ANNUAL 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) |
(Address of principal executive offices) |
(Zip Code) |
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
SM (Stakeholder Aligned Initial Listing) securities, each consisting of one share of Class A common Stock, $0.0001 par valueone-fifth of one redeemable warrant to acquire one share of Class A Common Stock |
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SM securities |
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SM securities, each whole warrant exercisable for one share of Class A Common Stock |
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
☒ | Smaller reporting company | |||||
Emerging growth company |
PAGE |
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Item 1. |
11 |
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Item 1A. |
40 |
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Item 1B. |
81 |
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Item 2. |
81 |
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Item 3. |
81 |
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Item 4. |
81 |
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Item 5. |
82 |
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Item 6. |
82 |
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Item 7. |
83 |
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Item 7A. |
88 |
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Item 8. |
88 |
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Item 9. |
88 |
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Item 9A. |
88 |
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Item 9B. |
89 |
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Item 9C. |
89 |
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Item 10. |
90 |
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Item 11. |
100 |
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Item 12. |
101 |
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Item 13. |
104 |
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Item 14. |
106 |
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Item 15. |
108 |
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Item 16. |
109 |
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110 |
• | “Alignment Shares” are to our Class B shares issued to our sponsor and the foundation; |
• | “amended and restated certificate of incorporation” are to the amended and restated certificate of incorporation that the company adopted prior to the consummation of the Initial Public Offering; |
• | “ARCH” are to ARCH Venture Management, LLC, a Delaware limited liability company, or to ARCH Venture Fund XI, L.P., a Delaware limited partnership, as applicable; |
• | “Board” or “board of directors” are to our board of directors; |
• | “Class A shares” or “shares of Class A common stock” are to our shares of Class A common stock, par value $0.0001 per share; |
• | “Class B shares” or “shares of Class B common stock” are to our shares of Class B common stock, par value $0.0001 per share; |
• | “common stock” are to our Class A common stock and our Class B common stock; |
• | “directors” are to our current directors and director nominees; |
• | “equity-linked securities” are to any debt or equity securities that are convertible, exercisable or exchangeable for shares of our Class A common stock issued in a financing transaction in connection with our Initial Business Combination, including, but not limited to, a private placement of such securities; |
• | “Foundation” are to Health Assurance Economy Foundation, a Delaware nonprofit nonstock corporation; |
• | “General Catalyst” are to General Catalyst Partners, LLC, a Delaware limited liability company; |
• | “Initial Stockholders” are to our sponsor, the foundation and any other holders of our alignment shares immediately prior to the Initial Public Offering; |
• | “Initial Public Offering” are to the Company’s offering on March 22, 2021 of 55,000,000 Stakeholder Aligned Initial Listing securities, or SAIL SM securities (each, a “SAIL”, and collectively, “SAILs”), including 5,000,000 SAILs as a result of the underwriters’ exercise in part of their over-allotment option, sold at an offering price of $10.00 per SAIL; |
• | “Initial Public Offering Final Prospectus” are to the final prospectus to the company’s Initial Public Offering filed with the SEC on March 18, 2021; |
• | “Letter Agreement” are to the letter agreement, dated March 17, 2021, among the company, the sponsor, the foundation and each executive officer and director of the company, pursuant to which the sponsor and each executive officer and director of the company has agreed to vote any shares of Class A common stock held by him, her or it in favor of the company’s Initial Business Combination; to facilitate the liquidation and winding up of the company if an Initial Business Combination is not consummated within 24 months; to certain transfer restrictions with respect to the company’s securities; to certain indemnification obligations of the sponsor; and the company has agreed not to enter into a definitive agreement regarding an Initial Business Combination without the prior consent of the sponsor; |
• | “management” or our “management team” are to our executive officers; |
• | “Private Placement Warrants” are to the warrants issued to our sponsor in a private placement simultaneously with the closing of the Initial Public Offering and upon conversion of working capital loans, if any, which private placement warrants are identical to the warrants sold in the Initial Public Offering, subject to certain limited exceptions as described in the initial public offering final prospectus; |
• | “Public Shares” are to our shares of Class A common stock sold as part of the SAIL SM securities in the Initial Public Offering (whether they are purchased in the Initial Public Offering or thereafter in the open market); |
• | “Public Stockholders” are to the holders of our public shares, including our initial stockholders and management team to the extent our initial stockholders and/or members of our management team purchase public shares; provided that our initial stockholders’ and each member of our management team’s status as a “public stockholder” will only exist with respect to such public shares; |
• | “Sponsor” are to REV Sponsor LLC, a Delaware limited liability company; |
• | “Underwriter’s over-allotment option” are to the underwriter’s 45-day option to purchase up to an additional 7,500,000 SAILSM securities to cover over-allotments in the Initial Public Offering, which was partially exercised on March 22, 2021 resulting in the purchase of an additional 5,000,000 SAILs; |
• | “Warrants” are to our warrants sold as part of the SAIL SM securities in the Initial Public Offering (whether they are purchased in the Initial Public Offering or thereafter in the open market); and |
• | “we,” “us,” “our,” “REVH,” “RHAC,” “company” or “our company” are to Revolution Healthcare Acquisition Corp., a Delaware corporation. |
• | our ability to select an appropriate target business or businesses; |
• | our ability to complete our Initial Business Combination; |
• | our expectations around the performance of a prospective target business or businesses; |
• | our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our Initial Business Combination; |
• | our officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or in approving our Initial Business Combination; |
• | our potential ability to obtain additional financing to complete our Initial Business Combination; |
• | our pool of prospective target businesses; |
• | our ability to consummate an initial business combination due to the uncertainty resulting from the COVID-19 pandemic, including new variant strains of the underlying virus, current or anticipated military conflict, including between Russia and Ukraine, terrorism, sanctions, rising energy prices, inflation and interest rates and other geopolitical events globally; |
• | the ability of our officers and directors to generate a number of potential business combination opportunities; |
• | our public securities’ potential liquidity and trading; |
• | the lack of a market for our securities; |
• | the use of proceeds not held in the Trust Account or available to us from interest income on the Trust Account balance; |
• | the Trust Account not being subject to claims of third parties; or |
• | our financial performance following our Initial Public Offering. |
• | We are a blank check company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective. |
• | Past performance by our management team or their respective affiliates may not be indicative of future performance of an investment in us. |
• | Certain of our directors and officers are now, and all of them may in the future become, affiliated with entities engaged in business activities similar to those intended to be conducted by us and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented. |
• | Our search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected by current or anticipated military conflict, including between Russia and Ukraine, terrorism, sanctions or other geopolitical events globally, the COVID 19 coronavirus pandemic, including new variant strains of the underlying virus, and the status of debt and equity markets. |
• | The requirement that the target business or businesses that we acquire must collectively have a fair market value equal to at least 80% of the balance of the funds in the trust account (excluding any taxes payable) may limit the type and number of companies with which we may complete such a business combination. |
• | Our stockholders may not be afforded an opportunity to vote on our proposed Initial Business Combination, which means we may complete our Initial Business Combination even though a majority of our stockholders do not support such a combination. |
• | Your only opportunity to affect the investment decision regarding a potential business combination may be limited to the exercise of your right to redeem your shares from us for cash. |
• | If we seek stockholder approval of our Initial Business Combination, our initial stockholders have agreed to vote in favor of such Initial Business Combination, regardless of how our public stockholders vote. |
• | The ability of our public stockholders to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for us to enter into a business combination with a target. |
• | The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination or optimize our capital structure. |
• | The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares could increase the probability that our Initial Business Combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your shares.. |
• | The requirement that we consummate an Initial Business Combination within 24 months after the closing of our Initial Public Offering (or such later date as approved by holders of a majority of shares of our outstanding common stock that are voted at a meeting to extend such date, voting together as a single class) may give potential target businesses leverage over us in negotiating a business combination and may limit the time we have in which to conduct due diligence on potential business |
combination targets, in particular as we approach our dissolution deadline, which could undermine our ability to complete our Initial Business Combination on terms that would produce value for our stockholders. |
• | As the number of special purpose acquisition companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets. This could increase the cost of our Initial Business Combination and could even result in our inability to find a target or to consummate an Initial Business Combination. |
• | We may not be able to consummate an Initial Business Combination within 24 months of our Initial Public Offering (or such later date as approved by holders of a majority of shares of our outstanding common stock that are voted at a meeting to extend such date, voting together as a single class), in which case we would cease all operations except for the purpose of winding up and we would redeem our Public Shares and liquidate. |
• | If we seek stockholder approval of our Initial Business Combination, our initial stockholders, directors, executive officers, advisors and their affiliates may elect to purchase Public Shares or warrants, which may influence a vote on a proposed business combination and reduce the public “float” of our shares of Class A common stock or Public Warrants. |
• | If a stockholder fails to receive notice of our offer to redeem our Public Shares in connection with our Initial Business Combination, or fails to comply with the procedures for tendering its shares, such shares may not be redeemed. |
• | You will not have any rights or interests in funds from the Trust Account, except under certain limited circumstances. Therefore, to liquidate your investment, you may be forced to sell your Public Shares or warrants, potentially at a loss. |
• | Nasdaq may delist our securities from trading on its exchange, which could limit investors’ ability to make transactions in our securities and subject us to additional trading restrictions. |
• | You will not be entitled to protections normally afforded to investors of many other blank check companies. |
• | If we seek stockholder approval of our Initial Business Combination and we do not conduct redemptions pursuant to the tender offer rules, and if you or a “group” of stockholders are deemed to hold in excess of 15% of our shares of Class A common stock, you will lose the ability to redeem all such shares in excess of 15% of our shares of Class A common stock. |
• | Because of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete our Initial Business Combination. If we have not consummated our Initial Business Combination within the required time period, our public stockholders may receive only approximately $10.00 per public share, or less in certain circumstances, on the liquidation of our Trust Account and our warrants will expire worthless. |
• | If the net proceeds of the Initial Public Offering and the sale of the Private Placement Warrants not being held in the Trust Account are insufficient to allow us to operate for the 24 months following the closing of the Initial Public Offering (or such later date as approved by holders of a majority of shares of our outstanding common stock that are voted at a meeting to extend such date, voting together as a single class), it could limit the amount available to fund our search for a target business or businesses and our ability to complete our Initial Business Combination, and we will depend on loans from our Sponsor, its affiliates or members of our management team to fund our search and to complete our Initial Business Combination. |
• | Subsequent to completion of our Initial Business Combination, we may be required to take write-downs or write-offs, restructuring and impairment or other charges that could have a significant negative effect on our financial condition, results of operations and the price of our securities, which could cause you to lose some or all of your investment. |
• | If third parties bring claims against us, the proceeds held in the Trust Account could be reduced and the per-share redemption amount received by stockholders may be less than $10.00 per public share. |
• | Our directors may decide not to enforce the indemnification obligations of our Sponsor, resulting in a reduction in the amount of funds in the Trust Account available for distribution to our public stockholders. |
• | The securities in which we invest the funds held in the Trust Account could bear a negative rate of interest, which could reduce the value of the assets held in trust such that the per-share redemption amount received by public stockholders may be less than $10.00 per share. |
• | We may not have sufficient funds to satisfy indemnification claims of our directors and executive officers. |
• | If, after we distribute the proceeds in the Trust Account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, a bankruptcy court may seek to recover such proceeds, and the members of our board of directors may be viewed as having breached their fiduciary duties to our creditors, thereby exposing the members of our board of directors and us to claims of punitive damages. |
• | If, before distributing the proceeds in the Trust Account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority over the claims of our stockholders and the per-share amount that would otherwise be received by our stockholders in connection with our liquidation may be reduced. |
• | If we are deemed to be an investment company under the Investment Company Act, we may be required to institute burdensome compliance requirements and our activities may be restricted, which may make it difficult for us to complete our Initial Business Combination. |
• | Changes in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect our business, including our ability to negotiate and complete our Initial Business Combination, and results of operations. |
• | If we have not consummated an Initial Business Combination within 24 months from the closing of the Initial Public Offering (or such later date as approved by holders of a majority of shares of our outstanding common stock that are voted at a meeting to extend such date, voting together as a single class), our public stockholders may be forced to wait beyond such period before redemption from our Trust Account. |
• | Our stockholders may be held liable for claims by third parties against us to the extent of distributions received by them upon redemption of their shares. |
• | You will not be permitted to exercise your warrants unless we register and qualify the underlying shares of Class A common stock or certain exemptions are available. |
• | You may only be able to exercise your Public Warrants on a “cashless basis” under certain circumstances, and if you do so, you will receive fewer shares of Class A common stock from such exercise than if you were to exercise such warrants for cash. |
• | The grant of registration rights to our initial stockholders and holders of our Private Placement Warrants may make it more difficult to complete our Initial Business Combination, and the future exercise of such rights may adversely affect the market price of our shares of Class A common stock. |
• | Because we are neither limited to evaluating a target business in a particular industry sector nor have we selected any specific target businesses with which to pursue our Initial Business Combination, you will be unable to ascertain the merits or risks of any particular target business’s operations. |
• | We may seek acquisition opportunities in industries or sectors which may or may not be outside of our management’s area of expertise. |
• | Although we have identified general criteria and guidelines that we believe are important in evaluating prospective target businesses, we may enter into our Initial Business Combination with a target that does not meet such criteria and guidelines, and as a result, the target business with which we enter into our Initial Business Combination may not have attributes entirely consistent with our general criteria and guidelines. |
• | We are not required to obtain an opinion from an independent accounting or investment banking firm, and consequently, you may have no assurance from an independent source that the price we are paying for the business is fair to our stockholders from a financial point of view. |
• | We may issue additional shares of Class A common stock or preferred stock to complete our Initial Business Combination or under an employee incentive plan after completion of our Initial Business Combination. Any such issuances would dilute the interest of our stockholders and likely present other risks. |
• | Subsequent to the completion of our Initial Business Combination, our Alignment Shares will be eligible for conversion into shares of our Class A common stock based on the Total Return of our outstanding equity capital. Any such issuance would dilute the interest of our stockholders and likely present other risks. |
• | Resources could be wasted in researching Initial Business Combinations that are not completed, which could materially adversely affect subsequent attempts to locate and acquire or merge with another business. If we do not complete our Initial Business Combination, our public stockholders may only receive their pro rata portion of the funds in the Trust Account that are available for distribution to public stockholders, and our warrants will expire worthless.. |
• | We are dependent upon our executive officers and directors and their loss could adversely affect our ability to operate. |
• | Our ability to successfully effect our Initial Business Combination and to be successful thereafter will be totally dependent upon the efforts of our key personnel, some of whom may join us following our Initial Business Combination. The loss of key personnel could negatively impact the operations and profitability of our post-combination business. |
• | Our key personnel may negotiate employment or consulting agreements with a target business in connection with a particular business combination, and a particular business combination may be conditioned on the retention or resignation of such key personnel. These agreements may provide for them to receive compensation following our Initial Business Combination and, as a result, may cause them to have conflicts of interest in determining whether a particular business combination is the most advantageous. |
• | We may have a limited ability to assess the management of a prospective target business and, as a result, may affect our Initial Business Combination with a target business whose management may not have the skills, qualifications or abilities to manage a public company. |
• | The officers and directors of an acquisition candidate may resign upon completion of our Initial Business Combination. The loss of a business combination target’s key personnel could negatively impact the operations and profitability of our post-combination business. |
• | Our executive officers and directors will allocate their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our Initial Business Combination. |
• | Our officers and directors presently have, and any of them in the future may have, additional, fiduciary or contractual obligations to other entities, including other blank check companies or special purpose acquisition companies, including HAAC and CPAR, and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented. |
• | Involvement of members of our management and companies with which they are affiliated in civil disputes and litigation, governmental investigations or negative publicity unrelated to our business affairs could materially impact our ability to consummate an Initial Business Combination. |
• | Our executive officers, directors, security holders and their respective affiliates may have competitive pecuniary interests that conflict with our interests. |
• | We may engage in a business combination with one or more target businesses that have relationships with entities that may be affiliated with our Sponsor, executive officers, directors or initial stockholders which may raise potential conflicts of interest. |
• | A conflict of interest may arise from the need to obtain the consent of ARCH and General Catalyst, which own a significant interest in our sponsor, to our business combination. |
• | Since our initial stockholders will lose their entire investment in us if our Initial Business Combination is not completed (other than with respect to Public Shares they may acquire during or after the Initial Public Offering), a conflict of interest may arise in determining whether a particular business combination target is appropriate for our Initial Business Combination. |
• | We may issue notes or other debt securities, or otherwise incur substantial debt, to complete a business combination, which may adversely affect our leverage and financial condition and thus negatively impact the value of our stockholders’ investment in us. |
• | We may only be able to complete one business combination with the proceeds of the Initial Public Offering and the sale of the Private Placement Warrants, which will cause us to be solely dependent on a single business which may have a limited number of products or services. This lack of diversification may negatively impact our operations and profitability.. |
• | We may attempt to simultaneously complete business combinations with multiple prospective targets, which may hinder our ability to complete our Initial Business Combination and give rise to increased costs and risks that could negatively impact our operations and profitability. |
• | We may attempt to complete our Initial Business Combination with a private company about which little information is available, which may result in a business combination with a company that is not as profitable as we suspected, if at all. |
• | Our management may not be able to maintain control of a target business after our Initial Business Combination. Upon the loss of control of a target business, new management may not possess the skills, qualifications or abilities necessary to profitably operate such business. |
• | We may seek business combination opportunities with a high degree of complexity that require significant operational improvements, which could delay or prevent us from achieving our desired results. |
• | We do not have a specified maximum redemption threshold. The absence of such a redemption threshold may make it possible for us to complete our Initial Business Combination with which a substantial majority of our stockholders do not agree. |
• | In order to effectuate an Initial Business Combination, blank check companies have, in the recent past, amended various provisions of their charters and other governing instruments, including their warrant agreements. We cannot assure you that we will not seek to amend our amended and restated certificate of incorporation or governing instruments in a manner that will make it easier for us to complete our Initial Business Combination that our stockholders may not support. |
• | The provisions of our amended and restated certificate of incorporation that relate to our pre-business combination activity (and corresponding provisions of the agreement governing the release of funds from our Trust Account) may be amended with the approval of holders of at least 65% of our common stock, which is a lower amendment threshold than that of some other blank check companies. It may be easier for us, therefore, to amend our amended and restated certificate of |
incorporation to facilitate the completion of an Initial Business Combination that some of our stockholders may not support. |
• | Certain agreements related to the Initial Public Offering may be amended without stockholder approval. |
• | We may be unable to obtain additional financing to complete our Initial Business Combination or to fund the operations and growth of a target business, which could compel us to restructure or abandon a particular business combination. If we do not complete our Initial Business Combination, our public stockholders may only receive their pro rata portion of the funds in the Trust Account that are available for distribution to public stockholders, and our warrants will expire worthless. |
• | Our initial stockholders control a substantial interest in us and thus may exert a substantial influence on actions requiring a stockholder vote, potentially in a manner that you do not support. |
• | Our initial stockholders contributed $25,000, or approximately $0.001 per Alignment share, and, accordingly, holders of our Class A common stock have experienced substantial dilution and may experience further substantial dilution. |
• | We may amend the terms of the warrants in a manner that may be adverse to holders of Public Warrants. As a result, the exercise price of your warrants could be increased, the exercise period could be shortened and the number of shares of Class A common stock purchasable upon exercise of a warrant could be decreased, all without your approval. |
• | We may redeem your unexpired warrants prior to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless. |
• | Our warrants may have an adverse effect on the market price of our shares of Class A common stock and make it more difficult to effectuate our Initial Business Combination. |
• | Because each SAIL SM security contains one-fifth of one redeemable warrant and only a whole warrant may be exercised, the SAILSM securities may be worth less than units of other blank check companies. |
• | A provision of our warrant agreement may make it more difficult for us to consummate an Initial Business Combination. |
• | The determination of the offering price of our SAIL SM securities and the size of the Initial Public Offering was more arbitrary than the pricing of securities and size of an offering of an operating company in a particular industry. You may have less assurance, therefore, that the offering price of our SAILSM securities properly reflects the value of such SAILSM securities than you would have in a typical offering of an operating company. |
• | Because we must furnish our stockholders with target business financial statements, we may lose the ability to complete an otherwise advantageous Initial Business Combination with some prospective target businesses. |
• | We are an emerging growth company and a smaller reporting company within the meaning of the Securities Act, and if we take advantage of certain exemptions from disclosure requirements available to “emerging growth companies” or “smaller reporting companies,” this could make our securities less attractive to investors and may make it more difficult to compare our performance with other public companies. |
• | Compliance obligations under the Sarbanes-Oxley Act may make it more difficult for us to effectuate a business combination, require substantial financial and management resources, and increase the time and costs of completing an acquisition. |
• | Provisions in our amended and restated certificate of incorporation may inhibit a takeover of us, which could limit the price investors might be willing to pay in the future for our shares of Class A common stock and could entrench management. |
• | Provisions in our amended and restated certificate of incorporation and Delaware law may have the effect of discouraging lawsuits against our directors and officers. |
• | Our warrant agreement designates the courts of the State of New York or the United States District Court for the Southern District of New York as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by holders of our warrants, which could limit the ability of warrant holders to obtain a favorable judicial forum for disputes with our company. |
• | Cyber incidents or attacks directed at us could result in information theft, data corruption, operational disruption and/or financial loss. |
• | Since only holders of our Alignment Shares will have the right to vote on the election of directors, Nasdaq may consider us to be a “controlled company” within the meaning of the Nasdaq rules and, as a result, we may qualify for exemptions from certain corporate governance requirements. |
• | An investment in us may result in uncertain or adverse U.S. federal income tax consequences. |
• | If we effect our Initial Business Combination with a company located outside of the United States, we would be subject to a variety of additional risks that may adversely affect us. |
• | We are subject to changing law and regulations regarding regulatory matters, corporate governance and public disclosure that have increased both our costs and the risk of non-compliance. |
• | In our Quarterly Report on Form 10-Q filed May 24, 2021, our Amendment No. 1 to Quarterly Report on Form 10-Q filed January 13, 2022 and this Annual Report on Form 10-K, we reached determinations to restate certain previously issued financial statements to correct the accounting treatment for the Company’s securities. |
• | We identified a material weakness in our internal control over financial reporting. If we are unable to develop and maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results in a timely manner, which may adversely affect investor confidence in us and materially and adversely affect our business and operating results. |
• | We may face litigation and other risks as a result of the material weakness in our internal control over financial reporting. |
• | The other risks and uncertainties discussed in “Risk Factors” and elsewhere in this Annual Report on Form 10-K. |
Item 1. |
Business |
• | Pioneers in patient-centric health care delivery |
• | Cross-industry, cross-disciplinary talent |
• | Experience building platforms at the cutting edge of technology and life sciences |
• | Experts in unscaled health care at scale |
• | Deep networks |
• | Impressive track record |
• | Mission-driven, principled |
• | sitting at the intersection between technology, health care and life sciences, including patient-centric, data-driven, cloud-based platforms; |
• | that has the potential to change the health care system to benefit the patient (built with empathy, cuts down costs, and prioritizes personalization and patient outcomes); |
• | where we can materially impact the value and growth of the company in partnership with management; |
• | address disease areas that are ripe for disruption due to dismal patient experience (e.g., mental health and well-being, home based care); |
• | close to our proximal networks of founders, operators, investors, and advisors; and |
• | where we have a differentiated view on the ability of the target to create value as a public company. |
• | partnership with our management team members who have extensive track records of founding, operating, advising, and investing in market-leading health care, life sciences and technology companies; |
• | access to our network of leading industry executives, entrepreneurs, and investors; |
• | increase company presence and visibility with strategic partners, customers, employers, payors, and vendors; |
• | higher engagement with core, relevant, fundamental investors as anchor stockholders than a traditional IPO book-building process would offer; |
• | lower risk and expedited path to a public listing with flexible structuring; |
• | infusion of cash and ongoing access to public capital markets; |
• | listed public currency for future acquisitions and growth; |
• | ability for management to retain control and focus on growing the business; and |
• | opportunity to motivate and retain employees using stock-based compensation. |
• | subject us to negative economic, competitive and regulatory developments, any or all of which may have a substantial adverse impact on the particular industry in which we operate after our Initial Business Combination; and |
• | cause us to depend on the marketing and sale of a single product or limited number of products or services. |
• | we issue common stock that will be equal to or in excess of 20% of the number of our common stock then-outstanding (other than in a public offering); |
• | any of our directors, officers or substantial security holder (as defined by the Nasdaq rules) has a 5% or greater interest, directly or indirectly, in the target business or assets to be acquired or otherwise and the present or potential issuance of common stock could result in an increase in issued and outstanding common stock or voting power of 1% or more (or 5% or more if the related party involved is classified as such solely because such person is a substantial security holder); or |
• | the issuance or potential issuance of common stock will result in our undergoing a change of control. |
• | the timing of the transaction, including in the event we determine stockholder approval would require additional time and there is either not enough time to seek stockholder approval or doing so would place the company at a disadvantage in the transaction or result in other additional burdens on the company; |
• | the expected cost of holding a stockholder vote; |
• | the risk that the stockholders would fail to approve the proposed business combination; |
• | other time and budget constraints of the company; and |
• | additional legal complexities of a proposed business combination that would be time-consuming and burdensome to present to stockholders. |
• | conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and |
• | file proxy materials with the SEC. |
• | conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers; and |
• | file tender offer documents with the SEC prior to completing our Initial Business Combination which contain substantially the same financial and other information about the Initial Business Combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. |
Item 1A. |
Risk Factors |
• | a limited availability of market quotations for our securities; |
• | reduced liquidity for our securities; |
• | a determination that our Class A common stock are a “penny stock” which will require brokers trading in our Class A common stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities; |
• | a limited amount of news and analyst coverage; and |
• | a decreased ability to issue additional securities or obtain additional financing in the future. |
• | restrictions on the nature of our investments; and |
• | restrictions on the issuance of securities, each of which may make it difficult for us to complete our Initial Business Combination. |
• | registration as an investment company with the SEC; |
• | adoption of a specific form of corporate structure; and |
• | reporting, record keeping, voting, proxy and disclosure requirements and other rules and regulations that we are currently not subject to. |
• | may significantly dilute the equity interest of investors in our Initial Public Offering (which dilutive effect would increase as the price of our Class A common stock increases on a year-over-year basis, in respect of shares issued upon conversion of the alignment shares); |
• | may subordinate the rights of holders of shares of Class A common stock if shares of preferred stock are issued with rights senior to those afforded shares of our Class A common stock; |
• | could cause a change in control if a substantial number of shares of Class A common stock is issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers and directors; and |
• | may adversely affect prevailing market prices for our SAIL SM securities, shares of Class A common stock and/or warrants. |
• | default and foreclosure on our assets if our operating revenues after an Initial Business Combination are insufficient to repay our debt obligations; |
• | acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant; |
• | our immediate payment of all principal and accrued interest, if any, if the debt is payable on demand; |
• | our inability to obtain necessary additional financing if the debt contains covenants restricting our ability to obtain such financing while the debt is outstanding; |
• | our inability to pay dividends on our shares of Class A common stock; |
• | using a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends on our shares of Class A common stock if declared, expenses, capital expenditures, acquisitions and other general corporate purposes; |
• | limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate; |
• | increased vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation; and |
• | limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, execution of our strategy and other purposes and other disadvantages compared to our competitors who have less debt. |
• | solely dependent upon the performance of a single business, property or asset; or |
• | dependent upon the development or market acceptance of a single or limited number of products, processes or services. |
• | the history and prospects of companies whose principal business is the acquisition of other companies; |
• | prior offerings of those companies; |
• | our prospects for acquiring an operating business at attractive values; |
• | a review of debt-to-equity |
• | our capital structure; |
• | an assessment of our management and their experience in identifying operating companies; |
• | general conditions of the securities markets at the time of our Initial Public Offering; and |
• | other factors as were deemed relevant. |
• | we have a board that includes a majority of “independent directors,” as defined under the rules of Nasdaq; |
• | we have a compensation committee of our board that is comprised entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and |
• | we have a nominating and corporate governance committee of our board that is comprised entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities. |
• | costs and difficulties inherent in managing cross-border business operations; |
• | rules and regulations regarding currency redemption; |
• | complex corporate withholding taxes on individuals; |
• | laws governing the manner in which future business combinations may be effected; |
• | exchange listing and/or delisting requirements; |
• | tariffs and trade barriers; |
• | regulations related to customs and import/export matters; |
• | local or regional economic policies and market conditions; |
• | unexpected changes in regulatory requirements; |
• | longer payment cycles; |
• | tax issues, such as tax law changes and variations in tax laws as compared to the United States; |
• | currency fluctuations and exchange controls; |
• | rates of inflation; |
• | challenges in collecting accounts receivable; |
• | cultural and language differences; |
• | employment regulations; |
• | underdeveloped or unpredictable legal or regulatory systems; |
• | corruption; |
• | protection of intellectual property; |
• | social unrest, crime, strikes, riots and civil disturbances; |
• | regime changes and political upheaval; |
• | terrorist attacks, natural disasters and wars; and |
• | deterioration of political relations with the United States. |
Item 1B. |
Unresolved Staff Comments |
Item 2. |
Properties |
Item 3. |
Legal Proceedings |
Item 4. |
Mine Safety Disclosures |
Item 5. |
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities (a) Market Information |
Item 6. |
Reserved. |
Item 7. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
Item 7A. |
Quantitative and Qualitative Disclosures About Market Risk. |
Item 8. |
Financial Statements and Supplementary Data. |
Item 9. |
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure |
Item 9A. |
Controls and Procedures |
Item 9B. |
Other Information |
Item 9C. |
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections. |
Name |
Age |
Position | ||||
Jay Markowitz, M.D. |
59 | Chief Executive Officer and Director | ||||
Mark McDonnell |
53 | Chief Financial Officer | ||||
Jason Doren |
52 | Chief Administrative Officer | ||||
Paul Fielding |
35 | Chief Operating Officer | ||||
Jeff Leiden, M.D., Ph.D. |
66 | Chairman | ||||
Kris Engskov |
50 | Director | ||||
Catherine Friedman |
61 | Director | ||||
Robert Nelsen |
58 | Director | ||||
Jennifer Schneider, M.D. |
46 | Director | ||||
Hemant Taneja |
46 | Director |
• | meeting with our independent registered public accounting firm regarding, among other issues, audits, and adequacy of our accounting and control systems; |
• | monitoring the independence of the independent registered public accounting firm; |
• | verifying the rotation of the lead (or coordinating) audit partner having primary responsibility for the audit and the audit partner responsible for reviewing the audit as required by law; |
• | inquiring and discussing with management our compliance with applicable laws and regulations; |
• | pre-approving all audit services and permitted non-audit services to be performed by our independent registered public accounting firm, including the fees and terms of the services to be performed; |
• | appointing or replacing the independent registered public accounting firm; |
• | determining the compensation and oversight of the work of the independent registered public accounting firm (including resolution of disagreements between management and the independent auditor regarding financial reporting) for the purpose of preparing or issuing an audit report or related work; |
• | establishing procedures for the receipt, retention and treatment of complaints received by us regarding accounting, internal accounting controls or reports which raise material issues regarding our financial statements or accounting policies; |
• | monitoring compliance on a quarterly basis with the terms of our Initial Public Offering and, if any noncompliance is identified, immediately taking all action necessary to rectify such noncompliance or otherwise causing compliance with the terms of our Initial Public Offering; and |
• | reviewing and approving all payments made to our existing stockholders, executive officers or directors and their respective affiliates. Any payments made to members of our audit committee will be reviewed and approved by our board of directors, with the interested director or directors abstaining from such review and approval. |
• | should have demonstrated notable or significant achievements in business, education or public service; |
• | should possess the requisite intelligence, education and experience to make a significant contribution to the board of directors and bring a range of skills, diverse perspectives and backgrounds to its deliberations; and |
• | should have the highest ethical standards, a strong sense of professionalism and intense dedication to serving the interests of the stockholders. |
• | reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officer’s compensation, |