public incident

involving Archer, our people or our brand.

Such an incident could involve the actual or alleged behavior of any of

Archer’s employees or independent third-party aircraft operators.

Further, if Archer’s personnel, one of its

independent third-party aircraft operators’

aircraft, one of Archer’s independent third-party aircraft

operators’

Archer-branded aircraft, or a type of aircraft in Archer’s independent third-party aircraft

operators’

fleet that is used by Archer is involved in a public incident, accident, catastrophe or regulatory

enforcement action, Archer could be exposed to significant reputational harm and potential legal liability.

The insurance

Archer carries may be inapplicable or inadequate to cover any such incident, accident, catastrophe or action.

that Archer’s insurance is inapplicable or inadequate, Archer may be forced to bear substantial losses from an incident

In addition, any such incident, accident, catastrophe or action involving Archer’s employees, one of the

Archer-branded aircraft used by Archer belonging to Archer’s independent third-party aircraft operators’

(or personnel and aircraft of Archer’s independent third-party aircraft operators), or the same type of aircraft could

create an adverse public perception, which could harm Archer’s reputation, result in air travelers being reluctant to

use Archer’s services, and adversely impact Archer’s business, results of operations and financial condition.

one or more of Archer’s independent third-party aircraft operators were to suffer an accident or lose the ability to

fly certain aircraft due to safety concerns or investigations, Archer may be required to cancel or delay certain flights

until replacement aircraft and personnel are obtained.

Archer’s operations may also be negatively

impacted by accidents or other safety-related events or investigations that occur in or near the airports and heliports Archer

plans to utilize for Archer’s urban air mobility services.

For example, if an accident were to occur at a heliport Archer

relies on for certain flights in the future (assuming Archer is granted government operating authority to do so), Archer may be

unable to fly into or out of that heliport until the accident has been cleared, any damage to the facilities have been repaired

and any insurance, regulatory or other investigations have be completed.

Additionally, the battery packs in Archer’s

aircraft are expected to use lithium-ion cells.

On rare occasions, lithium-ion cells can rapidly release the energy they contain

by venting smoke and flames in a manner that can ignite nearby materials as well as other lithium-ion cells.

While Archer has taken

measures to enhance the safety of its battery designs, a field or testing failure of its aircraft could occur in the future, which

could subject Archer to lawsuits, product recalls, or redesign efforts, all of which would be time-consuming and expensive.

negative public perceptions regarding the suitability of lithium-ion cells for aerospace applications or any future incident involving

lithium-ion cells such as an aircraft or other fire, even if such incident does not involve Archer’s aircraft, could seriously

harm its business.

From time to time Archer is expected to

store varying amounts of lithium-ion cells at its facilities.

In addition, Archer’s manufacturing partners and suppliers

are expected to store a significant number of lithium-ion cells at their facilities.

Any mishandling of battery cells may cause

disruption to the operation of our facilities or our manufacturers’.

A safety issue or fire related to the cells could disrupt

operations or cause manufacturing delays.

We could suffer losses and adverse publicity stemming from any accident involving small aircraft, helicopters or charter flights and in particular from any accident involving eVTOL aircraft.

The operation of aircraft is subject to various risks, and demand for air transportation, including our urban air mobility offerings, has and may in the future be impacted by accidents or other safety issues regardless of whether such accidents or issues involve our eVTOL aircraft or third-party eVTOL aircraft.

Air transportation hazards, such as adverse weather conditions and fire and mechanical failures, may result in death or injury to personnel and passengers, which could impact client or passenger confidence in a particular aircraft type or the air transportation services industry as a whole and could lead to a reduction in passenger volume, particularly if such accidents or disasters were due to a safety fault.

Safety statistics for air travel are reported by multiple parties, including the DOT and National Transportation Safety Board, and are often separated into categories of transportation.

Because our urban air mobility offerings may include a variety of transportation methods, fliers may have a hard time determining how safe urban air mobility services are and their confidence in urban air mobility may be impacted by, among other things, the classification of accidents in ways that reflect poorly on urban air mobility services or the transportation methods urban air mobility services utilize.

We believe that safety and reliability are two of the primary attributes fliers consider when selecting air transportation services.

Our failure to maintain standards of safety and reliability that are satisfactory to fliers may adversely impact our ability to attract and retain customers.

We are at risk of adverse publicity stemming from any public incident involving us, our people or our brand.

Such an incident could involve the actual or alleged behavior of our employees, contractors, or partners.

Further, if our eVTOL aircraft, whether operated by us or a third party, is involved in a public incident, accident, catastrophe or regulatory enforcement action, we could be exposed to significant reputational harm and potential legal liability.

The insurance we carry may be inapplicable or inadequate to cover any such incident, accident, catastrophe or action.

In the event that our insurance is inapplicable or inadequate, we may be forced to bear substantial losses from an incident or accident.

In addition, any such incident, accident, catastrophe or action involving our eVTOL aircraft or eVTOL aircraft generally could create an adverse public perception, which could harm our reputation, result in air travelers being reluctant to use our services, and adversely impact our business, results of operations and financial condition.

If we or one of our third-party aircraft operators were to suffer an accident or lose the ability to fly certain aircraft due to safety concerns or investigations, we or such operators may be required to cancel or delay certain flights until replacement aircraft and personnel are obtained.

Our operations may also be negatively impacted by accidents or other safety-related events or investigations that occur in or near the airports and vertiports we plan to utilize for our urban air mobility services.

For example, if an accident were to occur at a vertiport we rely on for certain flights in the future (assuming we are granted government operating authority to do

so), we may be unable to fly into or out of that vertiport until the accident has been cleared, any damage to the facilities have been repaired and any insurance, regulatory or other investigations have been completed.

Additionally, the battery packs in our aircraft are expected to use lithium-ion cells.

On rare occasions, lithium-ion cells can rapidly release the energy they contain by venting smoke and flames in a manner that can ignite nearby materials as well as other lithium-ion cells.

While we have taken measures to enhance the safety of our battery designs, a field or testing failure of our aircraft could occur in the future, which could subject us to lawsuits, product recalls, or redesign efforts, all of which would be time-consuming and expensive.

Also, negative public perceptions regarding the suitability of lithium-ion cells for aerospace applications or any future incident involving lithium-ion cells such as an aircraft or other fire, even if such incident does not involve our aircraft, could seriously harm our business.

From time to time we are expected to store varying amounts of lithium-ion cells at our facilities.

In addition, our manufacturing partners and suppliers are expected to store a significant number of lithium-ion cells at their facilities.

Any mishandling of battery cells may cause disruption to the operation of our facilities or our manufacturers.

A safety issue or fire related to the cells could disrupt operations or cause manufacturing delays.

Such damage or injury could lead to adverse publicity and potentially a safety recall.

Moreover, any failure of a competitor’s eVTOL aircraft or energy storage product may cause indirect adverse publicity for

Archer and its aircraft.

Such adverse publicity could negatively affect Archer’s brand and harm its business, prospects,

financial condition and operating results.

Archer is highly dependent on Archer’s senior management

team and other highly skilled personnel, and if Archer is not successful in attracting or retaining highly qualified personnel,

it may not be able to successfully implement Archer’s business strategy.

Archer’s success depends, in significant

part, on the continued services of its senior management team and on Archer’s ability to attract, motivate, develop and retain

a sufficient number of other highly skilled personnel, including finance, marketing, sales, and technology and support personnel.

Archer believes that the breadth and depth of its senior management team’s experience across multiple industries will be

instrumental to our success.

The loss of any one or more members of Archer’s senior management team, for any reason, including

resignation or retirement, could impair Archer’s ability to execute its business strategy and harm Archer’s business,

financial condition and results of operations.

Additionally, Archer’s financial condition and results of operations may be

adversely affected if Archer is unable to attract and retain skilled employees to support Archer’s operations and growth.

Archer’s business may be adversely affected by labor

and union activities.

Although none of Archer’s employees

are currently represented by a labor union, it is common throughout the aerospace industry generally for many employees at aerospace

companies to belong to a union, which can result in higher employee costs and increased risk of work stoppages.

Archer may also

directly and indirectly depend upon other companies with unionized work forces, such as parts suppliers and trucking and freight

companies, and work stoppages or strikes organized by such unions could harm Archer’s business, financial condition or operating

Archer expects that its United Airlines purchase agreement

and that future purchase orders will be subject to indexed price escalation clauses which could subject Archer to losses if it

has cost overruns or if increases in its costs exceed the applicable escalation rate.

Commercial aircraft sales contracts

are often entered into years before the aircraft are delivered.

In order to help account for economic fluctuations between

the contract date and delivery date, aircraft pricing generally consists of a fixed amount as modified by price escalation

formulas derived from labor, commodity and other price indices.

Our revenue estimates are based on current expectations with

respect to these escalation formulas, but the actual escalation amounts are outside of our control.

Escalation factors can

fluctuate significantly from period to period and changes in escalation amounts can significantly impact revenues and

operating margins in our eVTOL business.

We can make no assurance that any customer, current or future, will exercise

purchase options, fulfill existing purchase commitments or purchase additional products or services from us.

The terms and

conditions of the United Airlines purchase agreement regarding price escalation clauses are yet to be determined, and there

is no assurance that they will be determined in a manner that will mitigate the risks described above.

Archer currently relies and will continue to rely on third-party

partners to provide and store the parts and components required to manufacture Archer’s aircraft, and to supply critical

components and systems, which exposes it to a number of risks and uncertainties outside its control.

Archer is substantially reliant on its

relationships with its suppliers and service providers for the parts and components in its aircraft.

If any of these suppliers

or service partners were to experience delays, disruptions, capacity constraints or quality control problems in its manufacturing

operations, or if they choose to not do business with Archer, Archer would have significant difficulty in procuring and producing

Archer’s aircraft, and Archer’s business prospects would be significantly harmed.

These disruptions would negatively

impact Archer’s revenues, competitive position and reputation.

In addition, Archer’s suppliers or service partners

may rely on certain state tax incentives that may be subject to change or elimination in the future, which could result in additional

costs and delays in production if a new manufacturing site must be obtained.

Further, if Archer is unable to manage successfully

its relationship with its suppliers or service partners, the quality and availability of its aircraft may be harmed.

Archer’s

suppliers or service partners could, under some circumstances, decline to accept new purchase orders from or otherwise reduce their

business with Archer.

If Archer’s suppliers or service partners stopped manufacturing Archer’s aircraft components

for any reason or reduced manufacturing capacity, Archer may be unable to replace the lost manufacturing capacity on a timely and

comparatively cost-effective basis, which would adversely impact its operations.

The manufacturing facilities of Archer’s

suppliers or service partners and the equipment used to manufacture the components for Archer’s aircraft would be costly

to replace and could require substantial lead time to replace and qualify for use.

The manufacturing facilities of Archer’s

suppliers or service partners may be harmed or rendered inoperable by natural or man-made disasters, including earthquakes, flooding,

fire and power outages, or by health epidemics, such as the recent COVID-19 pandemic, which may render it difficult or impossible

for Archer to manufacture its aircraft for some period of time.

The inability to manufacture Archer’s aircraft components

or the backlog that could develop if the manufacturing facilities of its suppliers or service partners are inoperable for even

a short period of time may result in the loss of customers or harm Archer’s reputation.

Archer does not control its suppliers or

service partners or such parties’

labor and other legal compliance practices, including their environmental, health and safety

If Archer’s current suppliers or service partners, or any other suppliers or service partners which it may use

in the future, violates U.S.

or foreign laws or regulations, Archer may be subjected to extra duties, significant monetary penalties,

adverse publicity, the seizure and forfeiture of products that Archer is attempting to import or the loss of its import privileges.

The effects of these factors could render the conduct of Archer’s business in a particular country undesirable or impractical

and have a negative impact on Archer’s operating results.

Archer has been, and may in the future be, adversely affected

by health epidemics and pandemics, including the ongoing global COVID-19 pandemic, the duration and economic, governmental and

social impact of which is difficult to predict, which may significantly harm Archer’s business, prospects, financial condition

and operating results.

Archer faces various risks related to public

health issues, including epidemics, pandemics and other outbreaks, including the recent pandemic of respiratory illness caused

by a novel coronavirus known as COVID-19.

The impact of COVID-19, including changes in consumer and business behavior, pandemic

fears and market downturns and restrictions on business and individual activities, has created significant volatility in the global

economy and led to reduced economic activity.

The spread of COVID-19 has also created a disruption in the manufacturing, delivery

and overall supply chain of aircraft manufacturers and suppliers, and has led to a global decrease in aircraft sales and usage

in markets around the world.

The duration and long-term impact of COVID-19 on Archer’s business is currently unknown.

The pandemic has resulted in government

authorities implementing numerous measures to try to contain the virus, such as travel bans and restrictions, quarantines, stay-at-home

or shelter-in-place orders, and business shutdowns.

These measures may adversely impact Archer’s employees and operations

and the operations of its suppliers, vendors and business partners, and may negatively impact its sales and marketing activities

and the production schedule of its aircraft.

In addition, various aspects of Archer’s business cannot be conducted remotely,

including the testing and manufacturing of its aircraft.

These measures by government authorities may remain in place for a significant

period of time and they are likely to continue to adversely affect Archer’s testing, manufacturing and building plans, sales

and marketing activities, business and results of operations.

The spread of COVID-19 has caused Archer

and many of its contractors and service providers to modify their business practices (including employee travel, recommending that

all non-essential personnel work from home and cancellation or reduction of physical participation in meetings, events and conferences),

and Archer and its contractors and service providers may be required to take further actions as may be required by government authorities

or that it determines are in the best interests of its employees, customers, suppliers, vendors and business partners.

no certainty that such actions will be sufficient to mitigate the risks posed by the virus or otherwise be satisfactory to government

If significant portions of Archer’s workforce or contractors and service providers are unable to work effectively,

including due to illness, quarantines, social distancing, government actions or other restrictions in connection with the COVID-19

pandemic, Archer’s operations will be impacted.

The extent to which the COVID-19 pandemic

impacts Archer’s business, prospects and results of operations will depend on future developments, which are highly uncertain

and cannot be predicted, including, but not limited to, the duration and spread of the pandemic, its severity, the actions to contain

the virus or treat its impact and how quickly and to what extent normal economic and operating activities can resume.

pandemic could limit the ability of Archer’s customers, suppliers, vendors and business partners to perform, including third-party

suppliers’

ability to provide components and materials used in its aircraft.

Archer may also experience an increase in the

cost of raw materials used in its commercial production of Archer’s aircraft.

Even after the COVID-19 pandemic has subsided,

Archer may continue to experience an adverse impact to its business as a result of COVID-19’s global economic impact, including

any recession that has occurred or may occur in the future.

There are no comparable recent events which

may provide guidance as to the effect of the spread of COVID-19 and a pandemic, and, as a result, the ultimate impact of the COVID-19

pandemic or a similar health epidemic is highly uncertain and subject to change.

Archer does not yet know the full extent of COVID-19’s

impact on its business, operations, or the global economy as a whole.

However, the effects could have a material impact on Archer’s

results of operations, and Archer will continue to monitor the situation closely.

Archer is subject to cybersecurity risks to its operational

systems, security systems, infrastructure, integrated software in its aircraft and customer data processed by Aircraft or third-party

Archer is at risk for interruptions, outages

and breaches of its:

(a) operational systems, including business, financial, accounting, product development, data processing or

production processes, owned by Archer or its third-party vendors or suppliers;

(b) facility security systems, owned by Archer or

its third-party vendors or suppliers;

by Archer or its third-party vendors or suppliers;

(d) the integrated software in Archer’s aircraft;

or (e) customer data

that Archer processes or its third-party vendors or suppliers process on its behalf.

Moreover, any failure of a competitor’s eVTOL aircraft or energy storage product may cause indirect adverse publicity for us and our aircraft.

Such adverse publicity could negatively affect our brand and harm our business, prospects, financial condition and operating results.

Our business may be adversely affected by labor and union activities.

Although none of our employees are currently represented by a labor union, it is common throughout the aerospace industry generally for many employees at aerospace companies to belong to a union, which can result in higher employee costs and increased risk of work stoppages.

We may also directly and indirectly depend upon other companies with unionized work forces, such as parts suppliers and trucking and freight companies, and work stoppages or strikes organized by such unions could harm our business, financial condition or operating results.

We expect that our Purchase Agreement with United and that future purchase agreements with other customers will be subject to indexed price escalation clauses which could subject us to losses if we have cost overruns or if increases in our costs exceed the applicable escalation rate.

Commercial aircraft sales contracts are often entered into years before the aircraft are delivered.

In order to help account for economic fluctuations between the contract date and delivery date, aircraft pricing generally consists of a fixed amount as modified by price escalation formulas derived from labor, commodity and other price indices.

Our revenue estimates are based on current expectations with respect to these escalation formulas, but the actual escalation amounts are outside of our control.

Escalation factors can fluctuate significantly from period to period and changes in escalation amounts can significantly impact revenues and operating margins in our business.

We can make no assurance that any customer, current or future, will exercise purchase options, fulfill existing purchase commitments or purchase additional products or services from us.

The terms and conditions of the Purchase Agreement with United regarding price escalation clauses are yet to be determined, and there is no assurance that they will be determined in a manner that will mitigate the risks described above.

We currently rely and will continue to rely on third-party partners to provide and store the parts and components required to manufacture our aircraft, and to supply critical components and systems, which exposes us to a number of risks and uncertainties outside our control.

We are substantially reliant on our relationships with our suppliers and service providers for the parts and components in our aircraft.

If any of these suppliers or service partners were to experience delays, disruptions, capacity constraints or quality control problems in their manufacturing operations, or if they choose to not do business with us, we would have significant difficulty in procuring and producing our aircraft, and our business prospects would be significantly harmed.

These disruptions would negatively impact our revenues, competitive position and reputation.

In addition, our suppliers or service partners may rely on certain state tax incentives that may be subject to change or elimination in the future, which could result in additional costs and delays in production if a new manufacturing site must be obtained.

Further, if we are unable to successfully manage our relationship with our suppliers or service partners, the quality and availability of our aircraft may be harmed.

Our suppliers or service partners could, under some circumstances, decline to accept new purchase orders from or otherwise reduce their business with us.

If our suppliers or service partners stopped manufacturing our aircraft components for any reason or reduced manufacturing capacity, we may be unable to replace the lost manufacturing capacity on a timely and comparatively cost-effective basis, which would adversely impact our operations.

The manufacturing facilities of our suppliers or service partners and the equipment used to manufacture the components for our aircraft would be costly to replace and could require substantial lead time to replace and qualify for use.

The manufacturing facilities of our suppliers or service partners may be harmed or rendered inoperable by natural or man-made disasters, including earthquakes, flooding, fire and power outages, or by public health issues, such as the ongoing COVID-19 pandemic, which may render it difficult or impossible for us to manufacture our aircraft for some period of time.

The inability to manufacture our aircraft components or the backlog that could develop if the manufacturing facilities of our suppliers or service partners are inoperable for even a short period of time may result in the loss of customers or harm our reputation.

We do not control our suppliers or service partners or such parties’ labor and other legal compliance practices, including their environmental, health and safety practices.

If our current suppliers or service partners, or any other suppliers or service partners which we may use in the future, violate U.S.

or foreign laws or regulations, we may be subjected to extra duties, significant monetary penalties, adverse publicity, the seizure and forfeiture of products that we are attempting to import or the loss of our import privileges.

The effects of these factors could render the conduct of our business in a particular country undesirable or impractical and have a negative impact on our operating results.

We have been, and may in the future be, adversely affected by health epidemics and pandemics, including the ongoing global COVID-19 pandemic, the duration and economic, governmental and social impact of which is difficult to predict, which may significantly harm our business, prospects, financial condition and operating results.

We face various risks related to public health issues, including epidemics, pandemics and other outbreaks, including the ongoing COVID-19 pandemic.

The impact of the COVID-19 pandemic, including changes in consumer and business behavior, pandemic fears and market downturns, supply shortages and restrictions on business and individual activities, has created significant volatility in the global economy.

The spread of COVID-19 has also created a disruption in the manufacturing, delivery and overall supply chain of aircraft manufacturers and suppliers, and has led to a global decrease in aircraft sales and usage in markets around the world.

The duration and long-term impact of the COVID-19 pandemic on our business is currently unknown.

The COVID-19 pandemic has resulted in government authorities implementing numerous measures to try to contain the virus, such as travel bans and restrictions, quarantines, stay-at-home or shelter-in-place orders, and business shutdowns.

These measures may adversely impact our employees and operations and the operations of our suppliers, vendors and business partners, and may negatively impact our sales and marketing activities and the production schedule of our aircraft.

In addition, various aspects of our business cannot be conducted remotely, including the testing and manufacturing of our aircraft.

These measures by government authorities may remain in place for a significant period of time and they are likely to continue to adversely affect our testing, manufacturing and building plans, sales and marketing activities, business and results of operations.

The spread of COVID-19 has caused us and many of our contractors and service providers to modify their business practices (including employee travel, recommending that all non-essential personnel work from home and cancellation or reduction of physical participation in meetings, events and conferences), and we and our contractors and service providers may be required to take further actions as may be required by government authorities or that we determine are in the best interests of our employees, customers, suppliers, vendors and business partners.

There is no certainty that such actions will be sufficient to mitigate the risks posed by the virus or otherwise be satisfactory to government authorities.

If significant portions of our workforce or contractors and service providers are unable to work effectively, including due to illness, quarantines, social distancing, government actions or other restrictions in connection with the COVID-19 pandemic, our operations will be impacted.

The extent to which the COVID-19 pandemic impacts our business, prospects and results of operations will depend on future developments, which are highly uncertain and cannot be predicted, including, but not limited to, the duration and spread of the pandemic, its severity, the actions to contain the virus and its variants or treat its impact and how quickly and to what extent normal economic and operating activities can resume.

The COVID-19 pandemic could limit the ability of our customers, suppliers, vendors and business partners to perform, including third-party suppliers’ ability to provide components and materials used in our aircraft.

We may also experience an increase in the cost of raw materials used in our commercial production of our aircraft.

Even after the COVID-19 pandemic has subsided, we may continue to experience an adverse impact to our business as a result of COVID-19’s global economic impact, including ongoing supply chain shortages.

There are no comparable recent events which may provide guidance as to the effect of the COVID-19 pandemic, and, as a result, the ultimate impact of the COVID-19 pandemic or other health pandemics or epidemics is highly uncertain and subject to change.

We do not yet know the full extent of the impact of the COVID-19 pandemic on our business, operations, or the global economy as a whole.

However, the effects could have a material impact on our results of operations, and we will continue to monitor the situation closely.

Our long-term success and ability to significantly grow our revenue will depend, in part, on our ability to establish and expand into international markets and/or expand market segments.

Our future results will depend, in part, on our ability to establish and expand our presence within international markets and may also depend on our expansion into additional market segments, such as defense or logistics/cargo.

Our ability to expand into these markets will depend upon our ability to obtain the necessary international governmental certifications and regulatory approvals, adapt to international markets and new market segments, understand the local customer base, and address any unique local technological requirements.

Our ability to expand internationally involves various risks, including, but not limited to, the need to invest significant resources in such expansion, and the possibility that returns on such investments will not be achieved in the near future or at all in these less familiar competitive environments.

We may also choose to conduct our international business through joint ventures, minority investments or other partnerships with local companies as well as co-marketing with other established brands.

If we are unable to identify partners or negotiate favorable terms, our international growth may be limited.

In addition, we may incur significant expenses in advance of generating material revenue as we attempt to establish our presence in particular international markets or market segments outside of aircraft sales and operating a UAM network to carry passengers.

Failure to comply with applicable laws and regulations relating to the aviation business in general and eVTOL aircraft specifically, could adversely affect our business and our financial condition.

Our eVTOL aircraft and the operation of our UAM services will be subject to substantial regulation in the jurisdictions in which we intend our eVTOL aircraft to operate.

We expect to incur significant costs in complying with these regulations.

Regulations related to the eVTOL industry, including aircraft certification, production certification, passenger operation, flight operation, airspace operation, security regulation and vertiport regulation are currently evolving, and we face risks associated with the development and evolution of these regulations.

Our aircraft must be certified with the FAA in the United States.

Operating our aircraft in the U.S.

and providing our passenger transportation services must comply with U.S.

laws, regulations, safety standards, and customer service regulations.

Rigorous testing and the use of approved materials and equipment are among the requirements for achieving certification.

Our failure to obtain or maintain certification for our aircraft or infrastructure would have a material adverse effect on our business and operating results.

In addition to obtaining and maintaining certification of our aircraft, we will need to obtain and maintain operational authority necessary to provide our envisioned UAM services.

A transportation or aviation authority may determine that we cannot manufacture, provide, or otherwise engage in those services as we have contemplated.

The inability to implement our envisioned services could materially and adversely affect our results of operations, financial condition, and prospects.

To the extent the laws change, our aircraft and our services may not comply with those laws, which would have an adverse effect on our business.

Complying with changing laws could be burdensome, time consuming, and expensive.

To the extent compliance with new laws is cost prohibitive, our business, prospects, financial condition and operating results would be adversely affected.

When we expand beyond the United States, such as into Europe, there will be European laws and regulations we must comply with, and there may be laws and regulations in other jurisdictions we have not yet entered or laws we are unaware of in jurisdictions we have entered that may restrict our operations or business practices or that are difficult to interpret and change rapidly.

Continued regulatory limitations and other obstacles interfering with our business operations could have a negative and material impact on our business, prospects, financial condition and results of operations.

We are subject to cybersecurity risks to our operational systems, security systems, infrastructure, integrated software in our aircraft and customer data processed by us or third-party vendors.

We are at risk for interruptions, outages and breaches of our:

(a) operational systems, including business, financial, accounting, product development, data processing or production processes, owned by us or our third-party vendors or suppliers;

(b) facility security systems, owned by us or our third-party vendors or suppliers;

(c) aircraft technology including powertrain and avionics and flight control software, owned by us or our third-party vendors or suppliers;

(d) the integrated software in our aircraft;

or (e) customer data that we process or our third-party vendors or suppliers process on our behalf.

Such incidents could:

disrupt Archer’s

operational systems;

result in loss of intellectual property, trade secrets or other proprietary or competitively sensitive information;

disrupt our operational systems;

result in loss of intellectual property, trade secrets or other proprietary or competitively

sensitive information;

compromise certain information of customers, employees, suppliers, or others;

jeopardize the security of Archer’s facilities;

or affect the performance of in-product technology and the integrated software in Archer’s aircraft.

Archer plans to include avionics and

flight control software services and functionality that utilize data connectivity to monitor aircraft performance and to

enhance safety and enable cost-saving preventative maintenance.

The availability and effectiveness of Archer’s services

depend on the continued operation of information technology and communications systems.

Archer’s systems will be

vulnerable to damage or interruption from, among others, physical theft, fire, terrorist attacks, natural disasters, power

loss, war, telecommunications failures, viruses, denial or degradation of service attacks, ransomware, social engineering

schemes, insider theft or misuse or other attempts to harm Archer’s systems.

Archer intends to use its avionics and

flight control software and functionality to log information about each aircraft’s use in order to aid Archer in

aircraft diagnostics and servicing.

Archer’s customers may object to the use of this data, which may increase

Archer’s vehicle maintenance costs and harm its business prospects.

Moreover, there are inherent risks associated

with developing, improving, expanding and updating Archer’s current systems, such as the disruption of Archer’s data

management, procurement, production execution, finance, supply chain and sales and service processes.

These risks may affect Archer’s

ability to manage its data and inventory, procure parts or supplies or manufacture, deploy, deliver and service its aircraft, adequately

protect its intellectual property or achieve and maintain compliance with, or realize available benefits under, applicable laws,

regulations and contracts.

Archer cannot be sure that these systems upon which it relies, including those of its third-party vendors

or suppliers, will be effectively implemented, maintained or expanded as planned.

If Archer does not successfully implement, maintain

or expand these systems as planned, its operations may be disrupted, its ability to accurately and timely report its financial

results could be impaired.

Moreover, Archer’s proprietary information or intellectual property could be compromised or misappropriated,

and its reputation may be adversely affected.

If these systems do not operate as Archer expects them to, Archer may be required

to expend significant resources to make corrections or find alternative sources for performing these functions.

Failure to comply with federal, state and foreign laws

and regulations relating to privacy, data protection and consumer protection, or the expansion of current laws and regulations

or the enactment of new laws or regulations in these areas, could adversely affect Archer’s business and Archer’s financial

Archer is subject to or affected by a number

of federal, state and local laws and regulations, as well as contractual obligations and industry standards, that impose certain

obligations and restrictions with respect to data privacy and security, and govern Archer’s collection, storage, retention,

protection, use, processing, transmission, sharing and disclosure of personal information including that of its employees, customers

Most jurisdictions have enacted laws requiring companies to notify individuals, regulatory authorities and others of

security breaches involving certain types of data.

jeopardize the security of our facilities;

or affect the performance of in-product technology and the integrated software in our aircraft.

We plan to include avionics and flight control software services and functionality that utilize data connectivity to monitor aircraft performance and to enhance safety and enable cost-saving preventative maintenance.

The availability and effectiveness of our services depend on the continued operation of information technology and communications systems.

Our systems will be vulnerable to damage or interruption from, among others, physical theft, fire, terrorist attacks, natural disasters, power loss, war, telecommunications failures, viruses, worms, trojan horses, denial or degradation of service attacks, ransomware, social engineering schemes, insider theft or misuse or other attempts to harm our systems.

We intend to use our avionics and flight control software and functionality to log information about each aircraft’s use in order to aid us in aircraft diagnostics and servicing.

Our customers may object to the use of this data, which may increase our vehicle maintenance costs and harm our business prospects.

Moreover, there are inherent risks associated with developing, improving, expanding and updating our current systems, such as the disruption of our data management, procurement, production execution, finance, supply chain and sales and service processes.

These risks may affect our ability to manage our data and inventory, procure parts or supplies or manufacture, deploy, deliver and service our aircraft, adequately protect our intellectual property or achieve and maintain compliance with, or realize available benefits under, applicable laws, regulations and contracts.

We cannot be sure that these systems upon which we rely, including those of our third-party vendors or suppliers, will be effectively implemented, maintained or expanded as planned.

If we do not successfully implement, maintain or expand these systems as planned, our operations may be disrupted and our ability to accurately and timely report our financial results could be impaired.

Moreover, our proprietary information or intellectual property could be compromised or misappropriated, and our reputation may be adversely affected.

If these systems do not operate as we expect them to, we may be required to expend significant resources to make corrections or find alternative sources for performing these functions.

Failure to comply with federal, state and foreign laws and regulations relating to privacy, data protection and consumer protection, or the expansion of current laws and regulations or the enactment of new laws or regulations in these areas, could adversely affect our business and our financial condition.

We are subject to or affected by a number of federal, state and local laws and regulations, as well as contractual obligations and industry standards, that impose certain obligations and restrictions with respect to data privacy and security, and govern our collection, storage, retention, protection, use, processing, transmission, sharing and disclosure of personal information including that of our employees, customers and others.

Most jurisdictions have enacted laws requiring companies to notify individuals, regulatory authorities and others of security breaches involving certain types of data.

Such laws may be inconsistent or may change or additional laws may be adopted.

In addition, Archer’s agreements with certain customers may require New Archer to notify them in the event of a security

Such mandatory disclosures are costly, could lead to negative publicity, result in penalties or fines, result in litigation,

may cause Archer’s customers to lose confidence in the effectiveness of Archer’s security measures and require New

Archer to expend significant capital and other resources to respond to and/or alleviate problems caused by the actual or perceived

security breach.

The global data protection landscape is

rapidly evolving, and implementation standards and enforcement practices are likely to remain uncertain for the foreseeable future.

Archer may not be able to monitor and react to all developments in a timely manner.

For example, California adopted the California

Consumer Privacy Act (CCPA), which became effective in January 2020.

The CCPA establishes a privacy framework for covered businesses,

including an expansive definition of personal information and data privacy rights for California residents.

The CCPA includes a

framework with potentially severe statutory damages and private rights of action.

The CCPA requires covered businesses to provide

new disclosures to California residents, provide them new ways to opt-out of certain disclosures of personal information, and allow

for a new cause of action for data breaches.

As Archer expands its operations, the CCPA may increase Archer’s compliance

costs and potential liability.

Some observers have noted that the CCPA could mark the beginning of a trend toward more stringent

privacy legislation in the United States.

In addition, our agreements with certain customers may require us to notify them in the event of a security breach.

Such mandatory disclosures are costly, could lead to negative publicity, result in penalties or fines, result in litigation, may cause our customers to lose confidence in the effectiveness of our security measures and require us to expend significant capital and other resources to respond to and/or alleviate problems caused by the actual or perceived security breach.

The global data protection landscape is rapidly evolving, and implementation standards and enforcement practices are likely to remain uncertain for the foreseeable future.

We may not be able to monitor and react to all developments in a timely manner.

For example, California adopted the California Consumer Privacy Act (the “CCPA”), which became effective in January 2020.

The CCPA establishes a privacy framework for covered businesses, including an expansive definition of personal information and data privacy rights for California residents.

The CCPA includes a framework with potentially severe statutory damages and private rights of action.

The CCPA requires covered businesses to provide new disclosures to California residents, provide them new ways to opt-out of certain disclosures of personal information, and allow for a new cause of action for data breaches.

As we expand our operations, the CCPA may increase our compliance costs and potential liability.

Some observers have noted that the CCPA could mark the beginning of a trend toward more stringent privacy legislation in the United States.

Other states have begun to propose similar laws.

Compliance with any applicable privacy

and data security laws and regulations is a rigorous and time-intensive process, and Archer may be required to put in place additional

mechanisms to comply with such laws and regulations.

Archer publishes privacy policies and other

documentation regarding its collection, processing, use and disclosure of personal information and/or other confidential information.

Although Archer endeavors to comply with its published policies and other documentation, Archer may at times fail to do so or may

be perceived to have failed to do so.

Moreover, despite its efforts, Archer may not be successful in achieving compliance if Archer’s

employees, contractors, service providers or vendors fail to comply with its published policies and documentation.

Such failures

can subject Archer to potential local, state and federal action if they are found to be deceptive, unfair, or misrepresentative

of its actual practices.

Claims that Archer has violated individuals’

privacy rights or failed to comply with data protection

laws or applicable privacy notices even if Archer is not found liable, could be expensive and time-consuming to defend and could

result in adverse publicity that could harm its business.

Archer is subject to risks associated with climate change,

including the potential increased impacts of severe weather events on our operations and infrastructure.

The potential physical effects of climate

change, such as increased frequency and severity of storms, floods, fires, fog, mist, freezing conditions, sea-level rise and other

climate-related events, could affect Archer’s operations, infrastructure and financial results.

Certain of the airports where

Archer’s terminal facilities are expected to initially be located in connection with its aerial ride sharing operations are

susceptible to the impacts of storm-related flooding and sea-level rise, which could result in costs and loss of revenue.

could incur significant costs to improve the climate resiliency of its infrastructure and otherwise prepare for, respond to, and

mitigate such physical effects of climate change.

Archer is not able to accurately predict the materiality of any potential losses

or costs associated with the physical effects of climate change.

Archer intends to retain certain personal information

about its aircraft, customers, employees or others that, if compromised, could harm Archer’s financial performance and results

of operations or prospects.

Archer is subject to a wide variety of

laws in the United States and other jurisdictions related to privacy, data protection and consumer protection that are often complex

and subject to varying interpretations.

As a result, these privacy, data protection and consumer protection laws may change or

develop over time through judicial decisions or as new guidance or interpretations are provided by regulatory and governing bodies

and such changes or developments may be contrary to Archer’s existing practices.

This may cause Archer to expend resources

on updating, changing or eliminating some of our privacy and data protection practices.

Archer plans to collect, store, transmit

and otherwise process data from aircraft, customers, employees and others as part of its business and operations, which may include

personal data or confidential or proprietary information.

Archer also works with partners and third-party service providers or

vendors that collect, store and process such data on its behalf and in connection with its aircraft.

There can be no assurance

that any security measures that Archer or its third-party service providers or vendors have implemented will be effective against

current or future security threats.

If a compromise of data were to occur, Archer may become liable under its contracts with other

parties and under applicable law for damages and incur penalties and other costs to respond to, investigate and remedy such an

Archer’s systems, networks and physical facilities could be breached, or personal information could otherwise be

compromised due to employee error or malfeasance, if, for example, third parties attempt to fraudulently induce Archer’s

employees or Archer’s customers to disclose information or user names and/or passwords.

Third parties may also exploit vulnerabilities

in, or obtain unauthorized access to, platforms, systems, networks and/or physical facilities utilized by Archer’s service

providers and vendors.

Archer’s aircraft contain complex

information technology systems and built-in data connectivity to share aircraft data with ground operations infrastructure.

plans to design, implement and test security measures intended to prevent unauthorized access to its information technology networks,

its aircraft and related systems.

However, hackers may attempt to gain unauthorized access to modify, alter and use such networks,

aircraft and systems to gain control of or to change Archer’s aircraft’s functionality, performance characteristics,

or to gain access to data stored in or generated by the aircraft.

A significant breach of Archer’s third-party service providers’

or vendors’

or its own network security and systems could have serious negative consequences for Archer’s business

and future prospects, including possible fines, penalties and damages, reduced customer demand for its aircraft or urban aerial

ride sharing services and harm to its reputation and brand.

Archer may not have adequate insurance

The successful assertion of one or more large claims against Archer that exceeds its available insurance coverage, or

results in changes to its insurance policies (including premium increases or the imposition of large deductible or co-insurance

requirements), could have an adverse effect on its business.

In addition, Archer cannot be sure that its existing insurance coverage

will continue to be available on acceptable terms or that Archer’s insurers will not deny coverage as to any future claim.

Archer will incur increased costs as a result of operating

as a public company, and its management will devote substantial time to new compliance initiatives.

If Archer completes the Business Combination

and becomes a public company, it will incur significant legal, accounting and other expenses that it did not incur as a private

company, and these expenses may increase even more after Archer is no longer an emerging growth company, as defined in Section

2(a) of the Securities Act.

As a public company, Archer will be subject to the reporting requirements of the Exchange Act, the

Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, as well as rules adopted, and to be adopted,

by the SEC and NYSE.

Archer’s management and other personnel will need to devote a substantial amount of time to these compliance

Moreover, Archer expects these rules and regulations to substantially increase its legal and financial compliance

costs and to make some activities more time-consuming and costly.

The increased costs will increase Archer’s net loss.

example, Archer expects these rules and regulations to make it more difficult and more expensive for it to obtain director and

officer liability insurance and it may be forced to accept reduced policy limits or incur substantially higher costs to maintain

the same or similar coverage.

Archer cannot predict or estimate the amount or timing of additional costs it may incur to respond

to these requirements.

The impact of these requirements could also make it more difficult for Archer to attract and retain qualified

persons to serve on its board of directors, its board committees or as executive officers.

Archer is or may be subject to risks associated with strategic

alliances or acquisitions and may not be able to identify adequate strategic relationship opportunities, or form strategic relationships,

in the future.

Archer has entered into strategic alliances,

and may in the future enter into additional strategic alliances or joint ventures or minority equity investments, in each case

with various third parties for the production of its aircraft as well as with other collaborators with capabilities on data and

analytics and engineering.

These alliances subject Archer to a number of risks, including risks associated with sharing proprietary

information, non-performance by the third-party and increased expenses in establishing new strategic alliances, any of which may

adversely affect Archer’s business.

Archer may have limited ability to monitor or control the actions of these third parties

and, to the extent any of these strategic third parties suffers negative publicity or harm to their reputation from events relating

to their business, Archer may also suffer negative publicity or harm to its reputation by virtue of its association with any such

Strategic business relationships will be

an important factor in the growth and success of Archer’s business.

However, there are no assurances that Archer will be

able to continue to identify or secure suitable business relationship opportunities in the future or Archer’s competitors

may capitalize on such opportunities before Archer does.

Moreover, identifying such opportunities could require substantial management

time and resources, and negotiating and financing relationships involves significant costs and uncertainties.

If Archer is unable

to successfully source and execute on strategic relationship opportunities in the future, its overall growth could be impaired,

and its business, prospects, financial condition and operating results could be adversely affected.

When appropriate opportunities arise, Archer

may acquire additional assets, products, technologies or businesses that are complementary to its existing business.

to possible stockholder approval, Archer may need approvals and licenses from relevant government authorities for the acquisitions

and to comply with any applicable laws and regulations, which could result in increased delay and costs, and may disrupt Archer’s

business strategy if it fails to do so.

Furthermore, acquisitions and the subsequent integration of new assets and businesses into

Archer’s own require significant attention from Archer’s management and could result in a diversion of resources from

Archer’s existing business, which in turn could have an adverse effect on Archer’s operations.

Acquired assets or businesses

may not generate the financial results Archer expects.

Acquisitions could result in the use of substantial amounts of cash, potentially

dilutive issuances of equity securities, the occurrence of significant goodwill impairment charges, amortization expenses for other

intangible assets and exposure to potential unknown liabilities of the acquired business.

Moreover, the costs of identifying and

consummating acquisitions may be significant.

Archer may need to defend itself against intellectual

property infringement claims or misappropriation claims, which may be time-consuming and expensive and, if adversely determined,

could limit Archer’s ability to commercialize its aircraft.

Companies, organizations or individuals,

including Archer’s competitors, may own or obtain patents, trademarks or other proprietary rights that could prevent or limit

Archer’s ability to make, use, develop or deploy its aircraft and aerial ride sharing services, which could make it more

difficult for Archer to operate its business.

Archer may receive inquiries from patent, copyright or trademark owners inquiring

whether Archer infringes upon their proprietary rights.

For example, Piper Aircraft, Inc.

filed suit against Archer on August 28,

2020 alleging that it is the owner of the ARCHER mark.

The proceeding is in the early stages and discovery is ongoing.

also be the subject of more formal allegations that Archer has misappropriated such parties’

trade secrets or other proprietary

Companies owning patents or other intellectual

property rights relating to battery packs, electric motors, aircraft configurations, fly-by-wire flight control software or electronic

power management systems may allege infringement or misappropriation of such rights.

In response to a determination that Archer

has infringed upon or misappropriated a third-party’s intellectual property rights, Archer may be required to do one or more

of the following:

cease development, sales or use of its products that incorporate the asserted intellectual property;

pay substantial damages;

obtain a license from the owner of the asserted intellectual property right, which license may not be available on reasonable

terms or available at all;

re-design one or more aspects or systems of its aircraft or other offerings.

A successful claim of infringement or misappropriation

against Archer could harm its business, prospects, financial condition and operating results.

Even if Archer is successful in defending

against these claims, litigation could result in substantial costs and demand on management resources.

Archer’s business may be adversely affected if it

is unable to protect its intellectual property rights from unauthorized use by third parties.

Failure to adequately protect Archer’s

intellectual property rights could result in Archer’s competitors offering similar products or services, potentially resulting

in the loss of some of Archer’s competitive advantage and a decrease in its revenue, which could adversely affect Archer’s

business, prospects, financial condition and operating results.

Archer s success depends, at least in part, on its ability to protect

its core technology and intellectual property.

To accomplish this, Archer will rely on a combination of patents, trade secrets

(including know-how), employee and third-party nondisclosure agreements, copyrights, trademarks, intellectual property licenses

and other contractual rights to establish and protect Archer’s rights in its technology.

The protection of Archer’s intellectual

property rights will be important to its future business opportunities.

However, the measures Archer takes to protect its intellectual

property from unauthorized use by others may not be effective for various reasons, including the following:

as noted below, any patent applications Archer submits may not result in the issuance of patents (and patents have not yet

issued to Archer based on its pending applications);

the scope of Archer’s patents that may subsequently issue may not be broad enough to protect its proprietary rights;

Archer’s issued patents may be challenged or invalidated by third parties;

Archer’s employees or business partners may breach their confidentiality, non-disclosure and non-use obligations to Archer;

third parties may independently develop technologies that are the same or similar to Archer’s;

the costs associated with enforcing patents, confidentiality and invention agreements or other intellectual property rights

may make enforcement impracticable;

current and future competitors may circumvent or otherwise design around Archer’s patents.

Patent, trademark, copyright and trade

secret laws vary throughout the world.

Some foreign countries do not protect intellectual property rights to the same extent as

do the laws of the United States.

Further, policing the unauthorized use of Archer’s intellectual property rights in foreign

jurisdictions may be difficult.

Therefore, Archer’s intellectual property rights may not be as strong or as easily enforced

outside of the U.S.

Also, while Archer has registered and applied

for trademarks in an effort to protect its investment in its brand and goodwill with customers, competitors may challenge the validity

of those trademarks and other brand names in which Archer has invested.

Such challenges can be expensive and may adversely affect

Archer’s ability to maintain the goodwill gained in connection with a particular trademark.

Archer’s aerial ride sharing operations will initially

be concentrated in a small number of metropolitan areas and airports which makes Archer’s business particularly susceptible

to natural disasters, outbreaks and pandemics, economic, social, weather, growth constraints and regulatory conditions or other

circumstances affecting these metropolitan areas.

Archer expects to initially launch its

aerial ride sharing offering in limited jurisdictions subject to receipt of the necessary operating authority.

Accordingly, Archer’s

business and results of operations are particularly susceptible to adverse economic, regulatory, political, weather and other conditions

in other markets that may become similarly concentrated.

As a result of Archer’s geographic concentration, its business and

financial results relating to its aerial ride sharing operations will be particularly susceptible to natural disasters, outbreaks

and pandemics, economic, social, weather, growth constraints and regulatory conditions or other circumstances in each of these

metropolitan areas.

In addition, any changes to local laws or regulations within these key metropolitan areas that affect Archer’s

ability to operate or increase its operating expenses in these markets would have an adverse effect on Archer’s business,

financial condition and operating results.

Disruption of operations at the airports

where Archer’s terminal facilities are expected to initially be located, whether caused by labor relations, utility or communications

issues or fuel shortages, could harm Archer’s business.

Certain airports may regulate flight operations, such as limiting

the number of landings per year, which could reduce Archer’s aerial ride sharing operations.

Bans on Archer’s airport

operations or the introduction of any new permitting requirements would significantly disrupt its operations.

In addition, demand

for Archer’s urban air mobility services could be impacted if drop-offs or pick-ups of fliers become inconvenient because

of airport rules or regulations, or more expensive for fliers because of airport-imposed fees, which would adversely affect Archer’s

business, financial condition and operating results.

Archer’s expected concentration in

large metropolitan areas and heavily trafficked airports also makes its business susceptible to an outbreak of a contagious disease,

such as the Ebola virus, Middle East Respiratory Syndrome, Severe Acute Respiratory Syndrome, H1N1 influenza virus, avian flu,

Zika virus, COVID-19 or any other similar illness, both due to the risk of a contagious disease being introduced into the metropolitan

area through the high volume of travelers flying into and out of such airports and the ease at which contagious diseases can spread

through densely populated areas, as seen with the spread of COVID-19 in Los Angeles, California and New York, New York.

Natural disasters, including tornados,

hurricanes, floods and earthquakes, and severe weather conditions, such as heavy rains, strong winds, dense fog, blizzards or snowstorms,

may damage Archer’s facilities, those of independent third-party aircraft operators or otherwise disrupt flights into or

out of the airports from which Archer’s aircraft arrive or depart.

Major metropolitan areas, including

those in which Archer expects to operate in, are also at risk of terrorist attacks, actual or threatened acts of war,

political disruptions and other disruptions.

The occurrence of one or more natural disasters, severe weather events, epidemic

or pandemic outbreaks, terrorist attacks or disruptive political events in regions where Archer’s facilities are or

will be located, or where its independent third-party aircraft operators’

facilities are located, could adversely

affect Archer’s business.

Compliance with any applicable privacy and data security laws and regulations is a rigorous and time-intensive process, and we may be required to put in place additional mechanisms to comply with such laws and regulations.

In addition, we are or may become subject to a variety of foreign laws and regulations regarding privacy, data protection, and data security.

These laws and regulations are continuously evolving and developing.

The scope and interpretation of the laws that are or may be applicable to us are often uncertain and may be conflicting, particularly with respect to foreign laws.

Such laws and regulations often have changes in scope, may be subject to differing interpretations, and may be inconsistent among different jurisdictions.

For example, the European General Data Protection Regulation (“GDPR”), which became effective in May 2018, includes operational requirements for companies that receive or process personal data of residents of the

European Union that are broader and more stringent than those previously in place in the European Union.

The GDPR includes significant penalties for non-compliance, including fines of up to €20 million or 4% of total worldwide revenue.

Additionally, we may be subject to evolving laws and regulations regarding the transfer of personal data outside of the European Economic Area, or EEA.

Recently, the Court of Justice of the European Union ruled that the EU-U.S.

Privacy Shield is an invalid transfer mechanism, but upheld Standard Contractual Clauses as a valid transfer mechanism.

The validity of data transfer mechanisms remains subject to legal, regulatory, and political developments in both Europe and the United States.

The invalidation of the EU-U.S.

Privacy Shield and potential invalidation of other data transfer mechanisms could have a significant adverse impact on our ability to process and transfer personal data outside of the EEA.

Governments are continuing to focus on privacy and data security, and it is possible that new privacy or data security laws will be enacted or existing laws will be amended in a way that is material to our business.

Any significant change to applicable laws, regulations, or industry practices regarding our users’ data could require us to modify our services and features, possibly in a material manner, and may limit our ability to develop new products, services, and features.

Although we have made efforts to design our policies, procedures, and systems to comply with the current requirements of applicable state, federal, and foreign laws, changes to applicable laws and regulations in this area could subject us to additional regulation and oversight, any of which could significantly increase our operating costs.

We publish privacy policies and other documentation regarding our collection, processing, use and disclosure of personal information and/or other confidential information.

Although we endeavor to comply with our published policies and other documentation, we may at times fail to do so or may be perceived to have failed to do so.

Moreover, despite our efforts, we may not be successful in achieving compliance if our employees, contractors, service providers or vendors fail to comply with our published policies and documentation.

Such failures can subject us to potential local, state and federal action if we are found to be deceptive, unfair, or misrepresentative of our actual practices.

Claims that we have violated individuals’ privacy rights or failed to comply with data protection laws or applicable privacy notices even if we are not found liable, could be expensive and time-consuming to defend and could result in adverse publicity that could harm our business.

We are subject to risks associated with climate change, including the potential increased impacts of severe weather events on our operations and infrastructure.

The potential physical effects of climate change, such as increased frequency and severity of storms, floods, fires, fog, mist, freezing conditions, sea-level rise and other climate-related events, could affect our operations, infrastructure and financial results.

Certain of the locations where our terminal facilities are expected to initially be located in connection with our aerial ride sharing operations are susceptible to the impacts of storm-related flooding and sea-level rise, which could result in costs and loss of revenue.

We could incur significant costs to improve the climate resiliency of our infrastructure and otherwise prepare for, respond to, and mitigate such physical effects of climate change.

We are not able to accurately predict the materiality of any potential losses or costs associated with the physical effects of climate change.

We intend to retain certain personal information about our customers, employees or others that, if compromised, could harm our financial performance and results of operations or prospects.

We are subject to a wide variety of laws in the United States and other jurisdictions related to privacy, data protection and consumer protection that are often complex and subject to varying interpretations.

As a result, these privacy, data protection and consumer protection laws may change or develop over time through judicial decisions or as new guidance or interpretations are provided by regulatory and governing bodies and such changes or developments may be contrary to our existing practices.

This may cause us to expend resources on updating, changing or eliminating some of our privacy and data protection practices.

We plan to collect, store, transmit and otherwise process data from our aircraft, our customers, our employees and others as part of our business and operations, which may include personal data or confidential or proprietary information.

We also work with partners and third-party service providers or vendors that collect, store and process such data on our behalf and in connection with our aircraft.

There can be no assurance that any security measures that we or our third-party service providers or vendors have implemented will be effective against current or future security threats.

If a compromise of data were to occur, we may become liable under our contracts with other parties and under applicable law for damages and incur penalties and other costs to respond to, investigate and remedy such an incident.

Our systems, networks and physical facilities could be breached, or personal information could otherwise be compromised due to employee error or malfeasance, if, for example, third parties attempt to fraudulently induce our employees or our customers to disclose information or usernames and/or passwords.

Third parties may also exploit vulnerabilities in, or obtain unauthorized access to, platforms, systems, networks and/or physical facilities utilized by our third-party service providers and vendors.

Our aircraft contain complex information technology systems and built-in data connectivity to share aircraft data with ground operations infrastructure.

We plan to design, implement and test security measures intended to prevent unauthorized access to our information technology networks, our aircraft and related systems.

However, hackers may attempt to gain unauthorized access to modify, alter and use such networks, aircraft and systems to gain control of or to change our aircraft’s functionality, performance characteristics, or to gain access to data stored in or generated by the aircraft.

A significant breach of our third-party service providers’ or vendors’ or our own network security and systems could have serious negative consequences for our business and future prospects, including possible fines, penalties and damages, reduced customer demand for our aircraft or urban aerial ride sharing services and harm to our reputation and brand.

We may not have adequate insurance coverage.

The successful assertion of one or more large claims against us that exceeds our available insurance coverage, or results in changes to our insurance policies (including premium increases or the imposition of large deductible or co-insurance requirements), could have an adverse effect on our business.

In addition, we cannot be sure that our existing insurance coverage will continue to be available on acceptable terms or that our insurers will not deny coverage as to any future claim.

The requirements of being a public company may strain our resources, divert management’s attention and affect our ability to attract and retain additional executive management and qualified board members.

We are subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, the listing requirements of the NYSE and other applicable securities rules and regulations.

Compliance with these rules and regulations has increased, and will continue to increase, our legal and financial compliance costs, make some activities more difficult, time-consuming, or costly, and increase demand on our systems and resources, particularly after we are no longer an emerging growth company.

The Exchange Act requires, among other things, that we file annual, quarterly, and current reports with respect to our business and operating results.

The Sarbanes-Oxley Act requires, among other things, that we maintain effective disclosure controls and procedures and internal control over financial reporting.

In order to maintain and improve our disclosure controls and procedures and internal control over financial reporting to meet this standard, significant resources and management oversight have been and may in the future be required.

As a result, management’s attention may be diverted from other business concerns, which could adversely affect our business and operating results.

Although we have already hired additional employees to comply with these requirements, we may need to hire more employees in the future or engage outside consultants, which would increase our costs and expenses.

In addition, changing laws, regulations, and standards relating to corporate governance and public disclosure are creating uncertainty for public companies, increasing legal and financial compliance costs, and making some activities more time consuming.

These laws, regulations, and standards are subject to varying interpretations, in many cases due to their lack of specificity, and, as a result, their application in practice may evolve or otherwise change over time as new guidance is provided by regulatory and governing bodies.

This could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices.

We intend to invest resources to comply with evolving laws, regulations, and standards (or changing interpretations of them), and this investment may result in increased selling, general and administrative expenses and a diversion of management’s time and attention from revenue-generating activities to compliance activities.

If our efforts to comply with new laws, regulations, and standards differ from the activities intended by regulatory or governing bodies due to ambiguities related to their application and practice, regulatory authorities may initiate legal proceedings against us, and our business may be adversely affected.

As a public company, we have also had to incur increased expenses in order to obtain director and officer liability insurance, and we may be required to accept reduced coverage or incur substantially higher costs to maintain the same or similar coverage or obtain coverage in the future.

These factors could also make it more difficult for us to attract and retain qualified members of our board of directors, particularly to serve on our audit committee, compensation committee, and nominating and governance committee, and qualified executive officers.

As a result of disclosure of information in the filings required of a public company, our business and financial condition is more visible, which may result in threatened or actual litigation, including by competitors.

If such claims are successful, our business and operating results could be adversely affected, and even if the claims do not result in litigation or are resolved in our favor, these claims, and the time and resources necessary to resolve them, could divert the resources of our management and adversely affect our business and operating results.

In addition, as a result of our disclosure obligations as a public company, we have reduced flexibility and are under pressure to focus on short-term results, which may adversely affect our ability to achieve long-term profitability.

We are or may be subject to risks associated with strategic relationships or other opportunities and may not be able to identify adequate strategic relationship opportunities, or form strategic relationships, in the future.

We have entered into strategic relationships, and may in the future enter into additional strategic relationships or joint ventures or minority equity investments, in each case with various third parties for the production of our aircraft as well as with other collaborators with capabilities on data and analytics and engineering.

These alliances subject us to a number of risks, including risks associated with sharing proprietary information, non-performance by the third-party and increased expenses in establishing new strategic relationships, any of which may adversely affect our business.

We may have limited ability to monitor or control the actions of these third parties and, to the extent any of these strategic third parties suffer negative publicity or harm to their reputation from events relating to their business, we may also suffer negative publicity or harm to our reputation by virtue of our association with any such third party.

Strategic business relationships will be an important factor in the growth and success of our business.

However, there are no assurances that we will be able to continue to identify or secure suitable business relationship opportunities in the future or our competitors may capitalize on such opportunities before we do.

Moreover, identifying such opportunities could require substantial management time and resources, and negotiating and financing relationships involves significant costs and uncertainties.

If we are unable to successfully source and execute on strategic relationship opportunities in the future, our overall growth could be impaired, and our business, prospects, financial condition and operating results could be adversely affected.

When appropriate opportunities arise, we may acquire or license additional assets, products, technologies or businesses that are complementary to our existing business.

In addition to possible stockholder approval, we may need approvals and licenses from relevant government authorities for the acquisitions or licenses and to comply with any applicable laws and regulations, which could result in increased delay and costs, and may disrupt our business strategy if we fail to do so.

Furthermore, acquisitions or licenses and the subsequent integration of new assets and businesses into our own would likely require significant attention from our management and could result in a diversion of resources from our existing business, which in turn could have an adverse effect on our operations.

Acquired or licensed assets or businesses may not generate the financial results we expect.

Acquisitions or licenses could result in the use of substantial amounts of cash, potentially dilutive issuances of equity securities, the occurrence of significant goodwill impairment charges, amortization expenses for other intangible assets and exposure to potential unknown liabilities of the acquired business.

Moreover, the costs of identifying and consummating acquisitions may be significant.

We have been sued by a competitor alleging misappropriation by us of certain of their trade secrets and infringement by us of certain of their patents.

On April 6, 2021, Wisk brought a lawsuit against us in the United States District Court for the Northern District of California (the “District Court”) alleging misappropriation of trade secrets and patent infringement.

On June 1, 2021, we filed a motion to dismiss the trade secret claims and filed counterclaims.

On June 15, 2021, Wisk amended its complaint, and the following day we filed a motion to dismiss the amended complaint.

On July 13, 2021, we filed amended counterclaims.

On July 27, 2021, Wisk filed a motion to strike and dismiss certain of our amended counterclaims.

On August 10, 2021, we filed an opposition to Wisk’s motion to strike and dismiss certain of the amended counterclaims.

On August 24, 2021, the District Court denied our motion to dismiss the trade secret claims.

On September 14, 2021, the District Court denied Wisk’s motion to strike and dismiss certain of our amended counterclaims.

A trial on Wisk’s claims and our counterclaims has been scheduled to begin on January 30, 2023.

On May 19, 2021, Wisk filed a motion for preliminary injunction and expedited discovery.

On June 23, 2021, we filed an opposition to the motion for preliminary injunction.

On July 22, 2021, the District Court denied Wisk’s motion for preliminary injunction.

On August 20, 2021, Wisk filed a notice of appeal of the District Court’s denial of the motion for preliminary injunction.

On September 30, 2021, Wisk withdrew its notice of appeal of the District Court’s denial of the motion for preliminary injunction.

Prior to Wisk bringing the lawsuit against us, on March 30, 2021, one of our employees, who is a former employee of Wisk, had a search warrant executed at his home in connection with a federal investigation.

We placed this former Wisk employee on paid administrative leave in connection with this government investigation.

In relation to the same investigation, we and three of our employees, who are also former Wisk employees, received grand jury subpoenas from the United States Attorney’s Office for the Northern District of California.

On January 28, 2022, the U.S.

Attorney’s Office informed us that,

based on its review, it has made the decision not to bring charges against this employee and does not intend to continue its investigation.

The proceedings are in the early stages.

We cannot predict their outcome or impact on us and our business.

We have incurred and expect to continue to incur significant costs in defending and responding to the proceedings.

Our business plan does not include the cost of any meaningful award of damages or settlement with Wisk.

Therefore, a negative result in these proceedings could have a material adverse effect on our reputation, financial position, liquidity, operations, and cash flows.

In addition, other holders of intellectual property rights relating to electric aircraft or any other technology relevant to our products or services may initiate legal proceedings alleging infringement or misappropriation of such rights by us and our employees, either with respect to our own intellectual property or intellectual property we license from third parties.

Our pending proceedings and other future legal proceedings against us or our employees, regardless of outcome or merit, could be time consuming and expensive to defend or resolve, result in substantial diversion of management and technical resources, delay, limit or prevent our ability to make, develop, commercialize or deploy our aircraft and aerial ride sharing services and deteriorate our reputation and our business relationships, any of which could make it more difficult or impossible for us to operate our business or otherwise execute on our business plan and significantly adversely affect our business, financial condition, or results of operations.

In the event of an adverse outcome of the litigation, we may have to cease developing and/or using the asserted intellectual property, which could significantly adversely impact our business, financial condition, or results of operation.

In response to a determination or resolution that we or any of our employees have infringed upon or misappropriated a third party’s intellectual property rights, we may be required to take certain actions, including (without limitation) one or more of the following:

• cease development, sales or use of our aircraft or other products;

• pay substantial damages, interest, attorneys’ fees, costs and other amounts;

• transfer intellectual property rights to a competitor;

• obtain a license from the owner of the asserted intellectual property right, which license may not be available on reasonable terms or at all;

• terminate the employment of key employees;

• develop or re-develop an alternative design of our aircraft;

• re-develop one or more other aspects or systems of our aircraft or other offerings.

A successful claim of infringement or misappropriation against us or any of our employees could delay, limit or prevent our ability to commercialize our aircraft and could significantly adversely affect our business, prospects, financial condition or operating results.

Even if we are successful in defending against these claims, litigation could result in substantial costs and distraction to the company and our management over many years.

Our business may be adversely affected if we are unable to protect our intellectual property rights from unauthorized use by third parties.

Failure to adequately protect our intellectual property rights could result in our competitors offering similar products or services, potentially resulting in the loss of some of our competitive advantage and a decrease in our revenue, which could adversely affect our business, prospects, financial condition and operating results.

Our success depends, at least in part, on our ability to protect our core technology and intellectual property.

To accomplish this, we will rely on a combination of patents, trade secrets (including know-how), employee and third-party non-disclosure agreements, copyrights, trademarks, intellectual property licenses and other contractual rights to establish and protect our rights in our technology.

The protection of our intellectual property rights will be important to our future business opportunities.

However, the measures we take to protect our intellectual property from unauthorized use by others may not be effective for various reasons, including the following:

• any patent applications we submit may not result in the issuance of patents (and patents have not yet issued to us based on our pending applications);

• the scope of our patents that may subsequently issue may not be broad enough to protect our proprietary rights;

• our issued patents may be challenged or invalidated by third parties;

• our employees or business partners may breach their confidentiality, non-disclosure and non-use obligations to us;

• third parties may independently develop technologies that are the same or similar to ours;

• the costs associated with enforcing patents, confidentiality and invention agreements or other intellectual property rights may make enforcement impracticable;

• current and future competitors may circumvent or otherwise design around our patents.

Patent, trademark, copyright and trade secret laws vary throughout the world.

The laws in some foreign countries do not protect intellectual property rights to the same extent as the laws of the United States.

Furthermore, policing the unauthorized use of our intellectual property rights in foreign jurisdictions may be difficult.

Therefore, our intellectual property rights may not be as strong or as easily enforced outside of the United States.

Also, while we have registered and applied for trademarks in an effort to protect our investment in our brand and goodwill with customers, competitors may challenge the validity of those trademarks and other brand names in which we have invested.

Such challenges can be expensive and may adversely affect our ability to maintain the goodwill gained in connection with a particular trademark.

To the extent we expand our international activities, our exposure to unauthorized use of our technologies and proprietary information may increase.

We may also fail to detect unauthorized use of our intellectual property, or be required to expend significant resources to monitor and protect our intellectual property rights, including engaging in litigation, which may be costly, time-consuming, and divert the attention of management and resources, and may not ultimately be successful.

If we fail to meaningfully establish, maintain, protect and enforce our intellectual property rights internationally, our business, financial condition and results of operations could be adversely affected.

Our aerial ride sharing operations will initially be concentrated in a small number of urban areas, which makes our business particularly susceptible to natural disasters, outbreaks and pandemics, economic, social, weather, growth constraints and regulatory conditions or other circumstances affecting these metropolitan areas.

We expect to initially launch our aerial ride sharing offering in limited jurisdictions subject to receipt of the necessary operating approvals.

Accordingly, our business and results of operations are particularly susceptible to adverse economic, regulatory, political, weather and other conditions in other markets that may become similarly concentrated.

As a result of our geographic concentration, our business and financial results relating to our aerial ride sharing operations will be particularly susceptible to natural disasters, outbreaks and pandemics, economic, social, weather, growth constraints and regulatory conditions or other circumstances in each of these metropolitan areas.

In addition, any changes to local laws or regulations within these key urban areas that affect our ability to operate or increase our operating expenses in these markets would have an adverse effect on our business, financial condition and operating results.

Disruption of operations at the locations where our vertiport facilities are expected to initially be located, whether caused by labor relations, utility or communications issues or fuel shortages, could harm our business.

Certain locations may regulate flight operations, such as limiting the number of landings per year, which could reduce our aerial ride sharing operations.

Bans on eVTOL operations or the introduction of any new permitting requirements would significantly disrupt our operations.

In addition, demand for our Archer UAM services could be impacted if drop-offs or pick-ups of fliers become inconvenient because of vertiport rules or regulations, or more expensive for fliers because of vertiport-imposed fees, which would adversely affect our business, financial condition and operating results.

We expect concentration in large metropolitan areas and heavily trafficked airports also makes our business susceptible to an outbreak of a contagious disease, such as the Ebola virus, Middle East Respiratory Syndrome, Severe Acute Respiratory Syndrome, H1N1 influenza virus, avian flu, Zika virus, COVID-19 or any other similar illness, both due to the risk of a contagious disease affecting the urban area through the high volume of travelers flying into and out of such areas and the ease at which contagious diseases can spread through densely populated areas, as seen with the spread of COVID-19 in Los Angeles, California and New York, New York.

Natural disasters, including tornados, hurricanes, floods and earthquakes, and severe weather conditions, such as heavy rains, strong winds, dense fog, blizzards or snowstorms, may damage our facilities or those of our Archer Direct customers or otherwise disrupt flights into or out of the vertiports from which our aircraft arrive or depart.

Major urban areas, including those in which we expect to operate, are also at risk of terrorist attacks, actual or threatened acts of war, political disruptions and other disruptions.

The occurrence of one or more natural disasters, severe weather events, epidemic or pandemic outbreaks, terrorist attacks or disruptive political events in regions where our facilities are or will be located, or where our Archer Direct customers’ facilities are located, could adversely affect our business.

If we fail to maintain proper and effective internal controls over financial reporting our ability to produce accurate and timely financial statements could be impaired.

Pursuant to Section 404 of the Sarbanes-Oxley Act, our management will be required to report upon the effectiveness of our internal control over financial reporting.

When we lose our status as an “emerging growth company” and become an “accelerated filer” or a “large accelerated filer,” our independent registered public accounting firm will be required to attest to the effectiveness of our internal control over financial reporting.

The rules governing the standards that must be met for management to assess our internal control over financial reporting are complex and require significant documentation, testing, and possible remediation.

To achieve compliance with Section 404 within the prescribed period, we will be engaged in a process to document and evaluate our internal control over financial reporting, which is both costly and challenging.

In this regard, we will need to continue to dedicate internal resources, potentially engage outside consultants and adopt a detailed work plan to assess and document the adequacy of internal control over financial reporting, continue steps to improve control processes as appropriate, validate through testing that controls are functioning as documented and implement a continuous reporting and improvement process for internal control over financial reporting.

This process will be time-consuming, costly, and complicated.

We have experienced control deficiencies, including the material weaknesses in our internal control over financial reporting described elsewhere in this Annual Report, and may experience other control deficiencies in the future.

Any failure to maintain internal control over financial reporting could severely inhibit our ability to accurately report our financial condition, operating results, or cash flows.

If we are unable to conclude that our internal control over financial reporting is effective, or if our independent registered public accounting firm determines we have a material weakness in our internal control over financial reporting, or if we are unable to remediate our existing material weaknesses in our internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports, the market price of our common stock could decline, and we could be subject to sanctions or investigations by the NYSE, the SEC, or other regulatory authorities.

Failure to remedy any material weakness in our internal control over financial reporting, or to implement or maintain other effective control systems required of public companies, could also restrict our future access to the capital markets.

Regardless, changes in accounting standards and estimates could have a material adverse effect on our results of operations and financial position.

Generally accepted accounting principles and the related authoritative guidance for many aspects of our business, including revenue recognition, inventories, warranties, leases, income taxes, expected credit losses, fair-value measurements, and stock-based compensation, are complex and involve subjective judgments.

Changes in these rules or changes in the underlying estimates, assumptions or judgments by our management could have a material adverse effect on our results of operations and may retroactively affect previously reported results.

We are an emerging growth company and smaller reporting company within the meaning of the Securities Act, and the reduced reporting requirements applicable to emerging growth companies or smaller reporting companies could make our securities less attractive to investors and may make it more difficult to compare our performance to the performance of other public companies.

We are an “emerging growth company” as defined in Section 2(a)(19) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (“JOBS Act”).

As such, we are eligible for and may take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies for as long as we continue to be an emerging growth company, including, but not limited to, (a) not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, (b) reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and (c) exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

As a result, our stockholders may not have access to certain information they may deem important.

We will remain an emerging growth company until the earliest of (1) the last day of the fiscal year (a) following October 30, 2025, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated

filer, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three year period.

We cannot predict whether investors will find our securities less attractive because we will rely on these exemptions.

If some investors find our securities less attractive as a result of our reliance on these exemptions, the trading prices of our securities may be lower than they otherwise would be, there may be a less active trading market for our securities and the trading prices of our securities may be more volatile.

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.

We have 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, we, 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 our 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.

Additionally, we are a “smaller reporting company” as defined in Item 10(f)(1) of Regulation S-K.

Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements.

We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our shares of common stock held by non-affiliates equals or exceeds $250 million as of the end of that year’s second fiscal quarter, and (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year or the market value of our shares of common stock held by non-affiliates equals or exceeds $700 million as of the end of that year’s second fiscal quarter.

To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of our financial statements with other public companies difficult or impossible.

Our management team has limited experience managing a public company.

Most members of our management team have limited experience managing a publicly traded company, interacting with public company investors and regulators, and complying with the increasingly complex laws pertaining to public companies.

Our management team may not successfully or efficiently manage our transition to being a public company subject to significant regulatory oversight and reporting obligations under the federal securities laws and the continuous scrutiny of securities analysts and investors.

These new obligations and constituents require significant attention from our senior management and could divert their attention away from the day-to-day management of our business, which could adversely impact our business, operating results, and financial condition.

Our amended and restated certificate of incorporation requires, to the fullest extent permitted by law, that derivative actions brought in our name, actions against our directors, officers, other employees or stockholders for breach of fiduciary duty and other similar actions may be brought only in the Court of Chancery in the State of Delaware, which may have the effect of discouraging lawsuits against our directors, officers, other employees or stockholders.

Our amended and restated certificate of incorporation provides that (i) unless we consent in writing to the selection of an alternative forum, to the fullest extent permitted by the applicable law, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for any stockholder (including a beneficial owner) to bring (1) any derivative action or proceeding brought on behalf of us, (2) any action or proceeding asserting a claim of breach of a fiduciary duty owed by any current or former director, officer or other employee of ours or any stockholder of ours to us or our stockholders, (3) any action or proceeding asserting a claim against us or any of our current or former directors, officers or other employees or any stockholder arising pursuant to any provision of the Delaware General Corporation Law (the “DGCL”), our amended and restated certificate of incorporation or our bylaws, (4) any action or proceeding to interpret, apply, enforce or determine the validity of our certificate of incorporation or bylaws (or any right, obligation or remedy thereunder), (5) any action or proceeding as to which the DGCL confers jurisdiction to the Court of Chancery of the State of Delaware, and (6) any action asserting a claim against us or any director, officer or other employee of ours or any stockholder, governed by the internal affairs doctrine, in all cases to the fullest extent permitted by law and subject to the court’s having personal jurisdiction over the indispensable parties named as defendants, and (ii) unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States of America shall, to the fullest extent permitted by law, be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act or the rules and regulations promulgated thereunder.

holding, owning or otherwise acquiring any interest in shares of our capital stock will be deemed to have notice of and to have consented to this forum selection provision.

This choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or any of our directors, officers, other employees or stockholders, which may discourage lawsuits with respect to such claims, although such stockholders will not be deemed to have waived our compliance with federal securities laws and the rules and regulations thereunder.

However, there is no assurance that a court would enforce the choice of forum provision contained in our amended and restated certificate of incorporation.

If a court were to find such provision to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could harm our business, operating results and financial condition.

The warrants originally issued by Atlas are accounted for as liabilities and changes in the value of these warrants could have a material effect on our financial results.

On April 12, 2021, the staff of the SEC (the “SEC Staff”) expressed its view that certain terms and conditions common to special purpose acquisition company (“SPAC”) warrants may require the warrants to be classified as liabilities instead of equity on a SPAC’s balance sheet.

As a result of the SEC Staff’s statement, Atlas reevaluated the accounting treatment of its public warrants and private placement warrants, and determined to classify the warrants as derivative liabilities measured at fair value, with changes in fair value reported in its statement of operations for each reporting period.

See Note 14 - Liability Classified Warrants to our audited consolidated financial statements for the year ended December 31, 2021, for additional information about our public and private warrants that were originally issued by Atlas.

Accounting Standards Codification (“ASC”) 815-40 provides for the remeasurement of the fair value of such derivatives at each balance sheet date, with a resulting non-cash gain or loss related to the change in the fair value being recognized in earnings in the statement of operations and comprehensive loss.

As a result of the recurring fair value measurement, our financial statements and results of operations may fluctuate quarterly based on factors which are outside of our control.

Due to the recurring fair value measurement, we expect that we will recognize non-cash gains or losses on our warrants each reporting period and that the amount of such gains or losses could be material.

Investors’ expectations of our performance relating to environmental, social and governance (“ESG”) factors may impose additional costs and expose us to new risks.

There is an increasing focus from investors, employees, customers and other stakeholders concerning corporate responsibility, specifically related to ESG matters.

Some investors may use these non-financial performance factors to guide their investment strategies and, in some cases, may choose not to invest in us if they believe our policies and actions relating to corporate responsibility are inadequate.

The growing investor demand for measurement of non-financial performance is addressed by third-party providers of sustainability assessment and ratings on companies.

The criteria by which our corporate responsibility practices are assessed may change due to the constant evolution of the sustainability landscape, which could result in greater expectations of us and cause us to undertake costly initiatives to satisfy such new criteria.

If we elect not to or are unable to satisfy such new criteria, investors may conclude that our policies and/or actions with respect to corporate social responsibility are inadequate.

We may face reputational damage in the event that we do not meet the ESG standards set by various constituencies.

Furthermore, in the event that we communicate certain initiatives and goals regarding ESG matters, we could fail, or be perceived to fail, in our achievement of such initiatives or goals, or we could be criticized for the scope of such initiatives or goals.

If we fail to satisfy the expectations of investors, customers, employees and other stakeholders or our initiatives are not executed as planned, our reputation and business, operating results and financial condition could be adversely impacted.

Changes in financial accounting standards may cause adverse unexpected fluctuations and affect our reported results of operations.

A change in accounting standards or practices, and varying interpretations of existing or new accounting pronouncements, as well as significant costs incurred or that may be incurred to adopt and to comply with these new pronouncements, could have a significant effect on our reported financial results or the way we conduct our business.

If we do not ensure that our systems and processes are aligned with the new standards, we could encounter difficulties generating quarterly and annual financial statements in a timely manner, which could have an adverse effect on our business, our ability to meet our reporting obligations and compliance with internal control requirements.

Management will continue to make judgments and assumptions based on our interpretation of new standards.

If our circumstances change or if actual circumstances differ from our assumptions, our operating results may be adversely affected and could fall below our publicly announced guidance or the expectations of securities analysts and investors, resulting in a decline in the market price of our Class A common stock.

Risks Relating to Ownership of Our Securities

The price of our Class A common stock and warrants may be volatile and you could lose all or part of your investment as a result.

The price of our Class A common stock and warrants may fluctuate due to a variety of factors, including:

• results of operations that vary from the expectations of securities analysts and investors;

• results of operations that vary from those of our competitors;

• the impact of the COVID-19 pandemic and its effect on our business and financial conditions;

• changes in expectations as to our future financial performance, including financial estimates and investment recommendations by securities analysts and investors;

• declines in the market prices of stocks generally;

• strategic actions by us or our competitors;

• announcements by us or our competitors of significant contracts, acquisitions, joint ventures, other strategic relationships or capital commitments;

• any significant change in our management;

• changes in general economic or market conditions or trends in our industry or markets, such as inflation, recessions, interest rates, local and national elections, international currency fluctuations, corruption, political instability and acts of war, such as the current situation with Ukraine and Russia, or terrorism;

• changes in business or regulatory conditions, including new laws or regulations or new interpretations of existing laws or regulations applicable to our business;

• future sales of our Class A common stock or other securities;

• investor perceptions or the investment opportunity associated with our Class A common stock relative to other investment alternatives;

• the public’s response to press releases or other public announcements by us or third parties, including our filings with the SEC;

• litigation involving us, our industry, or both, or investigations by regulators into our operations or those of our competitors;

• guidance, if any, that we provide to the public, any changes in this guidance or our failure to meet this guidance;

• the development and sustainability of an active trading market for our stock;

• actions by institutional or activist stockholders;

• changes in accounting standards, policies, guidelines, interpretations or principles;

• other events or factors, including those resulting from natural disasters, war, acts of terrorism or responses to these events.

These broad market and industry fluctuations may adversely affect the market price of our Class A common stock and warrants, regardless of our actual operating performance.

In addition, price volatility may be greater if the public float and trading volume of our Class A common stock is low.

In the past, following periods of market volatility, stockholders have instituted securities class action litigation.

If we were involved in securities litigation, it could have a substantial cost and divert resources and the attention of executive management from our business regardless of the outcome of such litigation.

The dual-class structure of our common stock has the effect of concentrating voting power with our co-Chief Executive Officers and co-founders, which limits an investor’s ability to influence the outcome of important transactions, including a change in control.

Shares of our Class B common stock have ten votes per share, while shares of our Class A common stock have one vote per share.

Brett Adcock and Adam Goldstein, our co-founders, co-Chairmen of our board of directors and co-Chief Executive Officers, hold a substantial majority of the issued and outstanding shares of Class B common stock and, as a result, a substantial majority of the voting power of our capital stock on an outstanding basis and are able to control matters submitted to our stockholders for approval, including the election of directors, amendments of our organizational documents and any merger, consolidation, sale of all or substantially all of our assets or other major corporate transactions.

Adcock and Goldstein may have interests that differ from other stockholders and may vote in a way which may be adverse to other stockholders or with which our other stockholders may disagree.

This concentrated control may have the effect of delaying, preventing or deterring a change in control, could deprive our stockholders of an opportunity to receive a premium for their capital stock as part of a sale, and might ultimately affect the market price of our Class A common stock.

We cannot predict the impact that our dual-class structure may have on the stock price of our Class A common stock.

We cannot predict whether our dual-class structure will result in a lower or more volatile market price of Class A common stock or in adverse publicity or other adverse consequences.

For example, certain index providers have announced restrictions on including companies with multiple-class share structures in certain of their indexes.

In July 2017, FTSE Russell and S&P Dow Jones announced that they would cease to allow most newly public companies utilizing dual or multi-class capital structures to be included in their indexes.

Affected indexes include the Russell 2000 and the S&P 500, S&P MidCap 400 and S&P SmallCap 600, which together make up the S&P Composite 1500.

Beginning in 2017, MSCI, a leading stock index provider, opened public consultations on their treatment of no-vote and multi-class structures and temporarily barred new multi-class listings from certain of its indexes;

however, in October 2018, MSCI announced its decision to include equity securities “with unequal voting structures” in its indexes and to launch a new index that specifically includes voting rights in its eligibility criteria.

Under the announced policies, our dual-class capital structure makes us ineligible for inclusion in certain indexes, and as a result, mutual funds, exchange-traded funds and other investment vehicles that attempt to passively track those indexes will not be investing in our stock.

These policies are still new, and it remains unclear what effect, if any, they will have on the valuations of publicly traded companies excluded from such indexes, but it is possible that they may depress these valuations compared to those of other similar companies that are included.

Because of our dual-class structure, we are likely excluded from certain of these indexes and we cannot assure you that other stock indexes will not take similar actions.

Given the sustained flow of investment funds into passive strategies that seek to track certain indexes, exclusion from stock indexes likely precludes investment by many of these funds and could make our Class A common stock less attractive to other investors.

As a result, the market price of our Class A common stock could be adversely affected.

We may be required to take write-downs or write-offs, or may be subject to restructuring, impairment or other charges that could have a significant negative effect on our financial condition, results of operations and the price of our Class A common stock, which could cause you to lose some or all of your investment.

Factors outside of our control may, at any time, arise.

As a result of these factors, we may be forced to later write-down or write-off assets, restructure operations, or incur impairment or other charges that could result in reporting losses.

Unexpected risks may arise, and previously known risks may materialize.

Even though these charges may be non-cash items and therefore not have an immediate impact on our liquidity, we must report charges of this nature which could contribute to negative market perceptions about us or our securities.

In addition, charges of this nature may cause us to be unable to obtain future financing on favorable terms or at all.

There can be no assurance that we will be able to comply with the continued listing standards of the NYSE.

The NYSE may delist our securities from trading on its exchange, which could limit investors’ ability to make transactions in our securities and subject us to additional trading restrictions.

Our Class A common stock and public warrants are listed on the NYSE under the symbols “ACHR” and “ACHR WS,” respectively.

We cannot assure you that our securities will continue to be listed on the NYSE.

We are required to demonstrate compliance with the NYSE’s continued listing requirements in order to continue to maintain the listing of our securities on the NYSE.

If the NYSE delists our securities from trading on its exchange and we are not able to list our securities on another national securities exchange, our securities could be quoted on an over-the-counter market.

If this were to occur, we could face significant adverse consequences, including:

• a limited availability of market quotations for our securities;

• reduced liquidity for our securities;

• a determination that our Class A common stock is a “penny stock” which will require brokers trading in our Class A common stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities;

• a limited amount of news and analyst coverage;

• a decreased ability to issue additional securities or obtain additional financing in the future.

The National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred to as “covered securities.” Because our Class A common stock and public warrants are listed on the NYSE, our Class A common stock and public warrants qualify as covered securities.

Although states are preempted from regulating the sale of our securities, the federal statute does allow states to investigate companies if there is a suspicion of fraud.

If there is a finding of fraudulent activity, then states can regulate or bar the sale of covered securities in a particular case.

Further, if we were no longer listed on the NYSE, our securities would not be covered securities and we would be subject to regulation in each state in which we offer our securities.

Because there are no current plans to pay cash dividends on our common stock for the foreseeable future, you may not receive any return on investment unless you sell your common stock for a price greater than that which you paid for it.

We intend to retain future earnings, if any, for future operations, expansion and debt repayment and there are no current plans to pay any cash dividends for the foreseeable future.

The declaration, amount and payment of any future dividends on shares of our common stock will be at the sole discretion of our board of directors.

Our board of directors may take into account general and economic conditions, our financial condition and results of operations, our available cash and current and anticipated cash needs, capital requirements, contractual, legal, tax, and regulatory restrictions, implications on the payment of dividends by us to our stockholders or by our subsidiaries to us and such other factors as our board of directors may deem relevant.

In addition, our ability to pay dividends is limited by covenants of our existing and outstanding indebtedness and may be limited by covenants of any future indebtedness we incur.

As a result, you may not receive any return on an investment in our common stock unless you sell our common stock for a price greater than that which you paid for it.

If securities analysts do not publish research or reports about our business or if they downgrade our stock or our sector, our stock price and trading volume could decline.

The trading market for our Class A common stock will rely in part on the research and reports that industry or financial analysts publish about us or our business.

We will not control these analysts.

In addition, some financial analysts may have limited expertise with our model and operations.

Furthermore, if one or more of the analysts who do cover us downgrade our stock or industry, or the stock of any of our competitors, or publish inaccurate or unfavorable research about our business, the price of our stock could decline.

If one or more of these analysts ceases to cover us or fails to initiate coverage or publish reports on us regularly, we could lose visibility in the market, which in turn could cause our stock price or trading volume to decline.

Future sales, or the perception of future sales, by us or our stockholders in the public market could cause the market price for our Class A common stock to decline.

The sale of shares of our Class A common stock in the public market, or the perception that such sales could occur, could harm the prevailing market price of shares of our Class A common stock.

These sales, or the possibility that these sales may occur, also might make it more difficult for us to sell equity securities in the future at a time and at a price that we deem appropriate.

All shares issued in the Business Combination that were registered on our registration statement on Form S-4, which was declared effective on August 11, 2021, are freely tradable without restriction by persons other than our “affiliates,” (as defined under Rule 144 of the Securities Act (“Rule 144”), including our directors, executive officers and other affiliates.

Atlas Crest Investment LLC (“Sponsor”) and certain substantial holders of Legacy Archer’s common stock (determined on an as-converted basis) (the “Investors”) have agreed, subject to certain exceptions, not to transfer or dispose of our common stock during the period from the date of the closing of the Business Combination through the earlier of (i) March 15, 2022, (ii) the date that the closing price of our Class A common stock equals or exceeds $12.00 for 20 trading days within any 30 trading day period following the 90th day following the Business Combination and (iii) the consummation of a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of our stockholders having the right to exchange their shares of our Class A common stock for cash, securities or other property.

Upon the expiration or waiver of the lock-ups, shares held by the Investors and certain other holders of our Class A common stock will be eligible for resale, subject to volume, manner of sale and other limitations under Rule 144, when such rule becomes applicable to us.

Additionally, our registration statement on Form S-1 relating to the offer and sale from time to time by the selling securityholders named therein of up to 166,605,041 shares of Class A common stock, was declared effective by the SEC on October 26, 2021.

In addition, pursuant to the Amended and Restated Registration Rights Agreement, the Investors and certain other stockholders will have the right, subject to certain conditions, to require us to register the sale of their shares of our Class A common stock under the Securities Act.

By exercising their registration rights and selling a large number of shares in reliance on the registration statement on Form S-1, these stockholders could cause the prevailing market price of our Class A common stock to decline.

Following closing of the Business Combination, 198,552,323 shares of Class A common stock and up to 18,024,399 shares of Class A common stock issuable upon the exercise of warrants are covered by such registration rights.

As restrictions on resale end or if these stockholders exercise their registration rights, the market price of our Class A common stock could drop significantly if the holders of these shares sell them or are perceived by the market as intending to sell them.

These factors could also make it more difficult for us to raise additional funds through future offerings of our Class A common stock or other securities.

In addition, outstanding warrants to purchase an aggregate of 24,666,667 shares of our Class A common stock became exercisable on October 30, 2021.

Each warrant entitles the holder thereof to purchase one (1) share of our Class A common stock at a price of $11.50 per whole share, subject to adjustment.

Warrants may be exercised only for a whole number of shares of our Class A common stock.

To the extent such warrants are exercised, additional shares of our Class A common stock will be issued, which will result in dilution to the then existing holders of our Class A common stock and increase the number of shares eligible for resale in the public market.

In addition, the shares of our common stock reserved for future issuance under our equity incentive plans will become eligible for sale in the public market once those shares are issued, subject to provisions relating to various vesting agreements, lock-up agreements and, in some cases, limitations on volume and manner of sale applicable to affiliates under Rule 144, as applicable.

We filed a registration statement on Form S-8, which became effective on December 8, 2021, to register shares of our common stock or securities convertible into or exchangeable for shares of our common stock issued pursuant to our equity incentive plans.

We expect to file additional registration statements on Form S-8 in the future to register additional shares reserved for future issuance under our equity incentive plans, and Form S-8 registration statement automatically becomes effective upon filing.

Accordingly, shares registered under such registration statements will be available for sale in the open market.

In the future, we may also issue our securities in connection with investments or acquisitions.

The amount of shares of our common stock issued in connection with an investment or acquisition could constitute a material portion of our then-outstanding Class A common stock.

Any issuance of additional securities in connection with investments or acquisitions may result in additional dilution to our stockholders.

Anti-takeover provisions in our governing documents could delay or prevent a change of control.

Certain provisions of our amended and restated certificate of incorporation and our amended and restated bylaws have an anti-takeover effect and may delay, defer or prevent a merger, acquisition, tender offer, takeover attempt or other change of control transaction that a stockholder might consider in its best interest, including those attempts that might result in a premium over the market price for the shares held by our stockholders.

These provisions provide for, among other things:

• the ability of our board of directors to issue one or more series of preferred stock;

• a classified board;

• a dual-class share structure;

• advance notice for nominations of directors by stockholders and for stockholders to include matters to be considered at our annual meetings;

• certain limitations on convening special stockholder meetings;

• limiting the ability of stockholders to act by written consent;

• our board of directors has the express authority to make, alter or repeal our amended and restated bylaws.

These anti-takeover provisions could make it more difficult for a third party to acquire us, even if the third party’s offer may be considered beneficial by many of our stockholders.

As a result, our stockholders may be limited in their ability to obtain a premium for their shares.

These provisions could also discourage proxy contests and make it more difficult for you and other stockholders to elect directors of your choosing and to cause us to take other corporate actions you desire.

Unresolved Staff Comments

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors