QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification Number) |
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
Non-accelerated filer |
☒ | Smaller reporting company | ||||
Emerging growth company |
Page No. | ||||
PART I. FINANCIAL INFORMATION |
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Item 1. | Financial Statements | 1 | ||
Condensed Balance Sheets as of June 30, 2021 (Unaudited) and December 31, 2020 (as restated) | 1 | |||
Unaudited Condensed Statements of Operations for the three and six months ended June 30, 2021 (as restated) | 2 | |||
Unaudited Condensed Statements of Changes in Shareholders’ Deficit for the three and six months ended June 30, 2021 (as restated) | 3 | |||
Unaudited Condensed Statement of Cash Flows for the six months ended June 30, 2021 (as restated) | 4 | |||
Notes to Unaudited Condensed Financial Statements (as restated) | 5 | |||
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 23 | ||
Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 29 | ||
Item 4. | Controls and Procedures (as restated) | 29 | ||
PART II. OTHER INFORMATION |
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Item 1. | Legal Proceedings | |||
Item 1A. | Risk Factors | |||
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 31 | ||
Item 6. | Exhibits | 32 | ||
PART III. SIGNATURES |
June 30, 2021 |
December 31, 2020 |
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(unaudited) |
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Assets |
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Current assets: |
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Cash |
$ | $ | ||||||
Prepaid expenses |
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Total current assets |
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Other assets |
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Investments held in Trust Account |
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Total Assets |
$ |
$ |
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Liabilities, Class A Ordinary Shares Subject to Possible Redemption and Shareholders’ Deficit |
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Current liabilities: |
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Accounts payable |
$ | $ | — | |||||
Accrued expenses |
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Accrued expenses - related party |
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Total current liabilities |
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Deferred underwriting commissions |
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Derivative warrant liabilities |
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Total liabilities |
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Commitments and Contingencies (Note 7) |
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Class A ordinary shares; |
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Shareholders’ Deficit: |
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Preference shares, $ |
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Class A ordinary shares, $ |
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Class B ordinary shares, $ |
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Additional paid-in capital |
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Accumulated deficit |
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Total shareholders’ deficit |
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Total Liabilities, Class A Ordinary Shares Subject to Possible Redemption and Shareholders’ Deficit |
$ |
$ |
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For the three months ended June 30, 2021 |
For the six months ended June 30, 2021 |
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General and administrative expenses |
$ | $ | ||||||
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Loss from operations |
( |
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Other income (expense) |
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Change in fair value of derivative warrant liabilities |
( |
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Gain on marketable securities (net), and dividends held in Trust Account |
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Total other (expense) income |
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Net (loss) income |
$ | ( |
) | $ | ||||
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Weighted average Class A ordinary shares subject to possible redemption, basic and diluted |
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Basic and diluted net (loss) income per share, Class A ordinary shares subject to possible redemption |
$ | ( |
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Weighted average shares outstanding of Class B ordinary shares, basic and diluted |
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Basic and diluted net (loss) income per share, Class B ordinary shares |
$ | ( |
) | $ | ||||
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Ordinary Shares |
Additional Paid-in Capital |
Accumulated Deficit |
Total Shareholders’ Deficit |
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Class A |
Class B |
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Shares |
Amount |
Shares |
Amount |
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Balance - January 1, 2021 |
$ | $ |
$ | $ |
( |
) |
$ | ( |
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Net income |
— | — | — | — | — | |||||||||||||||||||||||
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Balance - March 31, 2021 (unaudited) |
$ |
$ |
$ |
$ |
( |
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$ |
( |
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Net loss |
— | — | — | — | — | ( |
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Balance - June 30, 2021 (unaudited) |
$ |
$ |
$ |
$ |
( |
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$ |
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Cash Flows from Operating Activities: |
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Net income |
$ | |||
Adjustments to reconcile net income to net cash used in operating activities: |
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Gain on marketable securities (net), and dividends held in Trust Account |
( |
) | ||
Change in fair value of derivative warrant liabilities |
( |
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Changes in operating assets and liabilities: |
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Prepaid expenses |
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Accounts payable |
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Accrued expenses |
( |
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Accrued expenses - related party |
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Net cash used in operating activities |
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Net decrease in cash |
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Cash - beginning of the period |
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Cash - end of the period |
$ |
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As of June 30, 2021 |
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Unaudited Condensed Balance Sheet |
As Previously Reported |
Adjustment |
As Restated |
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Total asset s |
$ |
$ |
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Total liabilities |
$ |
$ |
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Class A ordinary shares subject to possible redemptio n |
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Shareholders’ equity |
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Preference shares |
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Class A ordinary shares |
( |
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Class B ordinary shares |
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Additional paid-in capital |
( |
) | ||||||||||
Accumulated deficit |
( |
) | ( |
) | ( |
) | ||||||
Total shareholders’ equity (deficit) |
$ |
$ |
( |
) |
$ |
( |
) | |||||
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Total Liabilities, Class A Ordinary Shares Subject to Possible Redemption and Shareholders’ Equity (Deficit) |
$ |
$ |
$ |
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Three months ended June 30, 2021 |
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Unaudited Statement of Operations |
As Previously Reported |
Adjustment |
As Restated |
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Earnings (loss) allocable to ordinary shares subject to possible redemption |
$ | $ | ( |
) | $ | ( |
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Weighted average shares outstanding |
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Basic and diluted earnings per share |
$ | $ | ( |
) | $ | ( |
) | |||||
Loss allocable to non-redeemable ordinary shares |
$ | ( |
) | $ | $ | ( |
) | |||||
Weighted average shares outstanding |
( |
) | ||||||||||
Basic and diluted earnings per share |
$ | ( |
) | $ | $ | ( |
) |
Six months ended June 30, 2021 |
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Unaudited Statement of Operations |
As Previously Reported |
Adjustment |
As Restated |
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Earnings allocable to ordinary shares subject to possible redemption |
$ | $ | $ | |||||||||
Weighted average shares outstanding |
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Basic and diluted earnings per share |
$ | $ | $ | |||||||||
Earnings allocable to non-redeemable ordinary shares |
$ | $ | ( |
) | $ | |||||||
Weighted average shares outstanding |
( |
) | ||||||||||
Basic and diluted earnings per share |
$ | $ | ( |
) | $ |
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Six Months Ended June 30, 2021 |
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Unaudited Statement of Shareholders’ Deficit |
As Previously Reported |
Adjustment |
As Restated |
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Shares subject to redemptio n |
$ |
$ |
( |
) |
$ |
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Six Months Ended June 30, 2021 |
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Unaudited Statement of Cash Flows |
As Previously Reported |
Adjustment |
As Restated |
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Supplemental Disclosure of Noncash Financing Activities: |
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Change in value of Class A ordinary shares subject to possible redemption |
$ | ( |
) | $ | $ | |||||||
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• | Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets; |
• | Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and |
• | Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. |
For the Three Months Ended June 30, 2021 |
For the Six Months Ended June 30, 2021 |
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Class A |
Class B |
Class A |
Class B |
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Basic and diluted net loss per common share: |
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Numerator: |
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Allocation of net loss |
$ | ( |
) | $ | ( |
) | $ | $ | ||||||||
Denominator: |
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Basic and diluted weighted average common shares outstanding |
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Basic and diluted net ( loss) income per common share |
$ | ( |
) | $ | ( |
) | $ | $ | ||||||||
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• | in whole and not in part; |
• | at a price of $ |
• | upon a minimum of 30 days’ prior written notice of redemption to each warrant holder; and |
• | if, and only if, the last reported sale price (the “closing price”) of Class A ordinary shares equals or exceeds $ |
• | in whole and not in part; |
• | at $ provided |
• | if, and only if, the closing price of Class A ordinary shares equals or exceeds $ |
• | if the closing price of the Class A ordinary shares for any |
June 30, 2021 |
Quoted Prices in Active Markets |
Significant Other Observable Inputs |
Significant Other Unobservable Inputs |
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Description |
(Level 1) |
(Level 2) |
(Level 3) |
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Assets: |
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Investments held in Trust Account |
$ | $ | $ | |||||||||
Liabilities: |
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Warrant liabilities - Public warrants |
$ | $ | $ | |||||||||
Warrant liabilities - Private warrants |
$ | $ | $ |
December 31, 2020 |
Quoted Prices in Active Markets |
Significant Other Observable Inputs |
Significant Other Unobservable Inputs |
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Description |
(Level 1) |
(Level 2) |
(Level 3) |
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Assets: |
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Investments held in Trust Account |
$ | $ | $ | |||||||||
Liabilities: |
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Warrant liabilities - Public warrants |
$ | $ | $ | |||||||||
Warrant liabilities - Private warrants |
$ | $ | $ |
As of June 30, 2021 |
As of December 31 , 2020 |
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Stock price |
$ | $ | ||||||
Volatility |
% | % | ||||||
Expected life of the options to convert |
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Risk-free rate |
% | % | ||||||
Dividend yield |
Derivative warrant liabilities at December 31, 2020 |
$ | |||
Change in fair value of derivative warrant liabilities |
( |
) | ||
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Derivative warrant liabilities at June 30, 2021 |
$ | |||
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|
ESS TECH, INC. | ||
By: | /s/ Eric P. Dresselhuys | |
Name: | Eric P. Dresselhuys | |
Title: | Chief Executive Officer |