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Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2021

The accompanying unaudited condensed financial statements of the Company have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the SEC. Accordingly, they do not include all of the information and footnotes required by GAAP. In the opinion of management, all adjustments (consisting of normal accruals and recurring adjustments) considered for a fair presentation have been included. Operating results for the three months ended March 31, 2021 are not necessarily indicative of the results that may be expected for the year ending December 31, 2021.

The accompanying unaudited condensed financial statements should be read in conjunction with Company’s prospectus for its Initial Public Offering as filed with the SEC on February 10, 2021, as well as the Company’s Current Reports on Form 8-K, as filed with the SEC on February 12, 2021 and April 1, 2021.

Emerging Growth Company

The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that an emerging growth company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s condensed financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

Use of Estimates

The preparation of condensed financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed financial statements and the reported amounts of expenses during the reporting period.

Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the condensed financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.

Restatement of Prior Period Financial Statements

On April 12, 2021, the Staff of the SEC issued a public statement entitled “Staff Statement on Accounting and Reporting Considerations for Warrants Issued by Special Purpose Acquisition Companies (“SPACs”)” (the “Statement”). In the Statement, the SEC Staff, among other things, expressed its view that certain terms and conditions common to warrants issued by special purpose acquisition companies, such as the Company, may require such warrants to be classified as liabilities on the special purpose acquisition company’s balance sheet as opposed to equity. The Company previously determined its outstanding Public Warrants (as defined in Note 3), Private Placement Warrants and Forward Purchase Warrants (collectively, the “Warrants”) to be equity transactions instead of derivative liabilities. However, as a result of the Statement, the Company’s management, together with the audit committee of the board of directors of the Company (the “Audit Committee”), re-evaluated the accounting for the Warrants under ASC 815-40, Derivatives and Hedging—Contracts in Entity’s Own Equity, and concluded that the Warrants do not meet the criteria to be classified in stockholders’ equity and that some of the offering costs should be allocated to Warrants. Accordingly, the Company should have classified the Warrants as derivative liabilities in its previously issued financial statements. Under this accounting treatment, the Company will be required to re-measure the fair value of the Warrants at the end of each reporting period and recognize changes in the fair value of the Warrants from the prior period in the Company’s operating results for such period.

On May 18, 2021, the Audit Committee concluded that, because of the misapplication of the accounting guidance related to the Warrants, the Company’s previously issued balance sheet as of February 11, 2021, included in the Current Report on Form 8-K filed with the SEC on February 19, 2021, should no longer be relied upon. As such, the Company is restating the balance sheet as of February 11, 2021 herein.

Subsequent to the Company’s 8-K filing on February 19, 2021, the Company identified and corrected the following errors in connection with the preparation of the balance sheet as of February 11, 2021:

		As of
		February 11, 2021
		As Reported		As Restated		Difference
Balance Sheet
Cash		$	1,991,625	$	1,991,625	$	—
Warrant proceeds receivable			846,000		846,000
Cash held in trust account			344,154,000		344,154,000		—
Total Assets		$	346,991,625	$	346,991,625	$	—

Accrued offering costs		$	54,933	$	98,052	$	43,119
Warrant liabilities			—		23,747,676		23,747,676
Deferred underwriting commission			12,075,000		12,075,000		—
Total Liabilities		$	12,129,933	$	35,920,728	$	23,790,795
Class A common stock subject to possible redemption		$	329,861,690	$	306,070,895	$	(23,790,795)
Preferred stock, $0.0001 par value			—		—		—
Class A common stock, $0.0001 par value			151		389		238
Class B common stock, $0.0001 par value			863		863		—
Additional paid-in capital			4,998,988		5,749,492		750,504
Accumulated deficit			—		(750,742)		(750,742)
Total Stockholders’ Equity			5,000,002		5,000,002		—
Total Liabilities and Stockholders’ Equity	$		346,991,625	$	346,991,625	$	—

The Company’s accounting for the warrants as components of equity instead of as derivative liabilities did not have any effect on the Company’s previously reported cash.

Cash and Cash Equivalents

The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company had $479,301 in cash and no cash equivalents, outside of the funds held in the Trust Account, as of March 31, 2021.

Warrant Liabilities

The Company accounts for the Warrants in accordance with the guidance contained in ASC 815-40 under which the Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the Warrants as liabilities at their fair value and adjusts the Warrants to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in the Company’s statement of operations. The fair value of the Public, Private and Forward Purchase Warrants has been estimated using a risk-neutral Monte Carlo simulation framework. See Note 6 for further discussion of the pertinent terms of the Warrants and Note 8 for further discussion of the methodology used to determine the value of the Warrants.

Cash and Marketable Securities Held in Trust Account

At March 31, 2021, the assets held in the Trust Account were invested in money market funds.

Common Stock Subject to Possible Redemption

The Company accounts for its common stock subject to possible redemption in accordance with the guidance in ASC Topic 480 “Distinguishing Liabilities from Equity.” Shares of common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at March 31, 2021, common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders’ equity section of the Company’s condensed balance sheet.

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to concentration of credit risk consist of a cash account in a financial institution which, at times may exceed the Federal depository insurance coverage of $250,000. At March 31, 2021, the Company had not experienced losses on this account and management believes the Company is not exposed to significant risks on such account.

Financial Instruments

Except for the Warrant Liabilities as described above, the fair value of the Company’s assets and liabilities, which qualify as financial instruments under the FASB ASC 820, “Fair Value Measurements and Disclosures,” approximates the carrying amounts represented in the condensed balance sheets.

Fair Value Measurements

Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value.

The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include:

•

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.

In some circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In those instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement.

As of March 31, 2021, the carrying values of cash, prepaid expenses, accounts payable, accrued expenses and advances from related party approximate their fair values due to the short-term nature of the instruments. The Company’s portfolio of marketable securities held in the Trust Account is comprised of money market funds. The fair value of the Public Warrants, Private Placement Warrants and Forward Purchase Warrants has been estimated using a risk-neutral Monte Carlo simulation framework. See Note 6 for further discussion of the pertinent terms of the Warrants and Note 8 for further discussion of the methodology used to determine the value of the Warrants.

Offering Costs

Offering costs consist of legal, accounting, underwriting and other costs incurred through the condensed balance sheet date that are directly related to the Initial Public Offering. Upon the completion of the Initial Public Offering in February 2021, the offering costs were allocated using the relative fair values of the company common stock and its Warrants. The costs allocated to Warrants were recognized in other expenses and those related to the Company's common stock were recognized in additional paid-in capital.

Net Earnings Per Share of Common Stock

The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share.” Net earnings per share is computed by dividing net earnings by the weighted-average number of shares of common stock outstanding during the periods.

The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of our initial Business Combination on a one-for-one basis, subject to adjustment.

The Company’s unaudited condensed statement of operations includes a presentation of net earnings per share for shares of common stock subject to redemption in a manner similar to the two-class method of income per share. Net earnings per share, basic and diluted, for the Initial Public Offering Class A redeemable shares issued on February 11, 2021, is calculated by dividing net earnings attributable to Class A redeemable shares for the quarter ended March 31, 2021, by the weighted average number of Initial Public Offering Class A redeemable outstanding shares since issuance. Net income per share, basic and diluted, for Class A and Class B non-redeemable shares for the quarter ended March 31, 2021 is calculated by dividing the net income of $8,028,639, less net earnings attributable to the Initial Public Offering Class A redeemable shares, by the weighted average number of Class A and Class B non-redeemable shares outstanding for the period. Non-redeemable shares include the Class B Founder Shares, as these shares do not have any redemption features and do not participate in the income earned on the marketable securities held in the Trust Account. The effects of the Public Warrants, Private Placement Warrants and the Forward Purchase Warrants are antidilutive and excluded from the weighted average shares calculation.

Income Taxes

The Company complies with the accounting and reporting requirements of ASC Topic 740, “Income Taxes,” which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred income tax assets and liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that will result in future taxable or deductible amounts, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

ASC Topic 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The Company’s management determined that the United States is the Company’s only major tax jurisdiction. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of March 31, 2021. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception.

The Company’s provision for income taxes and deferred tax assets were deemed to be de minimis as of March 31, 2021.

Recent Accounting Pronouncements

Management does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s condensed financial statements.