The table below presents a reconciliation of the numerator and denominator used to compute basic and diluted net loss per share of common stock for each class of common stock:
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For the three months ended March 31, |
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Basic and diluted net loss per common share: |
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Allocation of net loss |
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$ |
8,895,052 |
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$ |
2,223,763 |
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$ |
(50,699 |
) |
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Basic and diluted weighted average common shares outstanding |
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29,900,000 |
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7,475,000 |
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5,625,000 |
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Basic and diluted net loss per common share |
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$ |
0.30 |
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$ |
0.30 |
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$ |
(0.01 |
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Recent Accounting Pronouncements
Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed financial statements.
Note 3—Initial Public Offering
On November 8, 2021, the Company consummated its Initial Public Offering of 29,900,000 Units, including 3,900,000 Over-Allotment Units, at $10.00 per Unit, generating gross proceeds of $299.0 million, and incurring offering costs of approximately $17.3 million, of which approximately $10.5 million and approximately $560,000 was for deferred underwriting commissions and offering costs allocated to derivative warrant liabilities, respectively.
Each Unit consists of one share of Class A common stock
and one-half of
one redeemable warrant (“Public Warrant”). Each whole Public Warrant will entitle the holder to purchase one share of Class A common stock at a price of $11.50 per share, subject to adjustment (see Note 6).
Note 4—Related Party Transactions
On January 21, 2021, the Sponsor paid $25,000 on behalf of the Company to cover certain offering costs in exchange for issuance of 8,625,000 Founder Shares. On February 4, 2021, the Company effected a forward stock split that increased the number of Founder Shares held by the Sponsor from 8,625,000 to 11,500,000. On July 12, 2021, the Sponsor surrendered, for no consideration, an aggregate of 5,031,250 Founder Shares, which the Company canceled, resulting in an aggregate of 6,468,750 Founder Shares outstanding. Immediately prior to the consummation of the Initial Public Offering, the Company effected a stock dividend with respect to the Company’s Class B common stock, resulting in an aggregate of 7,475,000 shares of Class B common stock outstanding. The Founder Shares included an aggregate of up 975,000 shares subject to forfeiture to the extent that the underwriters’ option to purchase additional Units was not exercised in full or in part, so that the Company’s initial Stockholders would own, on
an as-converted basis,
20% of the Company’s issued and outstanding shares after the Initial Public Offering. The underwriters exercised their over-allotment option in full on November 8, 2021; thus, these 975,000 Founder Shares were no longer subject to forfeiture.
In March and April 2021, the Sponsor transferred 35,000 Founder Shares to each of the Company’s independent directors and to Darius Adamczyk, one of the advisors. The transfer of the Founder Shares is in the scope of FASB ASC Topic 718, “Compensation-Stock Compensation” (“ASC 718”). Under ASC 718, stock-based compensation associated with equity-classified awards is measured at fair value upon the grant date. The Founders Shares were granted subject to a performance condition (i.e., the occurrence of a Business Combination). Compensation expense related to the Founders Shares is recognized only when the performance condition is probable of occurrence under the applicable accounting literature in this circumstance. As of March 31, 2022, the Company determined that a Business Combination is not considered probable, and, therefore, no stock-based compensation expense has been recognized. Stock-based compensation would be recognized at the date a Business Combination is considered probable (i.e., upon consummation of a Business Combination) in an amount equal to the number of Founders Shares that ultimately vest multiplied times the grant date fair value per share (unless subsequently modified).
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