Item 1A. Risk Factors
ITEM 1A. RISK FACTORS
Factors that could cause our actual results to
differ materially from those in this Quarterly Report are any of the risks previously disclosed in our final prospectus filed with the
SEC on March 18, 2021 and the below risk factor. Any of those factors could result in a significant or material adverse effect on our
results of operations or financial condition. Additional risk factors not presently known to us or that we currently deem immaterial may
also impair our business or results of operations. As of the date of this Quarterly Report, other than as described below, there have
been no material changes to the risk factors disclosed in our final prospectus filed with the SEC on March 18, 2021 We may disclose changes
to such factors or disclose additional factors from time to time in our future filings with the SEC.
Our warrants are accounted for as liabilities
and the changes in value of our warrants could have a material effect on our financial results.
On April 12, 2021, the Acting Director of the
Division of Corporation Finance and Acting Chief Accountant of the SEC together issued a statement regarding the accounting and reporting
considerations for warrants issued by special purpose acquisition companies entitled “Staff Statement on Accounting and Reporting
Considerations for Warrants Issued by Special Purpose Acquisition Companies (“SPACs”)” (the “SEC Statement”).
Specifically, the SEC Statement focused on certain settlement terms and provisions related to certain tender offers following a Business
Combination, which terms are similar to those contained in the warrant agreement governing our warrants. As a result of the SEC Statement,
we reevaluated the accounting treatment of our 11,500,000 public warrants and 5,933,333 Private Placement Warrants and determined to classify
the warrants as derivative liabilities measured at fair value, with changes in fair value each period reported in earnings.
As a result, included on our balance sheet as
of June 30, 2021 contained elsewhere in this Quarterly Report are derivative liabilities related to embedded features contained within
our warrants. ASC 815, “Derivatives and Hedging,” (“ASC 815”), 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. 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.
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