The statements in the discussion and analysis regarding industry outlook, our expectations regarding the performance of our business and the forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, the risks and uncertainties described in "Risk Factors" and "Cautionary Note Regarding Forward-Looking Statements." Our actual results may differ materially from those contained in or implied by any forward-looking statements. You should read the following discussion together with the sections entitled "Risk Factors"," "Business" and the audited financial statements, including the related notes, appearing elsewhere in this Annual Report. All references to years, unless otherwise noted, refer to our fiscal years, which end on December 31.

Overview

We are a blank check company formed under the laws of the State of Delaware on August 24, 2020, for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or other similar business combination with one or more businesses. We intend to effectuate our business combination using cash from the proceeds of the initial public offering and the sale of the private placement warrants, our capital stock, debt or a combination of cash, stock and debt.

We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to raise capital or to complete our initial business combination will be successful.

Results of Operations



We have neither engaged in any operations nor generated any revenues to date.
Our only activities through December 31, 2020 were organizational activities,
those necessary to prepare for the Initial Public Offering, described below,
and, after our Initial Public Offering, identifying a target company for a
business combination. We do not expect to generate any operating revenues until
after the completion of our business combination. We generate
non-operating
income in the form of interest income on marketable securities held in the trust
account, along with
non-operating
income or expense related to the change in fair value of the warrant liabilities
and the Convertible Note. We incur expenses as a result of being a public
company (for legal, financial reporting, accounting and auditing compliance), as
well as for due diligence expenses.

For the year ended December 31, 2021, we had a net income of $19,323,177, which consists of interest earned on marketable securities held in the trust account of $155,704, unrealized gain on marketable securities held in the trust account of $5,765, change in fair value of convertible promissory note - related party of $60,511 and change in fair value of warrant liabilities of $20,935,690, partially offset by formation and operational costs of $1,834,493.

For the period from August 24, 2020 (inception) through December 31, 2020, we had a net loss of $10,661,113, which consists of formation and operational costs of $81,585, transaction costs incurred in connection with IPO of $1,069,399, change in fair value of warrant liabilities of $8,629,500, and fair value of warrant liability in excess of proceeds received in private placement of $890,000, offset by interest income - bank of $1, interest earned on marketable securities held in the trust account of $5,916 and an unrealized gain on marketable securities held in our trust account of $3,454.

Liquidity and Capital Resources

On December 22, 2020, we consummated the initial public offering of 34,500,000 units, at $10.00 per unit, which included the full exercise by the underwriters of their over-allotment option in the amount of 4,500,000 units, generating gross proceeds of $345,000,000. Simultaneously with the closing of the initial public offering, we consummated the sale of 8,900,000 private placement warrants to the Sponsor at a price of $1.00 per warrant, generating gross proceeds of $8,900,000.


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Following the initial public offering, the full exercise of the over-allotment option, and the sale of the private placement warrants, a total of $345,000,000 was placed in the trust account. We incurred $19,606,206 in transaction costs, including $6,900,000 of underwriting fees, net of reimbursement, $12,075,000 of deferred underwriting fees and $631,206 of other offering costs.

For the year ended December 31, 2021, net cash used in operating activities was $1,299,101. Net income of $19,323,177 was affected by the change in fair value of warrant liabilities of $20,935,690, change in fair value of convertible promissory note - related party of $60,511, interest earned on marketable securities held in trust account of $155,704 and an unrealized gain on marketable securities held in trust account of $5,765. Changes in operating assets and liabilities provided $535,392 of cash from operating activities.

For the period from August 24, 2020 (inception) through December 31, 2020, cash used in operating activities was $553,424. Net loss of $10,661,113 was affected by interest earned on marketable securities held in trust account of $5,916, an unrealized gain on marketable securities held in trust account $3,454, transaction costs incurred in connection with initial public offering of $1,069,399, fair value of warrant liability in excess of proceeds received in private placement of $890,000 and change in fair value of warrant liabilities of $8,629,500. Changes in operating assets and liabilities used $471,840 of cash from operating activities.

For the year ended December 31, 2021, net cash provided by financing activities was $320,111 as a result of the drawdowns on the Convertible Note.

For the period from August 24, 2020 (inception) through December 31, 2020, net cash used in investing activities was $345,000,000 as a result of the investment of cash into the trust account. Net cash provided by financing activities for the same period was $346,544,294 inclusive of $25,000 and $338,100,000 as a result of proceeds from the issuance of Class B common stock to the Sponsor and proceeds from the sale of units, respectively. Net cash was also influenced by $8,900,000 provided by the sale of Private Placement Warrants and partially offset by the payment of offering costs of $480,706.

At December 31, 2021 we had cash and marketable securities held in the trust account of $345,170,839 consisting of U.S. Treasury Bills with a maturity of 185 days or less. Interest income on the balance in the trust account may be used by us to pay taxes. Through December 31, 2021, we have not withdrawn any interest earned from the trust account.

We intend to use substantially all of the funds held in the trust account, including any amounts representing interest earned on the trust account (less deferred underwriting commissions and income taxes payable), to complete our business combination. To the extent that our capital stock or debt is used, in whole or in part, as consideration to complete our business combination, the remaining proceeds held in the Trust Account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.

At December 31, 2021, we had cash of $11,880 outside of the trust account and accounts payable and accrued expenses of $258,427. We intend to use the funds held outside the trust account primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, and structure, negotiate and complete a business combination.

In order to fund working capital deficiencies or finance transaction costs in connection with a business combination, the Sponsor or an affiliate of the Sponsor or certain of our directors and officers may, but are not obligated to, lend us funds as may be required. If we complete a business combination, we would repay such lent amounts. In the event that a business combination does not close, we may use a portion of the working capital held outside the trust account to repay such lent amounts but no proceeds from our trust account would be used for such repayment. On September 13, 2021, the Sponsor agreed to lend us an aggregate of up to $1,000,000 pursuant to the Convertible Note (as defined below) for working capital purposes. We had drawn an aggregate of $320,111 under the Convertible Note as of December 31, 2021, leaving $679,889 available to us. We subsequently drew down an additional $150,000 on the Convertible Note on January 31, 2022 bringing the total balance withdrawn on the Convertible Note to $470,111, leaving $529,889 available to us. Up to $1,500,000 of loans made by the Sponsor or an affiliate of the Sponsor or certain of our directors and officers (including pursuant to the Convertible Note) may be convertible into warrants identical to the private placement warrants, at a price of $1.00 per warrant at the option of the lender.


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Going Concern

As of December 31, 2021, we had $11,880 in our operating bank accounts, $345,170,839 in marketable securities held in the trust account to be used for a business combination or to repurchase or redeem its stock in connection therewith and working capital of $91,547, which excludes franchise taxes payable of $143,219 and $56,830 of franchise taxes paid and not yet reimbursed from the trust account. As of December 31, 2021, approximately $170,839 of the amount on deposit in the trust account represented interest income, which is available to pay our tax obligations.

We may raise additional capital through loans or additional investments from the Sponsor or an affiliate of the Sponsor or certain of our directors and officers. The Sponsor may but is not obligated to (except as described below), loan us funds, from time to time in whatever amounts it deems reasonable in its sole discretion, to meet out working capital needs. On September 13, 2021, the Sponsor agreed to lend us an aggregate of up to $1,000,000 for working capital purposes pursuant to the Convertible Note. We had drawn an aggregate of $320,111 under the Convertible Note as of December 31, 2021, leaving $679,889 available to us. We subsequently drew down an additional $150,000 on the Convertible Note on January 31, 2022 bringing the total balance withdrawn on the Convertible Note to $470,111, leaving $529,889 available to us. There can be no assurance that we will be able to obtain additional financing, however. Moreover, we may need to obtain additional financing either to complete our business combination or because we become obligated to redeem a significant number of our public shares upon consummation of our business combination, in which case we may issue additional securities or incur debt in connection with such business combination. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our business combination.

If we are unable to raise additional capital, we may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending the pursuit of a potential transaction and reducing overhead expenses. We cannot provide any assurance that new financing will be available to us on commercially acceptable terms, if at all.

In connection with our assessment of going concern considerations in accordance with ASC Topic 205-40 Presentation of Financial Statements - Going Concern, pursuant to our Amended and Restated Certificate of Incorporation, we have until December 22, 2022 to consummate a business combination. If a business combination is not consummated by this date, or our stockholders have not approved an extension, there will be a mandatory liquidation and subsequent dissolution of the Company. Although we intend to consummate a business combination on or before December 22, 2022, and may seek an extension, it is uncertain that we will be able to consummate a business combination, or obtain an extension, by this time. This, as well as our liquidity condition, raise substantial doubt about our ability to continue as a going concern. No adjustments have been made to the carrying amounts of assets or liabilities should we be required to liquidate after December 22, 2022.



Off-Balance
Sheet Arrangements

We did not have any
off-balance
sheet arrangements as of December 31, 2021.

Contractual Obligations

We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities, other than an agreement to pay an affiliate of the Sponsor a monthly fee of $10,000 for certain administrative, research, transaction and other support services. We began incurring these fees on December 22, 2020 and will continue to incur these fees monthly until the earlier of the completion of the business combination and our liquidation. In addition, for the three and twelve months ended December 31, 2021, the Company reimbursed such affiliate of the Sponsor for certain costs incurred on the Company's behalf in the amounts of $9,313 and $108,476, respectively which are included in general and administrative expenses in the accompanying condensed statement of operations.


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The underwriters are entitled to a deferred fee of $0.35 per Unit, or $12,075,000 in the aggregate. The deferred fee will become payable to the underwriters from the amounts held in the trust account solely in the event that we complete a business combination, subject to the terms of the underwriting agreement.

Critical Accounting Policies

The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates. Our critical accounting policies are presented below:

Warrant Liabilities and Convertible Note - Related Party



We account for warrants as either equity-classified or liability-classified
instruments based on an assessment of the warrant's specific terms and
applicable authoritative guidance in Financial Accounting Standards Board
("FASB") Accounting Standards Codification ("ASC") 480, Distinguishing
Liabilities from Equity ("ASC 480") and ASC 815, Derivatives and Hedging ("ASC
815"). The assessment considers whether the warrants are freestanding financial
instruments pursuant to ASC 480, meet the definition of a liability pursuant to
ASC 480, and whether the warrants meet all of the requirements for equity
classification under ASC 815, including whether the warrants are indexed to our
own Class A common stock, among other conditions for equity classification. This
assessment, which requires the use of professional judgment, is conducted at the
time of warrant issuance and as of each subsequent quarterly period end date
while the warrants are outstanding. The Company accounts for its Convertible
Note under ASC 815, Derivatives and Hedging ("ASC 815"). Under
815-15-25,
the election can be at the inception of a financial instrument to account for
the instrument under the fair value option under ASC 825. The Company has made
such election for its Convertible Note. Using fair value option, the Convertible
Note is required to be recorded at its initial fair value on the date of
issuance, and each balance sheet date thereafter. Changes in the estimated fair
value of the note are recognized as
non-cash
change in the fair value of the Convertible Note in the statements of
operations. The fair value of the option to convert into private warrants was
valued utilizing the closed-form model.

For issued or modified warrants that meet all of the criteria for equity
classification, the warrants are required to be recorded as a component of
additional
paid-in
capital at the time of issuance. For issued or modified warrants that do not
meet all the criteria for equity classification, the warrants are required to be
recorded at their initial fair value on the date of issuance, and each balance
sheet date thereafter. Changes in the estimated fair value of the warrants are
recognized as a
non-cash
gain or loss on the statements of operations.

Class A Common Stock Subject to Possible Redemption

We account for our shares of Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification ("ASC") Topic 480 "Distinguishing Liabilities from Equity." Shares of Class A common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control) is classified as temporary equity. At all other times, common stock is classified as stockholders' equity. Our common stock features certain redemption rights that are considered to be outside of our control and subject to occurrence of uncertain future events. Accordingly, all of the Class A common stock subject to possible redemption is presented as temporary equity, outside of the stockholders' deficit section of our balance sheets.

Net Income (Loss) per Common Share

The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, "Earnings Per Share". Net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of common shares outstanding for the period. The Company applies the two-class method in calculating income (loss) per common share. Re-measurement associated with the redeemable shares of Class A common stock is excluded from income (loss) per common share as the redemption value approximates fair value.

The calculation of diluted income (loss) per common share does not consider the effect of the warrants issued in connection with the (i) Initial Public Offering, and (ii) the private placement since the exercise of the warrants is contingent upon the occurrence of future events, and (iii) any warrants that could be acquired through conversion of convertible debt. As of December 31, 2021, there are currently 34,500,000 shares of Class A common stock in the aggregate which does not include the warrants that could be issued as a result of the conversion option in the Convertible Note. As of December 31, 2021 and 2020, the Company did not have any dilutive securities or other contracts that could, potentially, be exercised or converted into common stock and then share in the earnings of the Company. As a result, diluted net income (loss) per common share is the same as basic net income (loss) per common share for the periods presented.


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Recent Accounting Standards



In August 2020, the FASB issued Accounting Standards Update ("ASU")
2020-06-
"Contracts in Entity's Own Equity (Subtopic
815-40)
("ASU
2020-06")",to
simplify accounting for certain financial instruments ASU
2020-06
eliminates the current models that require separation of beneficial conversion
and cash conversion features from convertible instruments and simplifies the
derivative scope exception guidance pertaining to equity classification of
contracts in an entity's own equity. The new standard also introduces additional
disclosures for convertible debt and freestanding instruments that are indexed
to and settled in an entity's own equity. ASU
2020-06
amends the diluted earnings per share guidance, including the requirement to use
the
if-converted
method for all convertible instruments. ASU
2020-06
is effective for fiscal years beginning after December 15, 2023, including
interim periods within those fiscal years with early adoption permitted. We are
currently assessing the impact, if any, that ASU
2020-06
would have on its financial position, results of operations or cash flows.

Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on our financial statements.

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