Delaware
|
6531
|
85-2800538
|
||
(State or other jurisdiction of
incorporation or organization) |
(Primary Standard Industrial
Classification Code Number)
|
(I.R.S. Employer
Identification No.) |
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
Non-accelerated
filer
|
☒ | Smaller reporting company | ☐ | |||
Emerging growth company | ☒ |
|
||||||||
Title of Each Class of
Securities to be Registered
|
|
Amount
to be
Registered(1)
|
|
Proposed
Maximum
Offering Price
Per Share
|
|
Proposed
Maximum
Aggregate
Offering Price
|
|
Amount of
Registration Fee
|
Class A common stock, par value $0.0001 per share
|
|
21,783,304(2)
|
|
$11.50(3)
|
|
$250,507,996.00
|
|
$27,330.43
|
Class A common stock, par value $0.0001 per share
|
|
237,268,350(4)
|
|
$10.74(5)
|
|
$2,548,262,079.00
|
|
$278,015.39
|
Warrants to purchase Class A common stock
|
|
8,366,667
|
|
—
|
|
—
|
|
—(6)
|
Total
|
|
|
|
|
|
$2,798,770,075.00
|
|
$305,345.82
|
|
||||||||
|
(1)
|
Pursuant to Rule 416 under the Securities Act (as defined below), this registration statement also covers any additional number of shares of Class A common stock (as defined below) issuable upon stock splits, stock dividends or other distribution, recapitalization or similar events with respect to the shares of Class A common stock being registered pursuant to this registration statement.
|
(2)
|
Consists of 21,783,304 shares of Class A common stock issuable upon the exercise of 21,783,304 warrants by the holders thereof.
|
(3)
|
The price per share is based upon the exercise price per warrant of $11.50 per share.
|
(4)
|
Represents the sum of (a) 233,993,391 shares of Class A common stock outstanding or issuable upon exercise of outstanding warrants or options being registered for resale by stockholders of the Company and (b) 3,274,959 shares of Class A common stock issuable by the Company upon the exercise of options to purchase Class A common stock.
|
(5)
|
Pursuant to Rule 457(c) under the Securities Act, and solely for the purpose of calculating the registration fee, the proposed maximum offering price per share is $10.74, which is the average of the high and low prices of the Class A common stock on NYSE (as defined below) on September 23, 2021.
|
(6)
|
In accordance with Rule 457(g), the entire registration fee for the warrants registered hereby is allocated to the shares of Class A common stock underlying the warrants, and no separate fee is payable for the warrants.
|
• |
its ability to respond to general economic conditions;
|
• |
the health of the U.S. residential real estate industry;
|
• |
its ability to grow market share in its existing markets or any new markets it may enter;
|
• |
the impact of the
COVID-19
pandemic;
|
• |
its ability to manage its growth effectively;
|
• |
its ability to accurately value and manage inventory, and to maintain an adequate and desirable supply of inventory;
|
• |
its ability to successfully launch new product and service offerings, and to manage, develop and refine its technology platform;
|
• |
its ability to maintain and enhance its products and brand, and to attract customers;
|
• |
its ability to achieve and maintain profitability in the future; and
|
• |
the success of strategic relationships with third parties.
|
• |
Our business and operating results may be significantly impacted by a number of factors, including general economic conditions, local or regional conditions in the markets in which we operate, the health of the U.S. residential real estate industry and governmental actions that impact us, risks associated with our real estate assets and
the COVID-19 pandemic
and attempts to contain it;
|
• |
Our limited operating history makes it difficult to evaluate our current business and future prospects and the risk of your investment;
|
• |
We operate in a competitive and fragmented industry, and we may not be successful in attracting customers for our products and services or in competing effectively through management of our products or services, including home renovations, which could harm our business, results of operations and financial condition;
|
• |
We have experienced rapid growth since inception, which may not be indicative of future growth, and, if we continue to grow rapidly, we may experience difficulties in managing our growth and expanding our operations and service offerings;
|
• |
Our business model and growth strategy depend on our marketing efforts and ability to maintain our brand and attract customers to our platform in a cost-effective manner;
|
• |
We may be unsuccessful in launching or marketing new products or services, or launching existing products and services into new markets, or may be unable to successfully integrate new offerings into our existing platform, which would result in significant expense and may not achieve desired results;
|
• |
We have a history of losses since inception, and we may not achieve or maintain profitability in the future;
|
• |
Our business is dependent upon our ability to acquire, accurately value and manage inventory and any decrease in availability of inventory, an ineffective pricing or portfolio management strategy, inaccurate information from prospective sellers or buyers with respect to their homes or ineffective home inspections may have an adverse effect on our business, sales and results of operations;
|
• |
Prospective sellers and buyers of homes may choose not to transact online, which could harm our growth prospects;
|
• |
Our internal information technology systems may fail or suffer security breaches, loss or leakage of data, and other disruptions, which could disrupt our business or result in the loss of critical and confidential information;
|
• |
We process, store and use personal information and other data, which subjects us to governmental regulation and other legal obligations related to privacy, and violation of these privacy obligations could result in a claim for damages, regulatory action, loss of business, or unfavorable publicity;
|
• |
Our ability to compete depends in part on protecting our intellectual property and other propriety information and on maintaining necessary intellectual property licenses;
|
• |
We operate in a highly regulated industry and are subject to a wide range of federal, state and local laws, rules and regulations, including licensing and conduct requirements relating to our real estate brokers and brokerage-related businesses and mortgage products;
|
• |
We utilize a significant amount of indebtedness in the operation of our business, and so our cash flows and operating results could be adversely affected by required payments of debt or related interest and other risks of our debt financing;
|
• |
We rely on agreements with third parties to finance our business; and
|
• |
We face risks relating to our capital structure, including the potential impact of our multi-class structure.
|
• |
not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended (the “Sarbanes-Oxley Act”);
|
• |
not being required to comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis);
|
• |
reduced disclosure obligations regarding executive compensation in our periodic reports, proxy statements and registration statements; and
|
• |
exemptions from the requirements of holding a nonbinding advisory vote of stockholders on executive compensation, stockholder approval of any golden parachute payments not previously approved and having to disclose the ratio of the compensation of our chief executive officer to the median compensation of our employees.
|
Shares of Class A Common Stock offered by us
|
25,058,263 shares issuable upon exercise of Warrants and options. |
Shares of Class A Common Stock offered by the Selling Securityholders
|
233,993,391 shares. |
Shares of Class A Common Stock outstanding
|
223,528,935 shares (as of September 22, 2021). |
Shares of Class B Common Stock outstanding
|
14,816,236 shares (as of September 22, 2021). |
Warrants offered by the Selling Securityholders
|
8,366,667 Warrants. |
Warrants outstanding
|
21,783,304 Warrants (as of September 22, 2021). |
Exercise price per share pursuant to the Warrants
|
$11.50 |
Use of proceeds
|
We will not receive any proceeds from the sale of shares by the Selling Securityholders. We will receive the proceeds from any exercise of the Warrants and options for cash, which we intend to use for general corporate and working capital purposes. See “
Use of Proceeds
|
Risk factors
|
You should carefully read the “Risk Factors” beginning on page 8 and the other information included in this prospectus for a discussion of factors you should consider carefully before deciding to invest in our Class A Common Stock or Warrants. |
NYSE symbol for our Class A Common Stock
|
“OPAD” |
NYSE symbol for our Warrants
|
“OPAD WS” |
• |
downturns in the U.S. residential real estate market — both seasonal and cyclical — in particular with respect to the single family home resale market and the markets in which we operate;
|
• |
changes in national, regional, or local economic, demographic or real estate market conditions;
|
• |
the continuing and future impact of the
COVID-19
pandemic, including with respect to buying and selling trends in the residential real estate market and potential governmental or regulatory changes or requirements;
|
• |
slow economic growth or recessionary or inflationary conditions;
|
• |
increased levels of unemployment or declining wages;
|
• |
declines in the value of residential real estate or the pace of home appreciation, or the lack thereof;
|
• |
illiquidity in residential real estate;
|
• |
overall conditions in the housing market, including macroeconomic shifts in demand, and increases in costs for homeowners such as property taxes, homeowners’ association fees and insurance costs;
|
• |
low levels of consumer confidence in the economy in general or the U.S. residential real estate industry in particular;
|
• |
low home inventory levels or lack of affordably priced homes;
|
• |
increased mortgage interest rates or down payment requirements or restrictions on mortgage financing availability;
|
• |
changes in household debt levels;
|
• |
volatility and general declines in the stock market;
|
• |
federal, state, or local legislative or regulatory changes that would negatively impact owners or potential purchasers of single family homes or the residential real estate industry in general, such as the Tax Cuts and Jobs Act of 2017 (the “
Tax Act
|
• |
natural disasters, such as hurricanes, windstorms, tornadoes, earthquakes, wildfires, floods, hailstorms and other events that disrupt local, regional, or national real estate markets.
|
• |
the financial competitiveness of our products for customers;
|
• |
the volume of our customers;
|
• |
the timing and market acceptance of our products, including iBuying, and new products offered by us or our competitors;
|
• |
our selling and marketing efforts;
|
• |
our customer service and support efforts;
|
• |
our continued ability to develop and improve our technology to support our business model;
|
• |
customer adoption of our platform as an alternative to traditional methods of buying and selling residential real estate; and
|
• |
our brand strength relative to our competitors.
|
• |
increased unemployment rates and stagnant or declining wages;
|
• |
decreased consumer confidence in the economy and recessionary conditions;
|
• |
volatility and declines in the stock market and lower yields on individuals’ investment portfolios; and
|
• |
more stringent mortgage financing conditions, including increased down payment requirements.
|
• |
increase the number of customers using our platform;
|
• |
acquire sufficient inventory at an attractive cost and quality to meet the increasing demand for our homes;
|
• |
successfully turn inventory in an efficient manner;
|
• |
increase customer conversion;
|
• |
increase our market share within existing markets and expand into new markets;
|
• |
increase our brand awareness;
|
• |
obtain and retain adequate availability of financing sources; and
|
• |
obtain necessary capital to meet our business objectives.
|
• |
our inability to grow market share in our existing markets or any new markets we may enter;
|
• |
our expansion into new markets;
|
• |
declines in U.S. residential real estate transaction volumes;
|
• |
increased competition in the U.S. residential real estate industry;
|
• |
changes in our fee structure or rates;
|
• |
our failure to accurately price homes we acquire or changes to resale prices during the time homes are in inventory;
|
• |
our failure to realize anticipated efficiencies through our technology and business model;
|
• |
costs associated with enhancements, or new offerings of our products and services;
|
• |
failure to execute our growth strategies;
|
• |
increased marketing costs;
|
• |
lack of access to housing market data that is used in our pricing models at reasonable cost;
|
• |
hiring additional personnel to support our overall growth;
|
• |
loss in value of real estate or potential impairments in the value of our assets due to changes in market conditions in the area in which real estate or assets are located;
|
• |
increases in costs associated with holding our real estate inventories, including financing costs;
|
• |
the availability of debt financing and securitization funding to finance our real estate inventories; and
|
• |
unforeseen expenses, difficulties, complications and delays, and other unknown factors.
|
• |
authorize Class B common stock that entitle Brian Bair, our Chief Executive Officer and founder, to 10 votes per share of such stock until the Sunset Date;
|
• |
provide for a classified board of directors with staggered, three-year terms;
|
• |
permit our board of directors to issue shares of preferred stock, including “blank check” preferred stock and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquirer;
|
• |
prohibit cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates;
|
• |
limit the liability of, and provide for the indemnification of, our directors and officers;
|
• |
permit our board of directors to amend the bylaws, which may allow our board of directors to take additional actions to prevent an unsolicited takeover and inhibit the ability of an acquirer to amend the bylaws to facilitate an unsolicited takeover attempt;
|
• |
require a supermajority vote of stockholders to amend certain provisions of the Charter and a supermajority vote of stockholders in order to amend the Bylaws;
|
• |
limit our ability to engage in business combinations with certain interested stockholders without certain approvals; and
|
• |
mandate advance notice procedures with which stockholders must comply in order to nominate candidates to our board of directors or to propose matters to be acted upon at a stockholders’ meeting, which could preclude stockholders from bringing matters before annual or special meetings of stockholders and delay changes in our board of directors and also may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of our company.
|
• |
your proportionate ownership interest in our company will decrease;
|
• |
the relative voting strength of each previously outstanding share of our
|
• |
the market price of our shares may decline.
|
• |
you may not be able to liquidate your investment in our securities;
|
• |
you may not be able to resell your securities at or above the price at which you acquired them;
|
• |
the market price of shares of our securities may experience significant price volatility; and
|
• |
there may be less efficiency in carrying out your purchase and sale orders.
|
• |
actual or anticipated fluctuations in our quarterly financial results or the quarterly financial results of companies perceived to be similar to ours;
|
• |
changes in the market’s expectations about our operating results;
|
• |
the public’s reaction to our press releases, other public announcements and filings with the SEC;
|
• |
speculation in the press or investment community;
|
• |
actual or anticipated developments in our business, competitors’ businesses or the competitive landscape generally;
|
• |
the operating results failing to meet the expectation of securities analysts or investors in a particular period;
|
• |
changes in financial estimates and recommendations by securities analysts concerning us or the market in general;
|
• |
operating and stock price performance of other companies that investors deem comparable to ours;
|
• |
changes in laws and regulations affecting Offerpad Solutions’s business;
|
• |
commencement of, or involvement in, litigation involving Offerpad Solutions;
|
• |
changes in our capital structure, such as future issuances of securities or the incurrence of additional debt;
|
• |
the volume of our Class A Common Stock available for public sale;
|
• |
any major change in our board of directors or management;
|
• |
sales of substantial amounts of our Class A Common Stock by our directors, officers or significant stockholders or the perception that such sales could occur;
|
• |
general economic and political conditions such as recessions, interest rates, “trade wars,” pandemics (such as
COVID-19)
and acts of war or terrorism; and
|
• |
other risk factors listed under “
Risk Factors.
|
• |
the (a) historical audited financial statements of SPNV as of December 31, 2020 and for the period from August 31, 2020 (inception) to December 31, 2020 and (b) historical unaudited condensed financial statements of SPNV as of and for the six months ended June 30, 2021; and
|
• |
the (a) historical audited consolidated financial statements of Old Offerpad as of and for the year ended December 31, 2020 and (b) historical unaudited condensed consolidated financial statements of Old Offerpad as of and for the six months ended June 30, 2021.
|
• |
former Old Offerpad stockholders having the largest voting interest in Offerpad Solutions;
|
• |
the board of directors of Offerpad Solutions having 7 members, and Old Offerpad’s former stockholders having the ability to nominate the majority of the members of the board of directors;
|
• |
Old Offerpad management continuing to hold executive management roles for the post-combination company and being responsible for the
day-to-day
|
• |
the post-combination company assuming the Offerpad name;
|
• |
Offerpad Solutions maintaining the
pre-existing
Offerpad headquarters; and
|
• |
the intended strategy of Offerpad Solutions being a continuation of Old Offerpad’s strategy.
|
Pro Forma Combined
|
||||||||
Stockholder
|
Number of
Shares |
Percentage
of Outstanding Shares |
||||||
Former Old Offerpad equityholders(1)(2)
|
224,881,802 | 85.4 | % | |||||
SPNV sponsor and related parties(3)
|
15,062,500 | 5.7 | % | |||||
Former SPNV Class A stockholders
|
3,387,913 | 1.3 | % | |||||
PIPE Investors
|
20,000,000 | 7.6 | % | |||||
Total shares of Offerpad Solutions common stock outstanding at closing of the transaction(1)(2)(4)
|
263,332,215 | 100 | % |
(1) |
Amount includes 14,816,236 shares of Class B common stock of Offerpad Solutions issued to Brian Bair, the Chief Executive Officer and Founder of the Company, or entities controlled by Mr. Bair, which entitle the holders to 10 votes per share until the earlier of (a) the date that is nine months following the date on which Mr. Bair (x) is no longer providing services, whether upon death, resignation, removal or otherwise, to Offerpad Solutions as a member of the senior leadership team, officer or director and (y) has not provided any such services for the duration of such nine-month period; and (b) the date as of which Mr. Bair or his permitted transferees have transferred, in the aggregate, more than seventy-five (75%) of the shares of Class B common stock that were held by Mr. Bair and his permitted transferees immediately following the Closing.
|
(2) |
Amount presents shares on a fully diluted, net exercise basis. The actual number of outstanding shares of Offerpad Solutions common stock issued to former Old Offerpad equity holders at Closing was 199,894,758 shares.
|
(3) |
Amount includes 10,062,500 shares of Class A Common Stock issued upon conversion of outstanding Class B common stock of SPNV, of which 8,058,050 shares were vested as of the Closing and 2,004,450 shares are unvested as of the Closing, and 5,000,000 shares of Class A Common Stock purchased by affiliates of SPNV pursuant to forward purchase agreements entered into in connection with the closing SPNV’s initial public offering (“SPNV Forward Purchase Agreements”).
|
(4) |
Stockholders will experience additional dilution to the extent Offerpad Solutions issues additional shares after the Closing. The tables above do not include (i) up to 13,416,640 shares of Offerpad Solutions Class A common stock that will be issuable upon exercise of the public warrants at an exercise price of $11.50 per share, (ii) up to 8,366,667 shares of Offerpad Solutions Class A common stock that will be issuable upon exercise of the private placement warrants and warrants to be purchased as part of the SPNV Forward Purchase at an exercise price of $11.50 per share, (iii) shares of Offerpad Solutions Class A common stock that are initially available for issuance under the 2021 Plan or (iv) shares of Offerpad Solutions Class A common stock that are initially available for issuance under the ESPP. The following table illustrates the impact on relative ownership levels assuming the issuance of all such shares.
|
Number of
Shares |
Percentage
of Outstanding Shares |
|||||||
Total shares of Offerpad Solutions common stock outstanding at closing of the transaction
|
263,332,215 | 83.8 | % | |||||
Shares underlying public warrants
|
13,416,637 | 4.3 | % | |||||
Shares underlying private placement and SPNV Forward purchase warrants
|
8,366,667 | 2.7 | % | |||||
Shares initially reserved for issuance under 2021 Plan(a)
|
26,333,222 | 8.4 | % | |||||
Shares initially reserved for issuance under ESPP(a)
|
2,633,322 | 0.8 | % | |||||
Total
|
314,082,066 | 100 | % |
(a) |
The number of shares of Offerpad Solutions Class A common stock available for issuance under the 2021 Plan and the ESPP will be annually increased on January 1 of each calendar year beginning in 2022 and ending in 2031 by amounts described in this prospectus.
|
Offerpad
(Historical) |
SPNV
(Historical) |
Pro Forma
Adjustments |
Pro Forma
Combined |
|||||||||||||||||
ASSETS
|
||||||||||||||||||||
Current Assets:
|
||||||||||||||||||||
Cash and cash equivalents
|
$ | 44,560 | $ | 283 | $ | 402,685 |
|
A
|
|
$ | 234,984 | |||||||||
200,000 |
|
B
|
|
— | ||||||||||||||||
50,000 |
|
C
|
|
— | ||||||||||||||||
(14,088 | ) |
|
D
|
|
— | |||||||||||||||
(36,062 | ) |
|
E
|
|
— | |||||||||||||||
(5,204 | ) |
|
F
|
|
— | |||||||||||||||
(368,795 | ) |
|
K
|
|
— | |||||||||||||||
25,000 |
|
M
|
|
— | ||||||||||||||||
(63,395 | ) |
|
L
|
|
— | |||||||||||||||
Restricted cash
|
13,341 | — | — | 13,341 | ||||||||||||||||
Due from related party
|
— | 8 | — | 8 | ||||||||||||||||
Accounts receivable
|
7,117 | — | — | 7,117 | ||||||||||||||||
Inventory
|
482,860 | — | — | 482,860 | ||||||||||||||||
Prepaid expenses and other current assets
|
13,217 | 280 | (7,468 | ) |
|
E
|
|
6,029 | ||||||||||||
Total current assets
|
561,095 | 571 | 182,673 | 744,339 | ||||||||||||||||
Property and equipment, net
|
12,110 | — | — | 12,110 | ||||||||||||||||
Other
non-current
assets
|
122 | — | — | 122 | ||||||||||||||||
Investments held in Trust Account
|
— | 402,685 | (402,685 | ) |
|
A
|
|
— | ||||||||||||
TOTAL ASSETS
|
$ | 573,327 | $ | 403,256 | $ | (220,012 | ) | $ | 756,571 |
Offerpad
(Historical) |
SPNV
(Historical) |
Pro Forma
Adjustments |
Pro Forma
Combined |
|||||||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||||||||||||||
Current Liabilities:
|
||||||||||||||||||||
Accounts payable
|
$ | 5,302 | $ | 187 | $ | (187 | ) |
|
F
|
|
$ | 5,302 | ||||||||
Accrued liabilities
|
26,606 | 4,821 | (4,821 | ) |
|
F
|
|
15,755 | ||||||||||||
900 |
|
N
|
|
— | ||||||||||||||||
(910 | ) |
|
L
|
|
— | |||||||||||||||
(10,841 | ) |
|
E
|
|
— | |||||||||||||||
Due to related party
|
— | 21 | (21 | ) |
|
F
|
|
— | ||||||||||||
Income tax payable
|
— | 7 | — | 7 | ||||||||||||||||
Franchise tax payable
|
— | 75 | (75 | ) |
|
F
|
|
— | ||||||||||||
Secured credit facilities and notes payable, net - related party
|
255,344 | — | 25,000 |
|
M
|
|
222,920 | |||||||||||||
(57,424 | ) |
|
L
|
|
— | |||||||||||||||
Secured credit facilities and notes payable
|
234,508 | — | (5,061 | ) |
|
L
|
|
229,447 | ||||||||||||
Total current liabilities
|
521,760 | 5,111 | (53,440 | ) | 473,431 | |||||||||||||||
Deferred legal fees
|
— | 100 | (100 | ) |
|
F
|
|
— | ||||||||||||
Deferred underwriting commissions
|
— | 14,088 | (14,088 | ) |
|
D
|
|
— | ||||||||||||
Derivative liabilities
|
— | 33,264 | 33,264 | |||||||||||||||||
Total liabilities
|
521,760 | 52,563 | (67,628 | ) | 506,695 | |||||||||||||||
Commitments and Contingencies
|
||||||||||||||||||||
Class A common stock, $0.0001 par value; 34,569 shares subject to possible redemption at $10.00 per share
|
— | 345,693 | (345,693 | ) |
|
G
|
|
— | ||||||||||||
Temporary Equity:
|
||||||||||||||||||||
Series A convertible preferred stock, 2,789 shares authorized and 2,775 shares issued and outstanding; liquidation preference of $15,099
|
14,921 | — | (14,921 | ) |
|
H
|
|
— | ||||||||||||
Series
A-1
convertible preferred stock, 1,448 shares authorized, issued and outstanding; liquidation preference of $7,500
|
7,470 | — | (7,470 | ) |
|
H
|
|
— | ||||||||||||
Series
A-2
convertible preferred stock, 1,105 shares authorized, issued and outstanding; liquidation preference of $7,500
|
7,463 | — | (7,463 | ) |
|
H
|
|
— | ||||||||||||
Series B convertible preferred stock, 7,751 shares authorized, issued and outstanding; liquidation preference of $50,000
|
49,845 | — | (49,845 | ) |
|
H
|
|
— | ||||||||||||
Series C convertible preferred stock, 7,529 shares authorized; 5,308 shares issued and outstanding; liquidation preference of $105,750
|
104,424 | — | (104,424 | ) |
|
H
|
|
— |
Offerpad
(Historical) |
SPNV
(Historical) |
Pro Forma
Adjustments |
Pro Forma
Combined |
|||||||||||||||||
Stockholders’ Equity:
|
||||||||||||||||||||
Common stock, 34,077 shares authorized; $0.00001 par value; 7,920 issued and outstanding
|
— | — | — |
|
H
|
|
— | |||||||||||||
Preferred stock, $0.0001 par value; 1,000 shares authorized; none issued and outstanding
|
— | — | — | — | ||||||||||||||||
Class A common stock, $0.0001 par value; 100,000 shares authorized; 5,681 shares issued and outstanding (excluding 34,569 shares subject to possible redemption)
|
— | 1 | (1 | ) |
|
G
|
|
— | ||||||||||||
Class B common stock, $0.0001 par value; 20,000 shares authorized; 10,063 shares issued and outstanding
|
— | 1 | (1 | ) |
|
I
|
|
— | ||||||||||||
Common Stock
|
— | — | 2 |
|
B
|
|
27 | |||||||||||||
1 |
|
C
|
|
— | ||||||||||||||||
4 |
|
G
|
|
— | ||||||||||||||||
23 |
|
H
|
|
— | ||||||||||||||||
1 |
|
I
|
|
— | ||||||||||||||||
(4 | ) |
|
K
|
|
— | |||||||||||||||
Treasury stock
|
(10,650 | ) | — | 10,650 |
|
H
|
|
— | ||||||||||||
Additional paid in capital
|
7,653 | 19,568 | 199,998 |
|
B
|
|
380,308 | |||||||||||||
49,999 |
|
C
|
|
— | ||||||||||||||||
345,690 |
|
G
|
|
— | ||||||||||||||||
173,450 |
|
H
|
|
— | ||||||||||||||||
(9,926 | ) |
|
J
|
|
— | |||||||||||||||
(37,333 | ) |
|
E
|
|
— | |||||||||||||||
(368,791 | ) |
|
K
|
|
— | |||||||||||||||
Accumulated deficit
|
(129,559 | ) | (14,570 | ) | 4,644 |
|
E
|
|
(130,459 | ) | ||||||||||
9,926 |
|
J
|
|
— | ||||||||||||||||
— | ||||||||||||||||||||
(900 | ) |
|
N
|
|
— | |||||||||||||||
Total stockholders’ equity
|
51,567 | 350,693 | (152,384 | ) | 249,876 | |||||||||||||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
|
573,327 | 403,256 | (220,012 | ) | 756,571 |
Year Ended
December 31, 2020 |
For the
Period from August 31, 2020 (inception) through December 31, 2020 |
Pro Forma
Adjustments |
Pro Forma
Combined |
|||||||||||||||||
Offerpad
(Historical) |
SPNV
(Historical) |
|||||||||||||||||||
Revenue
|
$ | 1,064,257 | $ | — | $ | — | $ | 1,064,257 | ||||||||||||
Cost of revenue
|
976,478 | — | — | 976,478 | ||||||||||||||||
Gross profit
|
87,779 | — | — | 87,779 | ||||||||||||||||
Operating expenses:
|
||||||||||||||||||||
Sales, marketing, and operating
|
76,786 | — | — | 76,786 | ||||||||||||||||
General and administrative
|
17,481 | 229 | 61 |
|
AA
|
|
17,771 | |||||||||||||
Franchise tax expenses
|
— | 61 | (61 | ) |
|
AA
|
|
— | ||||||||||||
Technology and development
|
7,270 | — | — | 7,270 | ||||||||||||||||
Total operating expenses
|
101,537 | 290 | — | 101,827 | ||||||||||||||||
Loss from operations
|
(13,758 | ) | (290 | ) | — | (14,048 | ) | |||||||||||||
Interest expense
|
(10,031 | ) | — | — | (10,031 | ) | ||||||||||||||
Change in fair value of derivative liabilities
|
— | (24,193 | ) | (24,193 | ) | |||||||||||||||
Financing costs - derivative liabilities
|
— | (971 | ) | — | (971 | ) | ||||||||||||||
Net gain on investments held in Trust Account
|
— | 79 | (79 | ) |
|
CC
|
|
— | ||||||||||||
Other income, net
|
834 | — | — | 834 | ||||||||||||||||
Total other expense, net
|
(9,197 | ) | (25,085 | ) | (79 | ) | (34,361 | ) | ||||||||||||
Loss before income taxes
|
(22,955 | ) | (25,375 | ) | (79 | ) | (48,409 | ) | ||||||||||||
Income tax expense
|
(163 | ) | (5 | ) | — |
|
DD
|
|
(168 | ) | ||||||||||
Net loss
|
$ | (23,118 | ) | $ | (25,381 | ) | $ | (79 | ) | $ | (48,577 | ) | ||||||||
Weighted-average shares outstanding of common stock - basic
|
7,682 | 48,124 | 236,957 | |||||||||||||||||
Weighted-average shares outstanding of common stock - diluted
|
7,682 | 48,124 | 236,957 | |||||||||||||||||
Basic net loss per share
|
(3.01 | ) | (0.53 | ) | (0.21 | ) | ||||||||||||||
Diluted net loss per share
|
(3.01 | ) | (0.53 | ) | (0.21 | ) |
Offerpad
(Historical) |
SPNV
(Historical) |
Pro Forma
Adjustments |
Pro Forma
Combined |
|||||||||||||||||
Revenue
|
$ | 662,619 | $ | — | $ | — | $ | 662,619 | ||||||||||||
Cost of revenue
|
578,218 | — | — | 578,218 | ||||||||||||||||
Gross profit
|
84,401 | — | — | 84,401 | ||||||||||||||||
Operating expenses:
|
||||||||||||||||||||
Sales, marketing, and operating
|
56,671 | — | — | 56,671 | ||||||||||||||||
General and administrative
|
9,871 | 5,605 | 99 |
|
AA
|
|
15,575 | |||||||||||||
(4,644 | ) |
|
BB
|
|
(4,644 | ) | ||||||||||||||
Franchise tax expenses
|
— | 99 | (99 | ) |
|
AA
|
|
— | ||||||||||||
Technology and development
|
4,886 | — | — | 4,886 | ||||||||||||||||
Total operating expenses
|
71,428 | 5,704 | (4,644 | ) | 72,488 | |||||||||||||||
Income (loss) from operations
|
12,973 | (5,704 | ) | 4,644 | 11,913 | |||||||||||||||
Interest expense
|
(4,175 | ) | — | — | (4,175 | ) | ||||||||||||||
Change in fair value of derivative liabilities
|
— | 16,410 | 16,410 | |||||||||||||||||
Net gain on investments held in Trust Account
|
— | 107 | (107 | ) |
|
CC
|
|
— | ||||||||||||
Other income, net
|
248 | — | — | 248 | ||||||||||||||||
Total other income (expense)
|
(3,927 | ) | 16,517 | (107 | ) | 12,483 | ||||||||||||||
Net Income (loss) before income taxes
|
9,046 | 10,813 | 4,537 | 24,396 | ||||||||||||||||
Income tax expense
|
(89 | ) | (2 | ) | — |
|
DD
|
|
(91 | ) | ||||||||||
Net income (loss)
|
$ | 8,957 | $ | 10,811 | $ | 4,537 | $ | 24,305 | ||||||||||||
Weighted-average shares outstanding of common stock - basic
|
7,830 | 50,313 | 237,782 | |||||||||||||||||
Weighted-average shares outstanding of common stock – diluted
|
29,748 | 50,313 | 262,842 | |||||||||||||||||
Basic net income per share
|
1.14 | 0.21 | 0.10 | |||||||||||||||||
Diluted net income per share
|
0.30 | 0.21 | 0.09 |
(A) |
Reflects the reclassification of $402.7 million of cash and cash equivalents held in the trust account at the balance sheet date that became available to fund expenses in connection with the Business Combination or future cash needs of post-combination company.
|
(B) |
Represents the net proceeds from the private placement of 20,000,000 shares of Offerpad Solutions Class A Common Stock at $10.00 per share pursuant to the PIPE investment.
|
(C) |
Represents the net proceeds from the issuance and sale of 5,000,000 shares of Offerpad Solutions Class A Common Stock at $10.00 per share pursuant to the SPNV Forward Purchase Agreements.
|
(D) |
Represents the payment of $14.1 million of deferred underwriters’ fees. The fees were paid at Closing out of the monies in the trust account.
|
(E) |
Represents transaction costs in consummating the Business Combination and related transactions. Such transaction costs were recorded in additional paid in capital. Classification of transaction costs is as follows:
|
(in thousands)
|
Amount
|
|||
Costs related to issuance of equity
|
||||
Offerpad
|
||||
Amounts previously capitalized and paid
|
1,271 | |||
Amounts previously capitalized and not paid
|
6,197 | |||
Amounts expected as part of the Transaction
|
9,742 | |||
Subtotal
|
17,210 | |||
SPNV
|
||||
Amounts previously incurred but not paid
|
4,644 | |||
Amounts expected as part of the Transaction
|
15,479 | |||
Subtotal
|
20,123 | |||
Grand Total
|
|
37,333
|
|
(F) |
Reflects the settlement of SPNV’s historical liabilities that were settled prior to the consummation of the Business Combination and thus are not part of the post-combination company.
|
(G) |
Reflects the reclassification of approximately $345.7 million of SPNV Class A common stock subject to possible redemption to permanent equity.
|
(H) |
Represents recapitalization of Offerpad equity and issuance of 224.9 million shares of the post-combination company’s Offerpad Solutions common stock to former Offerpad equityholders as consideration for the reverse recapitalization.
|
(I) |
Reflects the conversion of SPNV Class B common stock held by the initial stockholders of SPNV to SPNV Class A common stock. Pursuant to the terms of the current SPNV certificate of incorporation, all shares of SPNV Class B common stock outstanding prior to the Closing were converted into shares of SPNV Class A common stock at the Closing. All of the shares of SPNV Class B common stock converted into SPNV Class A common stock are no longer outstanding, and each holder of such shares of SPNV Class B common stock no longer has any rights with respect to such securities.
|
(J) |
Reflects the reclassification of SPNV’s adjusted Accumulated deficit.
|
(K) |
Reflects the actual redemption of 36,862,087 public shares for aggregate redemption payments of $368.8 million allocated to Class A Common Stock and additional
paid-in
capital using par value of $0.0001 per share and at a redemption price of $10.00 per share.
|
(L) |
Reflects debt repayments, inclusive of accrued but unpaid interest, made at the Closing.
|
(M) |
Reflects secured term loan proceeds received in August 2021 which were subsequently repaid at Closing.
|
(N) |
Reflects interest incurred after 6/30/21 for debt instruments that were repaid at the Closing.
|
AA |
Reclassification of SPNV franchise tax expenses to general and administrative to conform with Offerpad presentation.
|
BB |
Elimination of
non-recurring
transaction expenses incurred in connection with the Business Combination.
|
CC |
Elimination of interest income on the trust account.
|
DD |
Does not reflect an adjustment to income tax expense as a result of the pro forma adjustments as Offerpad has historically been in a net loss position and has therefore recorded no income tax expense.
|
(in thousands, except per share amounts)
|
For the
Year
Ended December 31, 2020 |
For the Six
Months Ended June 30, 2021 |
||||||
Pro forma net (loss) income
|
$ | (48,577 | ) | $ | 24,305 | |||
Weighted-average shares outstanding of common stock – basic
|
236,957 | 237,782 | ||||||
Weighted-average shares outstanding of common stock – diluted
|
236,957 | 262,842 | ||||||
Basic net (loss) income per share
|
$ | (0.21 | ) | $ | 0.10 | |||
Diluted net (loss) income per share
|
$ | (0.21 | ) | $ | 0.09 |
• |
A total of 21,783,307 warrants sold during the SPNV IPO and concurrent private placement and pursuant to the SPNV Forward Purchase Agreements, which are exercisable at $11.50 per share; and
|
• |
27,214,749 Old Offerpad options outstanding as of December 31, 2020, of which 10,474,396 were vested and 16,740,353 were unvested. Quantities assume a 7.533 : 1 conversion rate.
|
June 30,
|
December 31,
|
|||||||||||||||
(in whole numbers) |
2021
|
2020
|
2019
|
2018
|
||||||||||||
Number of markets (at period end)
|
16 | 14 | 12 | 10 |
• |
Offerpad Flex
|
• |
Concierge Listing Service:
|
• |
Buying Service:
in-house
agents— to assist with purchasing a new home.
|
• |
Offerpad Home Loans (“OPHL”):
in-house
mortgage solutions through OPHL, our online joint venture whereby our joint venture partner would underwrite and fund the loans originated by OPHL. Currently, we provide access to mortgage solutions through a preferred provider and we are transitioning to a more traditional brokerage model which will be through a wholly owned subsidiary.
|
• |
Title and Escrow:
|
• |
continued optimization of acquisition, renovation, and resale processes, as we expand our market footprint and increase penetration in existing markets;
|
• |
effectively increasing our Flex business alongside the Express business, optimizing customer engagement and increasing conversion of requests for home purchases; and
|
• |
introducing and scaling additional ancillary services to complement our core Express and Flex products.
|
• |
We are able to manage our portfolio risk in part by our ability to manage holding periods for our inventory. Traditionally resale housing pricing moves gradually through cycles; therefore, shorter
|
inventory holding periods limit pricing exposure. As we have increased our scale and improved our workflow optimization, our average inventory holding period of homes sold improved from 138 days in 2016 to 95 days in both 2019 and 2020, reducing our pricing risk from holding aged inventory.
|
• |
Our underwriting tools are constantly updated with inputs from third party data sources, proprietary data sources as well as internal data to adjust to the latest market conditions. This limits pricing exposure to homes previously acquired and not under contract to be resold. Typically, a large portion of our inventory is under contract to be sold at any given time.
|
• |
Our listed homes are in market-ready and
move-in
ready condition following the repairs and renovations we conduct.
|
Three Months Ended
June 30, |
Six Months Ended
June 30, |
Year Ended December 31,
|
||||||||||||||||||||||||||
(in thousands, except percentages
and homes sold, unaudited)
|
2021
|
2020
|
2021
|
2020
|
2020
|
2019
|
2018
|
|||||||||||||||||||||
Gross profit (GAAP)
|
$
|
50,864
|
|
$
|
17,861
|
|
$
|
84,401
|
|
$
|
42,759
|
|
$
|
87,779
|
|
$
|
74,387
|
|
$
|
65,861
|
|
|||||||
Gross margin
|
|
13.4
|
%
|
|
6.2
|
%
|
|
12.7
|
%
|
|
6.5
|
%
|
|
8.2
|
%
|
|
6.9
|
%
|
|
7.7
|
%
|
|||||||
Homes sold
|
|
1,259
|
|
|
1,166
|
|
|
2,277
|
|
|
2,683
|
|
|
4,281
|
|
|
4,680
|
|
|
3,666
|
|
|||||||
Gross profit per home sold
|
|
40.4
|
|
|
15.3
|
|
|
37.1
|
|
|
15.9
|
|
|
20.5
|
|
|
15.9
|
|
|
18.0
|
|
|||||||
Adjustments:
|
||||||||||||||||||||||||||||
Inventory impairment - current period (1)
|
177 | 311 | 189 | 421 | 160 | 842 | 2,272 | |||||||||||||||||||||
Inventory impairment - prior period (2)
|
(95 | ) | (1,696 | ) | (142 | ) | (833 | ) | (842 | ) | (2,271 | ) | (2,535 | ) | ||||||||||||||
Interest expense capitalized (3)
|
767 | 920 | 1,373 | 2,140 | 2,962 | 6,769 | 6,194 | |||||||||||||||||||||
Adjusted gross profit
|
|
51,713
|
|
|
17,396
|
|
|
85,821
|
|
|
44,487
|
|
|
90,059
|
|
|
79,727
|
|
|
71,791
|
|
|||||||
Adjusted gross margin
|
|
13.7
|
%
|
|
6.1
|
%
|
|
13.0
|
%
|
|
6.8
|
%
|
|
8.5
|
%
|
|
7.4
|
%
|
|
8.4
|
%
|
|||||||
Adjustments:
|
||||||||||||||||||||||||||||
Direct selling costs (4)
|
(8,787 | ) | (8,853 | ) | (16,823 | ) | (19,298 | ) | (30,878 | ) | (29,989 | ) | (23,418 | ) | ||||||||||||||
Holding costs on sales - current period (5)(6)
|
(533 | ) | (865 | ) | (1,161 | ) | (2,954 | ) | (4,419 | ) | (3,709 | ) | (6,779 | ) | ||||||||||||||
Holding costs on sales - prior period (5)(7)
|
(188 | ) | (1,147 | ) | (214 | ) | (1,352 | ) | (1,393 | ) | (1,249 | ) | (1,167 | ) | ||||||||||||||
Other income (8)
|
7 | 269 | 248 | 498 | 834 | — | — | |||||||||||||||||||||
Contribution profit
|
|
42,212
|
|
|
6,800
|
|
|
67,871
|
|
|
21,381
|
|
|
54,203
|
|
|
44,780
|
|
|
40,428
|
|
|||||||
Contribution margin
|
|
11.1
|
%
|
|
2.4
|
%
|
|
10.2
|
%
|
|
3.3
|
%
|
|
5.1
|
%
|
|
4.2
|
%
|
|
4.7
|
%
|
|||||||
Homes sold
|
|
1,259
|
|
|
1,166
|
|
|
2,277
|
|
|
2,683
|
|
|
4,281
|
|
|
4,680
|
|
|
3,666
|
|
|||||||
Contribution profit per home sold
|
|
33.5
|
|
|
5.8
|
|
|
29.8
|
|
|
8.0
|
|
|
12.7
|
|
|
9.6
|
|
|
11.0
|
|
|||||||
Adjustments:
|
||||||||||||||||||||||||||||
Interest expense capitalized (3)
|
(767 | ) | (920 | ) | (1,373 | ) | (2,140 | ) | (2,962 | ) | (6,769 | ) | (6,194 | ) | ||||||||||||||
Interest expense on homes sold - current period (9)
|
(1,345 | ) | (1,506 | ) | (2,826 | ) | (5,709 | ) | (8,500 | ) | (12,940 | ) | (14,547 | ) | ||||||||||||||
Interest expense on homes sold - prior period (10)
|
(386 | ) | (2,697 | ) | (468 | ) | (4,067 | ) | (4,169 | ) | (2,324 | ) | (2,174 | ) | ||||||||||||||
Contribution profit after interest
|
|
39,714
|
|
|
1,677
|
|
|
63,204
|
|
|
9,465
|
|
|
38,572
|
|
|
22,746
|
|
|
17,512
|
|
|||||||
Contribution margin after interest
|
|
10.5
|
%
|
|
0.6
|
%
|
|
9.5
|
%
|
|
1.4
|
%
|
|
3.6
|
%
|
|
2.1
|
%
|
|
2.0
|
%
|
|||||||
Homes sold
|
|
1,259
|
|
|
1,166
|
|
|
2,277
|
|
|
2,683
|
|
|
4,281
|
|
|
4,680
|
|
|
3,666
|
|
|||||||
Contribution profit after interest per home sold
|
|
31.5
|
|
|
1.4
|
|
|
27.8
|
|
|
3.5
|
|
|
9.0
|
|
|
4.9
|
|
|
4.8
|
|
(1) |
Inventory impairment – current period is the inventory valuation adjustments recorded during the period presented associated with homes that remain in inventory at period end.
|
(2) |
Inventory impairment – prior period is the inventory valuation adjustments recorded in prior periods associated with homes that sold in the period presented.
|
(3) |
Interest expense capitalized represents all interest related costs, including senior and mezzanine secured credit facilities, incurred on homes sold in the period presented that were capitalized and expensed in cost of sales at the time of sale.
|
(4) |
Direct selling costs represents selling costs incurred related to homes sold in the period presented. This primarily includes broker commissions and title and escrow closing fees.
|
(5) |
Holding costs primarily include property taxes, insurance, utilities, homeowners association dues, cleaning and maintenance costs.
|
(6) |
Represents holding costs incurred on homes sold in the period presented and expensed to Sales, marketing, and operating on the Consolidated Statements of Operations.
|
(7) |
Represents holding costs incurred in prior periods on homes sold in the period presented and expensed to Sales, marketing, and operating on the Consolidated Statements of Operations.
|
(8) |
Other income in 2020 primarily consists of net income to Offerpad from our historical investment in Offerpad Home Loans. In 2021, other income was earned from the sale of certain fixed assets.
|
(9) |
Represents both senior and mezzanine interest expense incurred on homes sold in the period presented and expensed to interest expense on the Consolidated Statements of Operations.
|
(10) |
Represents both senior and mezzanine secured credit facilities interest expense incurred in prior periods on homes sold in the period presented and expensed to Interest expense on the Consolidated Statements of Operations.
|
Three Months Ended
June 30, |
Six Months Ended
June 30, |
Year Ended December 31,
|
||||||||||||||||||||||||||
(in thousands, except
percentages, unaudited)
|
2021
|
2020
|
2021
|
2020
|
2020
|
2019
|
2018
|
|||||||||||||||||||||
Net income (loss) (GAAP)
|
$ | 9,190 | $ | (7,390 | ) | $ | 8,957 | $ | (18,855 | ) | $ | (23,118 | ) | $ | (51,952 | ) | $ | (32,937 | ) | |||||||||
Interest expense
|
2,257 | 2,418 | 4,175 | 7,092 | 10,031 | 18,298 | 18,329 | |||||||||||||||||||||
Amortization of capitalized
interest (1) |
767 | 920 | 1,373 | 2,140 | 2,962 | 6,769 | 6,194 | |||||||||||||||||||||
Income tax expense
|
89 | — | 89 | — | 163 | 254 | 506 | |||||||||||||||||||||
Depreciation and amortization
|
146 | 102 | 277 | 204 | 434 | 377 | 192 | |||||||||||||||||||||
Amortization of share based compensation
|
649 | 288 | 1,263 | 538 | 1,363 | 1,268 | 893 | |||||||||||||||||||||
Adjusted EBITDA
|
|
13,098
|
|
|
(3,662
|
)
|
|
16,134
|
|
|
(8,881
|
)
|
|
(8,165
|
)
|
|
(24,986
|
)
|
|
(6,823
|
)
|
|||||||
Adjusted EBITDA margin
|
|
3.5
|
%
|
|
(1.3
|
%)
|
|
2.4
|
%
|
|
(1.4
|
%)
|
|
(0.8
|
%)
|
|
(2.3
|
%)
|
|
(0.8
|
%)
|
(1) |
Amortization of capitalized interest represents all interest related costs, including senior and mezzanine interest related costs, incurred on homes sold in the period presented that were capitalized and expensed in cost of sales at the time of sale.
|
Three Months Ended June 31,
|
Six Months Ended June 31,
|
|||||||||||||||||||||||||||||||
2021
|
2020
|
$ Change
|
%
Change |
2021
|
2020
|
$ Change
|
%
Change |
|||||||||||||||||||||||||
(in thousands, except percentages)
|
(in thousands, except percentages)
|
|||||||||||||||||||||||||||||||
Revenue
|
$ | 378,647 | $ | 287,007 | $ | 91,640 | 31.9 | % | $ | 662,619 | $ | 654,662 | $ | 7,957 | 1.2 | % | ||||||||||||||||
Cost of revenue
|
327,783 | 269,146 | 58,637 | 21.8 | % | 578,218 | 611,903 | (33,685 | ) | -5.5 | % | |||||||||||||||||||||
Gross profit
|
50,864 | 17,861 | 33,003 | * | 84,401 | 42,759 | 41,642 | 97.4 | % | |||||||||||||||||||||||
Operating expenses:
|
||||||||||||||||||||||||||||||||
Sales, marketing and operating
|
31,595 | 17,547 | 14,048 | 80.1 | % | 56,671 | 42,976 | 13,695 | 31.9 | % | ||||||||||||||||||||||
General and administrative
|
5,137 | 3,862 | 1,275 | 33.0 | % | 9,871 | 8,223 | 1,648 | 20.0 | % | ||||||||||||||||||||||
Technology and development
|
2,603 | 1,692 | 911 | 53.8 | % | 4,886 | 3,821 | 1,065 | 27.9 | % | ||||||||||||||||||||||
Total operating expenses
|
39,335 | 23,101 | 16,234 | 70.3 | % | 71,428 | 55,020 | 16,408 | 29.8 | % | ||||||||||||||||||||||
Income (loss) from operations
|
11,529 | (5,240 | ) | 16,769 | * | 12,973 | (12,261 | ) | 25,234 | * | ||||||||||||||||||||||
Interest expense
|
(2,257 | ) | (2,418 | ) | (161 | ) | -6.7 | % | (4,175 | ) | (7,092 | ) | (2,917 | ) | -41.1 | % | ||||||||||||||||
Other income, net
|
7 | 268 | (261 | ) | -97.4 | % | 248 | 498 | (250 | ) | -50.2 | % | ||||||||||||||||||||
Income (loss) before income taxes
|
9,279 | (7,390 | ) | 16,669 | * | 9,046 | (18,855 | ) | 27,901 | * | ||||||||||||||||||||||
Income tax expense
|
(89 | ) | — | (89 | ) | * | (89 | ) | — | (89 | ) | * | ||||||||||||||||||||
Net Income (loss)
|
$ | 9,190 | $ | (7,390 | ) | $ | 16,580 | * | $ | 8,957 | $ | (18,855 | ) | $ | 27,812 | * |
* |
Not meaningful
|
Year Ended December 31,
|
||||||||||||||||
2020
|
2019
|
$ Change
|
%
Change |
|||||||||||||
(in thousands, except percentages)
|
||||||||||||||||
Revenue
|
$ | 1,064,257 | $ | 1,075,882 | $ | (11,625 | ) | -1.1 | % | |||||||
Cost of revenue
|
976,478 | 1,001,495 | (25,017 | ) | -2.5 | % | ||||||||||
Gross profit
|
87,779 | 74,387 | 13,392 | 18.0 | % | |||||||||||
Operating expenses:
|
||||||||||||||||
Sales, marketing and operating
|
76,786 | 85,226 | (8,440 | ) | -9.9 | % | ||||||||||
General and administrative
|
17,481 | 15,111 | 2,370 | 15.7 | % | |||||||||||
Technology and development
|
7,270 | 7,450 | (180 | ) | -2.4 | % | ||||||||||
Total operating expenses
|
101,537 | 107,787 | (6,250 | ) | -5.8 | % | ||||||||||
Loss from operations
|
(13,758 | ) | (33,400 | ) | 19,642 | -58.8 | % | |||||||||
Interest expense
|
(10,031 | ) | (18,298 | ) | 8,267 | -45.2 | % | |||||||||
Other income, net
|
834 | — | 834 | 100.0 | % | |||||||||||
Loss before income taxes
|
(22,955 | ) | (51,698 | ) | 28,743 | -55.6 | % | |||||||||
Income tax expense
|
(163 | ) | (254 | ) | 91 | -35.8 | % | |||||||||
Net loss
|
$ | (23,118 | ) | $ | (51,952 | ) | $ | 28,834 | -55.5 | % |
Year Ended December 31,
|
||||||||||||||||
2019
|
2018
|
$ Change
|
%
Change |
|||||||||||||
(in thousands, except percentages)
|
||||||||||||||||
Revenue
|
$ | 1,075,882 | $ | 855,961 | $ | 219,921 | 25.7 | % | ||||||||
Cost of revenue
|
1,001,495 | 790,100 | 211,395 | 26.8 | % | |||||||||||
Gross profit
|
74,387 | 65,861 | 8,526 | 12.9 | % | |||||||||||
Operating expenses:
|
||||||||||||||||
Sales, marketing and operating
|
85,226 | 64,695 | 20,531 | 31.7 | % | |||||||||||
General and administrative
|
15,111 | 11,550 | 3,561 | 30.8 | % | |||||||||||
Technology and development
|
7,450 | 3,718 | 3,732 | 100.4 | % | |||||||||||
Total operating expenses
|
107,787 | 79,963 | 27,824 | 34.8 | % | |||||||||||
Loss from operations
|
(33,400 | ) | (14,102 | ) | (19,298 | ) | 136.8 | % | ||||||||
Interest expense
|
(18,298 | ) | (18,329 | ) | 31 | -0.2 | % | |||||||||
Loss before income taxes
|
(51,698 | ) | (32,431 | ) | (19,267 | ) | 59.4 | % | ||||||||
Income tax expense
|
(254 | ) | (506 | ) | 252 | -49.8 | % | |||||||||
Net loss
|
(51,952 | ) | (32,937 | ) | (19,015 | ) | 57.7 | % |
As of June 30, 2021
|
Borrowing
Capacity |
Outstanding
Amount |
Weighted-
Average Interest Rate |
Maturity Date
|
||||||||||||
Senior secured credit facility with a financial institution
|
$ | 250,000 | $ | 229,390 | 2.60 | % | August 2022 | |||||||||
Senior secured credit facility with a related party
|
225,000 | 159,810 | 4.12 | % | December 2022 | |||||||||||
$ | 475,000 | $ | 389,200 |
As of June 30, 2021
|
Borrowing
Capacity |
Outstanding
Amount |
Weighted-
Average Interest Rate |
Maturity Date
|
||||||||||||
Mezzanine credit facility with a related party
|
$ | 31,250 | $ | 28,674 | 13.00 | % | February 2023 | |||||||||
Mezzanine credit facility with a related party
|
43,450 | 34,621 | 13.00 | % | December 2022 | |||||||||||
$ | 74,700 | $ | 63,295 |
Six Months Ended
June 30, |
Year Ended December 31,
|
|||||||||||||||||||
2021
|
2020
|
2020
|
2019
|
2018
|
||||||||||||||||
(in thousands)
|
(in thousands)
|
|||||||||||||||||||
Net cash (used in) provided by operating activities
|
$ | (297,530 | ) | $ | 202,960 | $ | 154,864 | $ | (108,974 | ) | $ | (78,687 | ) | |||||||
Net cash used in investing activities
|
(3,910 | ) | (11 | ) | (2,858 | ) | (979 | ) | (2,027 | ) | ||||||||||
Net cash provided by (used in) financing activities
|
308,599 | (183,859 | ) | (131,147 | ) | 122,503 | 88,764 | |||||||||||||
Net change in cash, cash equivalents and restricted cash
|
$ | 7,159 | $ | 19,090 | $ | 20,859 | $ | 12,550 | $ | 8,050 |
Payments Due by Year
|
||||||||||||||||
Total
|
Less than
1 year |
1-3
years |
3-5
years |
|||||||||||||
(in thousands)
|
(in thousands)
|
|||||||||||||||
Senior Secured Credit Facilities (1)
|
$ | 156,472 | $ | 155,819 | $ | 653 | $ | — | ||||||||
Mezzanine Secured Credit Facilities (1)
|
19,912 | 19,912 | — | — | ||||||||||||
Other Notes Payable (2)
|
8,619 | 4,485 | 4,134 | — | ||||||||||||
Homes Purchase Commitments (3)
|
228,989 | 228,989 | — | — | ||||||||||||
Operating Leases (4)
|
5,212 | 1,354 | 3,355 | 503 | ||||||||||||
Other Contract Commitments (5)
|
4,567 | 3,896 | 667 | 4 | ||||||||||||
Total
|
$ | 423,771 | $ | 414,455 | $ | 8,809 | $ | 507 |
(1) |
Represents the principal amounts outstanding as of December 31, 2020. Includes estimated interest payments, calculated using the variable rate in existence at period end over an assumed holding period of 95 days. Borrowings under the senior and mezzanine secured credit facilities are payable as the related inventory is sold. The payments are generally expected to be within one year of December 31, 2020.
|
(2) |
Represents the principal amounts outstanding as of December 31, 2020 and estimated interest payments, calculated using the fixed rates in existence at period end through maturity.
|
(3) |
As of December 31, 2020, we were under contract to purchase 936 homes with a purchase price of $229.0 million.
|
(4) |
Represents future payments for long-term operating leases that have commenced as of December 31, 2020.
|
(5) |
Represents other financial obligations that have commenced as of December 31, 2020.
|
• |
our historical financial performance and capital structure;
|
• |
external market conditions that affect the industry in which we operate;
|
• |
our current financial position and forecasted operating results;
|
• |
the lack of marketability for our common stock; and
|
• |
market analysis of similar companies’ stock price valuation.
|
• |
Homes not houses.
|
• |
Freedom first.
|
• |
Every day matters.
|
• |
Results rule.
|
• |
Embrace our roots.
|
Name
|
Age
|
Position
|
||||
Brian Bair
|
45 | Chief Executive Officer and Chairman of the Board | ||||
Stephen Johnson
|
51 | Chief Operating Officer | ||||
Michael Burnett
|
53 | Chief Financial Officer | ||||
Benjamin Aronovitch
|
43 | Chief Legal Officer | ||||
Katie Curnutte
|
41 | Director | ||||
Kenneth DeGiorgio
|
50 | Director | ||||
Alexander Klabin
|
45 | Director | ||||
Ryan O’Hara
|
52 | Director | ||||
Sheryl Palmer
|
59 | Director | ||||
Roberto Sella
|
56 | Director |
• |
the Class I directors are Brian Bair, Roberto Sella and Kenneth DeGiorgio, and their terms will expire at the annual meeting of stockholders to be held in 2022;
|
• |
the Class II directors are Alexander Klabin and Katie Curnutte, and their terms will expire at the annual meeting of stockholders to be held in 2023; and
|
• |
the Class III directors are Sheryl Palmer and Ryan O’Hara, and their terms will expire at the annual meeting of stockholders to be held in 2024.
|
• |
appointing, compensating, retaining, evaluating, terminating and overseeing our independent registered public accounting firm;
|
• |
discussing with our independent registered public accounting firm their independence from management;
|
• |
reviewing with our independent registered public accounting firm the scope and results of their audit;
|
• |
pre-approving
all audit and permissible
non-audit
services to be performed by our independent registered public accounting firm;
|
• |
overseeing the financial reporting process and discussing with management and our independent registered public accounting firm the interim and annual financial statements that we file with the SEC;
|
• |
reviewing and monitoring our accounting principles, accounting policies, financial and accounting controls and compliance with legal and regulatory requirements; and
|
• |
establishing procedures for the confidential anonymous submission of concerns regarding questionable accounting, internal controls or auditing matters.
|
• |
reviewing and approving corporate goals and objectives relevant to the compensation of our Chief Executive Officer, evaluating the performance of our Chief Executive Officer in light of these goals and objectives and setting or making recommendations to the Board regarding the compensation of our Chief Executive Officer;
|
• |
reviewing and setting or making recommendations to our board of directors regarding the compensation of our other executive officers;
|
• |
making recommendations to our board of directors regarding the compensation of our directors;
|
• |
reviewing and approving or making recommendations to our board of directors regarding our incentive compensation and equity-based plans and arrangements; and
|
• |
appointing and overseeing any compensation consultants.
|
• |
identifying individuals qualified to become members of our board of directors, consistent with criteria approved by our board of directors;
|
• |
recommending to our board of directors the nominees for election to our board of directors at annual meetings of our stockholders;
|
• |
overseeing an evaluation of our board of directors and its committees; and
|
• |
developing and recommending to our board of directors a set of corporate governance guidelines.
|
• |
Brian Bair,
Chief Executive Officer
|
• |
Benjamin Aronovitch,
Chief Legal Officer
|
• |
Stephen Johnson,
Chief Operating Officer
|
Name and Principal Position
|
Salary
($) |
Bonus
($)(1) |
Option
Awards ($)(2) |
Non-Equity
Incentive Plan Compensation ($)(3) |
Total
($) |
|||||||||||||||
Brian Bair
Chief Executive Officer
|
269,330 | — | — | 190,328 | 459,658 | |||||||||||||||
Benjamin Aronovitch
Chief Legal Officer
|
62,500 | 200,000 | 649,499 | — | 911,999 | |||||||||||||||
Stephen Johnson
Chief Operating Officer
|
118,750 | — | 668,430 | 63,934 | 851,114 |
(1) |
Amounts reflect (i) payment of a guaranteed annual cash bonus paid to Mr. Aronovitch in 2020 ($100,000) and (ii) payment of a
one-time
sign-on
bonus ($100,000) to Mr. Aronovitch in connection with the commencement of his employment in 2020, each as further described below in “
—2020 Bonuses
|
(2) |
Amount reflects the aggregate grant date fair market value of Offerpad Options granted under the 2016 Plan (each as defined herein) to the named executive officer during the year ended December 31, 2020, computed in accordance with FASB ASC Topic 718,
Compensation—Stock Compensation
|
(3) |
Amounts reflect annual bonuses earned by the named executive officers in 2020, based on the achievement of
pre-established
performance goals, and which were paid in cash in 2021 as further described below in “
—2020 Bonuses
|
(4) |
Mr. Aronovitch commenced employment with Offerpad on October 12, 2020. Mr. Aronovitch’s salary was prorated for the portion of the fiscal year during which he was employed.
|
(5) |
Mr. Johnson commenced employment with Offerpad on August 10, 2020. Mr. Johnson’s salary was prorated for the portion of the fiscal year during which he was employed.
|
Named Executive Officer
|
2020
Options Granted |
|||
Benjamin Aronovitch
|
145,000 | |||
Stephen Johnson
|
150,000 |
• |
medical, dental and vision benefits;
|
• |
medical and dependent care flexible spending accounts;
|
• |
short-term and long-term disability insurance;
|
• |
basic life and accidental death and dismemberment insurance;
|
• |
supplemental life insurance; and
|
• |
vacation and paid holidays.
|
Option Awards
|
||||||||||||||||||||||||||||
Name
|
Grant Date
|
Vesting
Commencement Date |
Number of
Securities Underlying Unexercised Options (#) Exercisable |
Number of
Securities Underlying Unexercised Options (#) Unexercisable |
Equity
Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options |
Option
Exercise Price ($) |
Option
Expiration Date |
|||||||||||||||||||||
Brian Bair
|
2/10/2017 | (1) | 79,335 | — | 158,667 | 5.18 | 2/9/2027 | |||||||||||||||||||||
2/10/2017 | (1) | 42,854 | — | 85,707 | 5.44 | 2/9/2027 | ||||||||||||||||||||||
7/11/2017 | (1) | 4,212 | — | 8,425 | 5.44 | 7/10/2027 | ||||||||||||||||||||||
7/11/2017 | (1) | 1,295 | — | 2,591 | 5.18 | 7/10/2027 | ||||||||||||||||||||||
Benjamin Aronovitch
|
10/27/2020 | 10/12/2020 | (2) | — | 145,000 | 9.19 | 10/26/2030 | |||||||||||||||||||||
Stephen Johnson
|
10/27/2020 | 8/10/2020 | (2) | — | 150,000 | 9.19 | 10/26/2030 |
(1) |
Each of these Offerpad Options vests and becomes exercisable with respect to
one-third
of the shares underlying the Offerpad Option upon our board’s good faith determination that the per share value of Offerpad’s common stock (on a fully-diluted basis) equals or exceeds three times (3x), four times (4x) and/or five times (5x), in each case, of the exercise price applicable to the Offerpad Option. On February 5, 2019,
one-third
(1/3) of the shares subject to these Offerpad Options vested in connection with Offerpad’s attainment of a per share value of $19.92, as determined by our board of directors. In addition, upon the closing of the Business Combination, these Offerpad Options accelerated and became fully vested and exercisable.
|
(2) |
Each of these Offerpad Options vests and becomes exercisable over a four-year period, subject to the officer’s continued employment with Offerpad or its affiliates through the applicable vesting date, as follows: (i) 25% of the shares underlying the Offerpad Option on the first annual anniversary of the vesting commencement date and (ii) 75% of the shares underlying the Offerpad Option in 12 substantially equal installments on each quarterly anniversary of the vesting commencement date thereafter. In addition, upon the occurrence of a “sale event” (as defined in the 2016 Plan), the Offerpad Option will accelerate and become fully vested and exercisable.
|
(i) |
in the case of Mr. Aronovitch, (A) if such termination occurs during the officer’s first year of employment with the Company, an amount equal to 12 months of his then-current base salary, payable in equal installments in accordance with the Company’s normal payroll policies, or (B) if such termination occurs after the officer’s first year of employment with the Company, an amount equal to six months of his then-current base salary, payable in equal installments in accordance with the Company’s normal payroll policies;
provided that
|
(ii) |
in the case of Mr. Johnson, an amount equal to six months of his then-current base salary, payable in equal installments in accordance with the Company’s normal payroll policies, provided that if such
|
termination occurs in contemplation of or within 12 months following a sale event, such severance amount will be paid in a single lump sum; and |
(iii) |
each of Messrs. Aronovitch and Johnson is also eligible to receive (A) payment of any annual bonus that the officer has earned in respect of the calendar year ending on or prior to the applicable date of termination, and (B) Company-subsidized healthcare coverage at the same levels as in effect on the date of termination for up to six months following the applicable date of termination.
|
Name
|
Fees
Earned or Paid in Cash ($) |
Total ($)
|
||||||
James Satloff
|
60,000 | 60,000 | ||||||
Kenneth DeGiorgio
|
— | — | ||||||
James Morrissey
|
— | — | ||||||
Shivraj Mundy
|
— | — | ||||||
Roberto Sella
|
— | — | ||||||
Vaughn Bair(1)
|
$ | 249,914 | $ | 249,914 |
(1) |
In addition to serving on our board of directors during 2020 and until the close of the Business Combination, Mr. Bair was employed as a
non-executive
employee of Offerpad pursuant to an offer letter by and between Offerpad and Mr. Bair, dated as of August 5, 2016. This offer letter generally provides for
at-will
employment, an annual base salary of $150,000, a 60% target bonus opportunity under our annual bonus program, participation in Offerpad health and welfare plans and customary restrictive covenants. In 2020 Mr. Bair received an annual base salary of $313,000; Mr. Bair did not receive additional compensation for his services on our board of directors during 2020.
|
• |
Annual Retainer: $50,000
|
• |
Annual Committee Chair Retainer:
|
• |
Audit: $20,000
|
• |
Compensation: $20,000
|
• |
Nominating and Governance: $10,000
|
• |
Annual Committee Member
(Non-Chair)
Retainer:
|
• |
Audit: $10,000
|
• |
Compensation: $10,000
|
• |
Nominating and Corporate Governance: $5,000
|
• |
Lead Independent Director: $25,000
|
• |
Initial Grant
|
• |
Annual Grant:
|
Amounts
outstanding as of June 30, 2021 |
||||
Ashlee Anderson
|
$ | 300,000 | ||
Bonnie Simonton
|
200,000 | |||
Scott Simonton
|
592,328 | |||
|
|
|||
Total
|
$ | 1,092,328 | ||
|
|
• |
any person who is, or at any time during the applicable period was, one of our executive officers or directors;
|
• |
any person who is known by us to be the beneficial owner of more than 5% of our voting stock;
|
• |
any immediate family member of any of the foregoing persons, which means any child, stepchild, parent, stepparent, spouse, sibling,
mother-in-law,
father-in-law,
son-in-law,
daughter-in-law,
brother-in-law
sister-in-law
|
• |
any firm, corporation or other entity in which any of the foregoing persons is a partner or principal, or in a similar position, or in which such person has a 10% or greater beneficial ownership interest.
|
• |
each person who is known to be the beneficial owner of more than 5% of shares of Class A Common Stock or Class B Common Stock;
|
• |
each of Offerpad’s current named executive officers and directors; and
|
• |
all current executive officers and directors of Offerpad as a group.
|
Name and Address of Beneficial Owner(1)
|
Class A Common Stock
|
Class B Common Stock
|
Percentage of
Total Voting Power |
|||||||||||||||||
Shares
|
%
|
Shares
|
%
|
|||||||||||||||||
5% Holders
|
||||||||||||||||||||
Supernova Partners LLC(2)
|
16,561,250 | 7.2 | % | — | — | 4.4 | % | |||||||||||||
Entities affiliated with LL Capital Partners I, L.P.(3)
|
100,249,983 | 44.8 | % | — | — | 27.0 | % | |||||||||||||
First American Financial Corporation(4)
|
32,138,883 | 14.4 | % | — | — | 8.6 | % | |||||||||||||
Jerry Coleman(5)
|
18,714,704 | 8.3 | % | — | — | 5.0 | % | |||||||||||||
Directors and Executive Officers
|
||||||||||||||||||||
Brian Bair(6)
|
17,701,926 | 7.3 | % | 14,816,236 | 100.0 | % | 40.3 | % | ||||||||||||
Stephen Johnson(7)
|
282,478 | * | — | — | * | |||||||||||||||
Mike Burnett(8)
|
564,956 | * | — | — | * | |||||||||||||||
Benjamin Aronovitch(9)
|
273,062 | * | — | — | * | |||||||||||||||
Katie Curnutte
|
— | — | — | — | — | |||||||||||||||
Kenneth DeGiorgio
|
— | — | — | — | — | |||||||||||||||
Alexander M. Klabin(10)
|
6,000,000 | 2.7 | % | — | — | 1.6 | % | |||||||||||||
Ryan O’Hara
|
— | — | — | — | — | |||||||||||||||
Sheryl Palmer
|
35,000 | * | — | — | * | |||||||||||||||
Roberto Sella(3)
|
100,628,089 | 45.0 | % | — | — | 27.1 | % | |||||||||||||
All directors and executive officers as a group (10 individuals)
|
125,485,511 | 51.5 | % | 14,816,236 | 100.0 | % | 68.6 | % |
* |
Less than one percent
|
(1) |
Unless otherwise noted, the business address of each of those listed in the table above is 2150 E Germann Rd., Suite 1, Chandler, AZ 85286.
|
(2) |
Includes 9,861,250 shares of Class A Common Stock and 6,700,000 warrants to purchase Class A Common Stock that will be exercisable within 60 days of September 1, 2021. Supernova Partners LLC is governed by a board of managers consisting of four managers: Spencer M. Rascoff, Alexander M. Klabin, Robert D. Reid and Michael S. Clifton. As a result, each of Messrs. Rascoff, Klabin, Reid, and Clifton may be deemed to share beneficial ownership of the securities owned by Supernova Partners LLC. However, each manager of Supernova Partners LLC has one vote, and the approval of a majority of the manager is required to approve any action of Supernova Partners LLC. Under the
so-called
“rule of three,” if voting and dispositive decisions regarding an entity’s securities are made by three or more individuals, and a voting or dispositive decision requires the approval of at least a majority of those individuals, then none of the individuals is
|
deemed a beneficial owner of the entity’s securities. The address of Supernova Partners LLC is 4301 50th Street NW, Suite 300 PMB 1044, Washington, D.C. 20016 and post-business combination. |
(3) |
Consists of shares of Class A Common Stock held by LL Capital Partners I, L.P. and by SIF V, LLC. LLCP I GP, LLC is the general partner of LL Capital Partners I, L.P. and exercises voting and dispositive power over the shares noted herein held by LL Capital Partners I, L.P. LLCP II GP, LLC is the general partner of SIF V, LLC and exercises voting and dispositive power over the shares noted herein held by SIF V, LLC. Roberto Sella is the sole manager of SIF V, LLC and LLCP II GP, LLC. As the sole manager of SIF V, LLC and LLCP II GP, LLC, Roberto Sella may be deemed to have voting and dispositive power for the shares noted herein held by LL Capital Partners I, L.P. and SIF V, LLC. Each of LL Capital Partners I, L.P., SIF V, LLC and Roberto Sella separately disclaim beneficial ownership over the shares noted herein except to the extent of their pecuniary interest therein. The address for these entities and individuals is c/o LL Funds, LLC, 2400 Market Street Philadelphia, PA 19103.
|
(4) |
Consists of shares of Class A Common Stock held of record by First American Financial Corporation (“First American”). The management of First American exercises voting and dispositive power with respect to these securities. The board of directors of First American is responsible for appointing all of the members of management, and no member of the board of directors of First American is deemed to beneficially own the shares of common stock held by First American. The address for First American Financial Corporation is 1 First American Way, Santa Ana, CA 97207.
|
(5) |
Includes 2,885,690 shares of Class A Common Stock that would be issuable upon exercise of options exercisable as of or within 60 days of September 1, 2021.
|
(6) |
Consists of (i) 2,648,229 shares of our Class B Common Stock held by the BAB 2021 Irrevocable Trust, (ii) 12,168,007 shares of Class B Common Stock and (iii) 2,534,128 shares of Class A Common Stock that would be issuable upon exercise of options exercisable as of or within 60 days of September 1, 2021.
|
(7) |
Consists of 282,478 shares of Class A Common Stock that would be issuable upon exercise of options exercisable as of or within 60 days of September 1, 2021.
|
(8) |
Consists of 564,956 shares of Class A Common Stock that would be issuable upon exercise of options exercisable as of or within 60 days of September 1, 2021.
|
(9) |
Consists of 273,062 shares of Class A Common Stock that would be issuable upon exercise of options exercisable as of or within 60 days of September 1, 2021.
|
(10) |
Consists of (i) 4,500,000 shares of Class A Common Stock and (ii) 1,500,000 warrants to purchase shares of Class A common stock that will be exercisable within 60 days of September 1, 2021 held by an entity controlled by Mr. Klabin.
|
Names and Addresses
|
Securities
Beneficially Owned prior to this Offering |
Securities
to be Sold in this Offering |
Securities Beneficially Owned after this
Offering |
|||||||||||||||||||||||||||||
Shares of
Class A Common Stock |
Warrants
|
Shares of
Class A Common Stock |
Warrants
|
Shares of
Class A Common Stock |
Percentage
|
Warrants
|
Percentage
|
|||||||||||||||||||||||||
Alyeska Master Fund, L.P.
|
400,000 | — | 400,000 | — | — | — | — | — | ||||||||||||||||||||||||
BlackRock, Inc.(1)
|
4,000,000 | — | 4,000,000 | — | — | — | — | — | ||||||||||||||||||||||||
Cypress Forest Investments LLC
|
750,000 | — | 750,000 | — | — | — | — | — | ||||||||||||||||||||||||
Darrell Sherman
|
30,000 | — | 30,000 | — | — | — | — | — | ||||||||||||||||||||||||
Carl David Cone
|
30,000 | — | 30,000 | — | — | — | — | — | ||||||||||||||||||||||||
David S. Connelly
|
50,000 | — | 50,000 | — | — | — | — | — | ||||||||||||||||||||||||
CVI Investments, Inc.
|
400,000 | — | 400,000 | — | — | — | — | — | ||||||||||||||||||||||||
Indaba Capital Fund, L.P.(2)
|
800,000 | — | 800,000 | — | — | — | — | — | ||||||||||||||||||||||||
Highmark Long/Short Equity 4 Ltd.
|
343,496 | — | 343,496 | — | — | — | — | — | ||||||||||||||||||||||||
Islet Master Fund LP
|
456,504 | — | 456,504 | — | — | — | — | — | ||||||||||||||||||||||||
Ghisallo Master Fund LP
|
355,000 | — | 355,000 | — | — | — | — | — | ||||||||||||||||||||||||
LH Capital Markets, LLC
|
500,000 | — | 500,000 | — | — | — | — | — | ||||||||||||||||||||||||
Luxor Wavefront, LP
|
411,351 | — | 411,351 | — | — | — | — | — | ||||||||||||||||||||||||
Thebes Offshore Master Fund, LP
|
257,143 | — | 257,143 | — | — | — | — | — | ||||||||||||||||||||||||
Lugard Road Capital Master Fund, LP
|
675,316 | — | 675,316 | — | — | — | — | — | ||||||||||||||||||||||||
Luxor Capital Partners Long Offshore
|
10,889 | — | 10,889 | — | — | — | — | — |
Names and Addresses
|
Securities
Beneficially Owned prior to this Offering |
Securities
to be Sold in this Offering |
Securities Beneficially Owned after this
Offering |
|||||||||||||||||||||||||||||
Shares of
Class A Common Stock |
Warrants
|
Shares of
Class A Common Stock |
Warrants
|
Shares of
Class A Common Stock |
Percentage
|
Warrants
|
Percentage
|
|||||||||||||||||||||||||
Entities affiliated with LL Capital Partners I, L.P.(6)
|
100,249,983 | — | 100,249,983 | — | — | — | — | — | ||||||||||||||||||||||||
First American Financial Corporation(7)
|
32,138,883 | — | 32,138,883 | — | — | — | — | — | ||||||||||||||||||||||||
Jerry Coleman(8)
|
18,714,704 | — | 18,714,704 | — | — | — | — | — | ||||||||||||||||||||||||
Brian Bair(9)
|
17,701,926 | — | 17,701,926 | — | — | — | — | — | ||||||||||||||||||||||||
Stephen Johnson(10)
|
1,129,912 | — | 1,129,912 | — | — | — | — | — | ||||||||||||||||||||||||
Mike Burnett(11)
|
1,129,912 | — | 1,129,912 | — | — | — | — | — | ||||||||||||||||||||||||
Benjamin Aronovitch(12)
|
1,092,248 | — | 1,092,248 | — | — | — | — | — | ||||||||||||||||||||||||
Ancient 1604 LLC(13)
|
6,000,000 | 1,500,000 | 6,000,000 | 1,500,000 | — | — | — | — | ||||||||||||||||||||||||
Roberto Sella(14)
|
378,106 | — | 378,106 | — | — | — | — | — | ||||||||||||||||||||||||
75 & Sunny LP(15)
|
666,667 | 166,667 | 666,667 | 166,667 | — | — | — | — | ||||||||||||||||||||||||
Vaughn Bair(16)
|
9,848,875 | — | 9,848,875 | — | — | — | — | — | ||||||||||||||||||||||||
Casey Bair(17)
|
6,778,397 | — | 6,778,397 | — | — | — | — | — | ||||||||||||||||||||||||
Darrin Shamo(18)
|
1,401,278 | — | 1,401,278 | — | — | — | — | — | ||||||||||||||||||||||||
Ken Fox(19)
|
40,250 | — | 40,250 | — | — | — | — | — | ||||||||||||||||||||||||
Jim Lanzone(19)
|
40,250 | — | 40,250 | — | — | — | — | — | ||||||||||||||||||||||||
Gregg Renfrew(19)
|
40,250 | — | 40,250 | — | — | — | — | — | ||||||||||||||||||||||||
Rajeev Singh(19)
|
40,250 | — | 40,250 | — | — | — | — | — | ||||||||||||||||||||||||
Damien Hooper-Campbell(19)
|
40,250 | — | 40,250 | — | — | — | — | — |
(1) |
The registered holders of the referenced shares to be registered are the following funds and accounts under management by subsidiaries of BlackRock, Inc.: BlackRock Global Allocation Fund, Inc.; BlackRock Global Funds - Global Allocation Fund; BlackRock Global Allocation V.I. Fund of BlackRock Variable Series Funds, Inc.; BlackRock Global Allocation Portfolio of BlackRock Series Fund, Inc.; BlackRock Global Allocation Collective Fund; BlackRock Global Funds - Global Dynamic Equity Fund; BlackRock Capital Allocation Trust; BlackRock Strategic Income Opportunities Portfolio of BlackRock Funds V; Strategic Income Opportunities Bond Fund; BGF ESG Fixed Income Global Opportunities Fund; BGF Fixed Income Global Opportunities Fund; Master Total Return Portfolio of Master Bond LLC; BlackRock Total Return Bond Fund; and BlackRock Global Long/Short Credit Fund of BlackRock Funds IV. BlackRock, Inc. is the ultimate parent holding company of such subsidiaries. On behalf of such subsidiaries, the applicable portfolio managers, as managing directors (or in other capacities) of such entities, and/or the applicable investment committee members of such funds and accounts, have voting and investment power over the shares held by the funds and accounts which are the registered holders of the referenced shares. Such portfolio managers and/or investment committee members expressly disclaim beneficial ownership of all shares held by such funds and accounts. The address of such funds and accounts, such subsidiaries and such portfolio managers and/or investment committee members is 55 East 52nd Street, New York, New York 10055. Shares shown include only the securities being registered for resale and may not incorporate all shares deemed to be beneficially held by the registered holders or BlackRock, Inc.
|
(2) |
The securities in the table above are held directly by Indaba Capital Fund, L.P. (“Indaba Fund”). Indaba Capital Management, L.P. (“Indaba Management”) is Indaba Fund’s investment manager. Pursuant to an Investment Management Agreement, Indaba Fund and its general partner have delegated all voting and investment power over securities held by Indaba Fund to Indaba Management and, accordingly, Indaba Management may be deemed to have beneficial ownership of such securities. IC GP, LLC, as the general partner of Indaba Management, and Derek Schrier, as Managing Member of IC GP, LLC, may be deemed to exercise voting and investment power over and have beneficial ownership of the securities held by Indaba Fund. Indaba Fund specifically disclaims beneficial ownership of the securities in the table above that are directly held by it by virtue of its inability to vote or dispose of such securities as a result of the delegation of voting and investment power to Indaba Management. The business address of Indaba Fund, Indaba Management, IC GP, LLC, and Mr. Schrier is c/o Indaba Capital Management, L.P., 1 Letterman Drive, Building D, Suite DM700, San Francisco, CA 94129.
|
(3) |
Sheryl Palmer is a member of the board of directors of the Company.
|
(4) |
ZP Master Utility Fund, Ltd. (the “ZP Fund”) has delegated to Zimmer Partners, LP, as investment manager (the “ZP Investment Manager”), sole voting and investment power over the Class A Common Stock held by the ZP Fund pursuant to its investment management agreement with Zimmer Partners, LP. As a result, each of the ZP Investment Manager, Zimmer Partners GP, LLC, as the general partner of the Investment Manager, Sequentis Financial LLC, as the sole member of Zimmer Partners GP, LLC, and Stuart J. Zimmer, as the managing member of Sequentis Financial LLC, may be deemed to exercise voting and investment power over the Class A Common Stock held by the ZP Fund and thus may be deemed to beneficially own such Class A Common Stock.
|
(5) |
Consists of (i) 9,861,250 shares of Class A Common Stock and (ii) 6,700,000 warrants to purchase shares of Class A Common Stock. Supernova Partners LLC is governed by a board of managers consisting of four managers: Spencer M. Rascoff, Alexander M. Klabin, Robert D. Reid and Michael S. Clifton. As a result, each of Messrs. Rascoff, Klabin, Reid, and Clifton may be deemed to share beneficial ownership of the securities owned by Supernova Partners LLC. However, each manager of Supernova Partners LLC has one vote, and the approval of a majority of the manager is required to approve any action of Supernova Partners LLC. Alexander Klabin is a member of the board of directors at the Company. These securities are being registered for resale in accordance with the terms of the Registration Rights Agreement, as described under “
Certain Relationships and Related Party Transactions—Registration Rights Agreement
|
(6) |
Consists of (i) 92,685,278 shares of Class A Common Stock held by LL Capital Partners I, L.P. and (ii) 7,564,705 shares of Class A Common Stock held by SIF V, LLC. LLCP I GP, LLC is the general partner of LL Capital Partners I, L.P. and exercises voting and dispositive power over the shares noted herein held by LL Capital Partners I, L.P. LLCP II GP, LLC is the managing member of SIF V, LLC and exercises voting and dispositive power over the shares noted herein held by SIF V, LLC. Roberto Sella, who is a member of the board of directors at the Company, is the sole manager of LLCP I GP, LLC. These securities are being registered for resale in accordance with the terms of the Registration Rights Agreement, as described under “
Certain Relationships and Related Party Transactions—Registration Rights Agreement
|
(7) |
These securities are being registered for resale in accordance with the terms of the Registration Rights Agreement, as described under “
Certain Relationships and Related Party Transactions—Registration Rights Agreement
|
(8) |
Consists of (i) 15,829,014 shares of Class A Common Stock and (ii) 2,885,690 shares of Class A Common Stock that would be issuable upon the exercise of options. Jerry Coleman was a co-founder of OfferPad, Inc. These securities are being registered for resale in accordance with the terms of the Registration Rights Agreement, as described under “
Certain Relationships and Related Party Transactions—Registration Rights Agreement
|
(9) |
Consists of (i) 2,648,229 shares of Class B Common Stock held by the BAB 2021 Irrevocable Trust, (ii) 12,168,007 shares of Class B Common Stock and (iii) 2,534,128 shares of Class A Common Stock that would be issuable upon the exercise of options. Brian Bair is the chief executive officer and chairman of the board of directors at the Company and served as an executive officer and director of OfferPad, Inc. prior to the Business Combination. These securities are being registered for resale in accordance with the terms of the Registration Rights Agreement, as described under “
Certain Relationships and Related Party Transactions—Registration Rights Agreement
|
(10) |
Consists of 1,129,912 shares of Class A Common Stock that would be issuable upon the exercise of options. Stephen Johnson is chief operating officer at the Company and served as an executive officer of OfferPad, Inc. prior to the Business Combination. These securities are being registered for resale in accordance with the terms of the Registration Rights Agreement, as described under “
Certain Relationships and Related Party Transactions—Registration Rights Agreement
|
(11) |
Consists of 1,129,912 shares of Class A Common Stock that would be issuable upon the exercise of options. Michael Burnett is chief financial officer at the Company and served as an executive officer of OfferPad, Inc. prior to the Business Combination. These securities are being registered for resale in accordance with the terms of the Registration Rights Agreement, as described under “
Certain Relationships and Related Party Transactions—Registration Rights Agreement
|
(12) |
Consists of 1,092,248 shares of Class A Common Stock that would be issuable upon the exercise of options. Benjamin Aronovitch is the chief financial officer at the Company and served as an executive officer of OfferPad, Inc. prior to the Business Combination. These securities are being registered for resale in accordance with the terms of the Registration Rights Agreement, as described under “
Certain Relationships and Related Party Transactions—Registration Rights Agreement
|
(13) |
Consists of (i) 4,500,000 shares of Class A Common Stock and (ii) 1,500,000 warrants to purchase shares of Class A Common Stock. Alexander Klabin, a member of the board of directors of the Company, controls the vote and disposition of shares held by Ancient 1604 LLC. These securities are being registered for resale in accordance with the terms of the Registration Rights Agreement, as described under “
Certain Relationships and Related Party Transactions—Registration Rights Agreement
|
(14) |
Roberto Sella is a member of the board of directors of the Company. These securities are being registered for resale in accordance with the terms of the Registration Rights Agreement, as described under “
Certain Relationships and Related Party Transactions—Registration Rights Agreement
|
(15) |
Spencer Rascoff, a member of the board of directors of the Company until completion of the Business Combination, controls the vote and disposition of shares held by 75 & Sunny LP. These securities are being registered for resale in accordance with the terms of the Registration Rights Agreement, as described under “
Certain Relationships and Related Party Transactions—Registration Rights Agreement
|
(16) |
Consists of (i) 8,101,775 shares of Class A Common Stock and (ii) 1,747,100 shares of Class A Common Stock that would be issuable upon the exercise of options. Vaughn Bair is the brother of Brian Bair, the Company’s chief executive officer and chairman of the board of directors, served as a member of the board of directors of OfferPad, Inc. prior to the Business Combination and is a
non-executive
employee at the Company. These securities are being registered for resale in accordance with the terms of the Registration Rights Agreement, as described under “
Certain Relationships and Related Party Transactions—Registration Rights Agreement
|
(17) |
Consists of (i) 5,445,335 shares of Class A Common Stock and (ii) 1,333,062 shares of Class A Common Stock that would be issuable upon exercise of options. Casey Bair is the brother of Brian Bair, the Company’s chief executive officer and chairman of the board of directors, and is an employee at the Company. These securities are being registered for resale in accordance with the terms of the Registration Rights Agreement, as described under “
Certain Relationships and Related Party Transactions—Registration Rights Agreement
|
(18) |
Consists of (i) 376,637 shares of Class A Common Stock and (ii) 1,024,641 shares of Class A Common Stock that would be issuable upon exercise of options. Darrin Shamo is a
non-executive
employee at the Company. These securities are being registered for resale in accordance with the terms of the Registration Rights Agreement, as described under “
Certain Relationships and Related Party Transactions—Registration Rights Agreement
|
(19) |
Formerly a director of Supernova Partners Acquisition Company, Inc. prior to the Business Combination.
|
• |
in whole and not in part;
|
• |
at a price of $0.01 per warrant;
|
• |
upon not less than 30 days’ prior written notice of redemption (the
“30-day
redemption period”) to each warrant holder; and
|
• |
if, and only if, the last reported sale price of our Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like and for certain issuances of our Class A common stock and equity-linked securities as described below) for any 20 trading days within a
30-trading
day period ending on the third trading day prior to the date we send the notice of redemption to the warrant holders.
|
• |
in whole and not in part;
|
• |
at $0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their warrants prior to redemption and receive that number of shares determined by reference to the table below, based on the redemption date and the “fair market value” of Class A common stock (as defined below) except as otherwise described below;
|
• |
if, and only if, the last reported sale price of our Class A common stock equals or exceeds $10.00 per share (as adjusted per stock splits, stock dividends, reorganizations, reclassifications, recapitalizations and the like and for certain issuances of our Class A common stock and equity-linked securities as described above) on the trading day prior to the date on which we send the notice of redemption to the warrant holders; and
|
• |
if, and only if, the private placement warrants are also concurrently exchanged at the same price (equal to a number of shares of our Class A common stock) as the outstanding public warrants, as described above.
|
• |
purchases by a broker-dealer as principal and resale by such broker-dealer for its own account pursuant to this prospectus;
|
• |
ordinary brokerage transactions and transactions in which the broker solicits purchasers;
|
• |
block trades in which the broker-dealer so engaged will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction;
|
• |
an
over-the-counter
|
• |
through trading plans entered into by a Selling Securityholder pursuant to
Rule 10b5-1
under the Exchange Act, that are in place at the time of an offering pursuant to this prospectus and any applicable prospectus supplement hereto that provide for periodic sales of their securities on the basis of parameters described in such trading plans;
|
• |
to or through underwriters or broker-dealers;
|
• |
settlement of short sales entered into after the date of this prospectus;
|
• |
in “at the market” offerings, as defined in Rule 415 under the Securities Act, at negotiated prices, at prices prevailing at the time of sale or at prices related to such prevailing market prices, including sales made directly on a national securities exchange or sales made through a market maker other than on an exchange or other similar offerings through sales agents;
|
• |
through loans or pledges of the shares, including to a broker-dealer or an affiliate thereof;
|
• |
in privately negotiated transactions;
|
• |
in options transactions;
|
• |
through a combination of any of the above methods of sale; or
|
• |
any other method permitted pursuant to applicable law.
|
Page
|
||||
Unaudited condensed consolidated financial statements
As of June 30, 2021 and December 31, 2020 and for the three and six months ended June 30, 2021 and 2020
|
||||
Financial Statements:
|
||||
F-2 | ||||
F-4 | ||||
F-5 | ||||
F-7 | ||||
F-8 | ||||
Consolidated financial statements (audited)
|
||||
As of December 31, 2020 and 2019 and for the years ended December 31, 2020, 2019 and 2018
|
||||
F-26 | ||||
Financial Statements:
|
||||
F-27 | ||||
F-28 | ||||
F-29 | ||||
F-30 | ||||
F-31 |
Unaudited condensed consolidated financial statements
|
||||
Financial Statements: | ||||
F-48
|
||||
F-49
|
||||
F-50
|
||||
F-51
|
||||
F-52
|
||||
Consolidated financial statements (audited)
|
||||
As of December 31, 2020 and for the period from August 31, 2020 (inception) through December 31, 2020
|
||||
F-71 | ||||
Financial Statements:
|
||||
F-72 | ||||
F-73 | ||||
F-74 | ||||
F-75 | ||||
F-76 |
June 30,
|
December 31,
|
|||||||
2021
|
2020
|
|||||||
Temporary Equity:
|
||||||||
Series A convertible preferred stock, 2,789 shares authorized at June 30, 2021 and December 31, 2020; 2,775 shares issued and outstanding at June 30, 2021 and December 31, 2020; liquidation preference of $15,099 at June 30, 2021 and December 31, 2020
|
14,921 | 14,921 | ||||||
Series
A-1
convertible preferred stock, 1,448 shares authorized, issued and outstanding at June 30, 2021 and December 31, 2020; liquidation preference of $7,500 at June 30, 2021 and December 31, 2020
|
7,470 | 7,470 | ||||||
Series
A-2
convertible preferred stock, 1,105 shares authorized, issued and outstanding at June 30, 2021 and December 31, 2020; liquidation preference of $7,500 at June 30, 2021 and December 31, 2020
|
7,463 | 7,463 | ||||||
Series B convertible preferred stock, 7,751 shares authorized, issued and outstanding at June 30, 2021 and December 31, 2020; liquidation preference of $50,000 at June 30, 2021 and December 31, 2020
|
49,845 | 49,845 | ||||||
Series C convertible preferred stock, 7,529 shares authorized at June 30, 2021 and December 31, 2020; 5,308 shares issued and outstanding at June 30, 2021 and December 31, 2020; liquidation preference of $105,750 at June 30, 2021 and December 31, 2020
|
104,424 | 104,424 | ||||||
|
|
|
|
|||||
Total temporary equity
|
184,123 | 184,123 | ||||||
|
|
|
|
|||||
Stockholders’ Deficit:
|
||||||||
Common stock, 34,077 shares authorized at June 30, 2021 and December 31, 2020; $0.00001 par value; 7,920 and 7,682 shares issued and outstanding at June 30, 2021 and December 31, 2020, respectively
|
— | — | ||||||
Additional paid in capital
|
7,653 | 5,908 | ||||||
Accumulated deficit
|
(129,559 | ) | (138,516 | ) | ||||
Treasury stock
|
(10,650 | ) | (10,650 | ) | ||||
|
|
|
|
|||||
Total stockholders’ deficit
|
(132,556 | ) | (143,258 | ) | ||||
|
|
|
|
|||||
TOTAL LIABILITIES, TEMPORARY EQUITY, AND STOCKHOLDERS’ DEFICIT
|
$ 573,327
|
$ 235,873
|
||||||
|
|
|
|
(1) |
Our consolidated assets at June 30, 2021 and December 31, 2020 include the following assets of certain variable interest entities (“VIEs”) that can only be used to settle the liabilities of those VIEs: Restricted cash, $13,341 and $6,804; Accounts receivable, $6,492 and $1,638; Inventory, $479,435 and $171,212; Prepaid expenses and other current assets, $2,354 and $1,036; Property and equipment, net, $6,857 and $2,772; Total assets of $508,479 and $183,462, respectively.
|
(2) |
Our consolidated liabilities at June 30, 2021 and December 31, 2020 include the following liabilities for which the VIE creditors do not have recourse to Offerpad: Accounts payable, $2,962 and $716; Accrued liabilities, $1,047 and $575; Current portion of secured credit facilities and notes payable, net, $446,727 and $173,539; Noncurrent portion of secured credit facilities and notes payable, net, $0 and $653; Total liabilities, $450,736 and $175,483, respectively.
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
June 30,
|
June 30,
|
|||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||
Revenue
|
$ | 378,647 | $ | 287,007 | $ | 662,619 | $ | 654,662 | ||||||||
Cost of revenue
|
327,783 | 269,146 | 578,218 | 611,903 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Gross profit
|
50,864 | 17,861 | 84,401 | 42,759 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Operating expenses:
|
||||||||||||||||
Sales, marketing and operating
|
31,595 | 17,547 | 56,671 | 42,976 | ||||||||||||
General and administrative
|
5,137 | 3,862 | 9,871 | 8,223 | ||||||||||||
Technology and development
|
2,603 | 1,692 | 4,886 | 3,821 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total operating expenses
|
39,335 | 23,101 | 71,428 | 55,020 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net Income (loss) from operations
|
11,529 | (5,240 | ) | 12,973 | (12,261 | ) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Other income (expense):
|
||||||||||||||||
Interest expense
|
(2,257 | ) | (2,418 | ) | (4,175 | ) | (7,092 | ) | ||||||||
Other income, net
|
7 | 268 | 248 | 498 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total other expense
|
(2,250 | ) | (2,150 | ) | (3,927 | ) | (6,594 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net Income (loss) before income taxes
|
9,279 | (7,390 | ) | 9,046 | (18,855 | ) | ||||||||||
Income tax expense
|
(89 | ) | — | (89 | ) | — | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net Income (loss)
|
$ | 9,190 | $ | (7,390 | ) | $ | 8,957 | $ | (18,855 | ) | ||||||
|
|
|
|
|
|
|
|
|||||||||
Net Income (loss) per share, basic
|
$ | 1.17 | $ | (0.96 | ) | $ | 1.14 | $ | (2.45 | ) | ||||||
|
|
|
|
|
|
|
|
|||||||||
Net Income (loss) per share, diluted
|
$ | 0.31 | $ | (0.96 | ) | $ | 0.30 | $ | (2.45 | ) | ||||||
|
|
|
|
|
|
|
|
|||||||||
Weighted average common shares outstanding, basic
|
7,884 | 7,682 | 7,830 | 7,682 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Weighted average common shares outstanding, diluted
|
29,796 | 7,682 | 29,748 | 7,682 | ||||||||||||
|
|
|
|
|
|
|
|
Temporary Equity
|
Stockholders’ Deficit
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Series A
Convertible Preferred Stock |
Series
A-1
Convertible Preferred Stock |
Series
A-2
Convertible Preferred Stock |
Series B
Convertible Preferred Stock |
Series C
Convertible Preferred Stock |
Total
Temporary
Equity
|
Common
Stock |
Additional
Paid in
Capital
|
Accumulated
Deficit
|
Treasury Stock
|
Total
Stockholders’
Deficit
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2021
|
2,775 | $ | 14,921 | 1,448 | $ | 7,470 | 1,105 | $ | 7,463 | 7,751 | $ | 49,845 | 5,308 | $ | 104,424 | $ | 184,123 | 7,846 | $ | — | $ | 6,766 | $ | (138,749 | ) | 636 | $ | (10,650 | ) | $ | (142,633 | ) | ||||||||||||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options
|
— | — | — | — | — | — | — | — | — | — | — | 74 | — | 174 | — | — | — | 174 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Vesting of early exercised stock options
|
— | — | — | — | — | — | — | — | — | — | — | — | — | 64 | — | — | — | 64 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense
|
— | — | — | — | — | — | — | — | — | — | — | — | — | 649 | — | — | — | 649 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income
|
— | — | — | — | — | — | — | — | — | — | — | — | — | — | 9,190 | — | — | 9,190 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
Balance at June 30, 2021
|
2,775 | $ | 14,921 | 1,448 | $ | 7,470 | 1,105 | $ | 7,463 | 7,751 | $ | 49,845 | 5,308 | $ | 104,424 | $ | 184,123 | 7,920 | $ | — | $ | 7,653 | $ | (129,559 | ) | 636 | $ | (10,650 | ) | $ | (132,556 | ) | ||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Temporary Equity
|
Stockholders’ Deficit
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Series A
Convertible Preferred Stock |
Series
A-1
Convertible Preferred Stock |
Series
A-2
Convertible Preferred Stock |
Series B
Convertible Preferred Stock |
Series C
Convertible Preferred Stock |
Total
Temporary
Equity
|
Common
Stock |
Additional
Paid in
Capital
|
Accumulated
Deficit
|
Treasury Stock
|
Total
Stockholders’
Deficit
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2020
|
2,775 | $ | 14,921 | 1,448 | $ | 7,470 | 1,105 | $ | 7,463 | 7,751 | $ | 49,845 | 4,881 | $ | 96,778 | $ | 176,477 | 7,682 | $ | — | $ | 4,794 | $ | (126,863 | ) | 636 | $ | (10,650 | ) | $ | (132,719 | ) | ||||||||||||||||||||||||||||||||||||||||
Issuance of Series C (extension) stock, net of offering costs
|
— | — | — | — | — | — | — | — | 427 | 7,646 | 7,646 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense
|
— | — | — | — | — | — | — | — | — | — | — | — | — | 289 | — | — | — | 289 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss
|
— | — | — | — | — | — | — | — | — | — | — | — | — | — | (7,390 | ) | — | — | (7,390 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
Balance at June 30, 2020
|
2,775 | $ | 14,921 | 1,448 | $ | 7,470 | 1,105 | $ | 7,463 | 7,751 | $ | 49,845 | 5,308 | $ | 104,424 | $ | 184,123 | 7,682 | $ | — | $ | 5,083 | $ | (134,253 | ) | 636 | $ | (10,650 | ) | $ | (139,820 | ) | ||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Temporary Equity
|
Stockholders’ Deficit
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Series A
Convertible Preferred Stock |
Series
A-1
Convertible Preferred Stock |
Series
A-2
Convertible Preferred Stock |
Series B
Convertible Preferred Stock |
Series C
Convertible Preferred Stock |
Total
Temporary
Equity
|
Common
Stock |
Additional
Paid in
Capital
|
Accumulated
Deficit
|
Treasury Stock
|
Total
Stockholders’
Deficit
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2020
|
2,775 | $ | 14,921 | 1,448 | $ | 7,470 | 1,105 | $ | 7,463 | 7,751 | $ | 49,845 | 5,308 | $ | 104,424 | $ | 184,123 | 7,682 | $ | — | $ | 5,908 | $ | (138,516 | ) | 636 | $ | (10,650 | ) | $ | (143,258 | ) | ||||||||||||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options
|
— | — | — | — | — | — | — | — | — | — | — | 210 | — | 375 | — | — | — | 375 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock upon early exercise of stock options
|
— | — | — | — | — | — | — | — | — | — | — | 28 | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Vesting of early exercised stock options
|
— | — | — | — | — | — | — | — | — | — | — | — | — | 107 | — | — | — | 107 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense
|
— | — | — | — | — | — | — | — | — | — | — | — | — | 1,263 | — | — | — | 1,263 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income
|
— | — | — | — | — | — | — | — | — | — | — | — | — | — | 8,957 | — | — | 8,957 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
Balance at June 30, 2021
|
2,775 | $ | 14,921 | 1,448 | $ | 7,470 | 1,105 | $ | 7,463 | 7,751 | $ | 49,845 | 5,308 | $ | 104,424 | $ | 184,123 | 7,920 | $ | — | $ | 7,653 | $ | (129,559 | ) | 636 | $ | (10,650 | ) | $ | (132,556 | ) | ||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Temporary Equity
|
Stockholders’ Deficit
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Series A
Convertible Preferred Stock |
Series
A-1
Convertible Preferred Stock |
Series
A-2
Convertible Preferred Stock |
Series B
Convertible Preferred Stock |
Series C
Convertible Preferred Stock |
Total
Temporary
Equity
|
Common
Stock |
Additional
Paid in
Capital
|
Accumulated
Deficit
|
Treasury Stock
|
Total
Stockholders’
Deficit
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2019
|
2,775 | $ | 14,921 | 1,448 | $ | 7,470 | 1,105 | $ | 7,463 | 7,751 | $ | 49,845 | 3,765 | $ | 74,601 | $ | 154,300 | 7,682 | $ | — | $ | 4,545 | $ | (115,398 | ) | 636 | $ | (10,650 | ) | $ | (121,503 | ) | ||||||||||||||||||||||||||||||||||||||||
Issuance of Series C (extension) stock, net of offering costs
|
— | — | — | — | — | — | — | — | 1,543 | 29,823 | 29,823 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense
|
— | — | — | — | — | — | — | — | — | — | — | — | — | 538 | — | — | — | 538 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss
|
— | — | — | — | — | — | — | — | — | — | — | — | — | — | (18,855 | ) | — | — | (18,855 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
Balance at June 30, 2020
|
2,775 | $ | 14,921 | 1,448 | $ | 7,470 | 1,105 | $ | 7,463 | 7,751 | $ | 49,845 | 5,308 | $ | 104,424 | $ | 184,123 | 7,682 | $ | — | $ | 5,083 | $ | (134,253 | ) | 636 | $ | (10,650 | ) | $ | (139,820 | ) | ||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
|
||||||||
June 30,
|
||||||||
2021
|
2020
|
|||||||
Cash flows from operating activities:
|
||||||||
Net Income (loss)
|
$ | 8,957 | $ | (18,855 | ) | |||
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:
|
||||||||
Depreciation
|
277 | 204 | ||||||
Gain on sale
|
(246 | ) | — | |||||
Amortization of debt financing costs
|
209 | 89 | ||||||
Impairment of inventory
|
339 | 2,908 | ||||||
Stock-based compensation
|
1,263 | 538 | ||||||
Changes in operating assets and liabilities:
|
||||||||
Accounts receivable
|
(4,808 | ) | (497 | ) | ||||
Inventory
|
(311,840 | ) | 219,505 | |||||
Prepaid expenses and other current assets
|
(10,108 | ) | 764 | |||||
Accounts payable
|
3,153 | 650 | ||||||
Accrued liabilities
|
15,274 | (2,346 | ) | |||||
|
|
|
|
|||||
Net cash (used in) provided by operating activities
|
(297,530 | ) | 202,960 | |||||
|
|
|
|
|||||
Cash flows from investing activities:
|
||||||||
Purchases of property and equipment
|
(5,942 | ) | (11 | ) | ||||
Proceeds from sales of property and equipment
|
2,032 | — | ||||||
|
|
|
|
|||||
Net cash used in investing activities
|
(3,910 | ) | (11 | ) | ||||
|
|
|
|
|||||
Cash flows from financing activities:
|
||||||||
Borrowings from credit facilities and notes payable
|
888,970 | 395,455 | ||||||
Repayments of credit facilities and notes payable
|
(580,819 | ) | (608,781 | ) | ||||
Payment of debt financing costs
|
(185 | ) | (356 | ) | ||||
Proceeds from issuance of Class C preferred stock, net
|
— | 29,823 | ||||||
Proceeds from exercise of stock options
|
633 | — | ||||||
|
|
|
|
|||||
Net cash provided by (used in) financing activities
|
308,599 | (183,859 | ) | |||||
|
|
|
|
|||||
Net change in cash, cash equivalents and restricted cash
|
7,159 | 19,090 | ||||||
Cash, cash equivalents and restricted cash, beginning of period
|
50,742 | 29,883 | ||||||
|
|
|
|
|||||
Cash, cash equivalents and restricted cash, end of period
|
$ | 57,901 | $ | 48,973 | ||||
|
|
|
|
|||||
Reconciliation of cash, cash equivalents and restricted cash to the consolidated balance sheet:
|
||||||||
Cash and cash equivalents
|
$ | 44,560 | $ | 43,785 | ||||
Restricted cash
|
13,341 | 5,188 | ||||||
|
|
|
|
|||||
Total cash, cash equivalents and restricted cash
|
$ | 57,901 | $ | 48,973 | ||||
|
|
|
|
|||||
Supplemental disclosure of cash flow information:
|
||||||||
Cash payments for interest
|
$ | 5,537 | $ | 9,919 | ||||
|
|
|
|
1.
|
BUSINESS ACTIVITY
|
2.
|
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
Property and Equipment
|
Estimated Useful Life
|
|
Rooftop solar panel systems | Thirty years | |
Properties held for use | Twenty seven and a half years | |
Leasehold improvements | Lesser of estimated useful life or remaining lease term |
Property and Equipment
|
Estimated Useful Life
|
|
Computers and equipment | Five years | |
Office equipment and furniture | Seven years | |
Software systems | Four to five years |
3.
|
INVENTORY
|
June 30,
|
December 31,
|
|||||||
2021
|
2020
|
|||||||
Homes under renovation
|
$ | 196,738 | $ | 47,978 | ||||
Homes listed for sale
|
111,435 | 30,826 | ||||||
Homes under contract to sell
|
174,687 | 92,555 | ||||||
|
|
|
|
|||||
Total inventory
|
$ | 482,860 | $ | 171,359 | ||||
|
|
|
|
4.
|
PROPERTY AND EQUIPMENT
|
June 30,
|
December 31,
|
|||||||
2021
|
2020
|
|||||||
Rooftop solar panel systems
|
$ | 5,075 | $ | 5,094 | ||||
Properties held for use
|
6,915 | 2,790 | ||||||
Leasehold improvements
|
772 | 749 | ||||||
Computers and equipment
|
265 | 265 | ||||||
Office equipment and furniture
|
70 | 70 | ||||||
Software systems
|
318 | 318 | ||||||
|
|
|
|
|||||
13,415 | 9,286 | |||||||
Less accumulated depreciation
|
(1,305 | ) | (1,055 | ) | ||||
|
|
|
|
|||||
Total property and equipment, net
|
$ | 12,110 | $ | 8,231 | ||||
|
|
|
|
5.
|
ACCRUED LIABILITIES
|
June 30,
|
December 31,
|
|||||||
2021
|
2020
|
|||||||
Compensation
|
$ | 8,956 | $ | 6,180 | ||||
Marketing
|
7,492 | 1,035 | ||||||
Legal and professional obligations
|
6,570 | 314 | ||||||
Payroll tax
|
1,568 | 1,250 | ||||||
Interest
|
1,166 | 699 | ||||||
Other
|
854 | 1,703 | ||||||
|
|
|
|
|||||
Total accrued liabilities
|
$ | 26,606 | $ | 11,181 | ||||
|
|
|
|
6.
|
CREDIT FACILITIES AND NOTES PAYABLE
|
June 30,
|
December 31,
|
|||||||
2021
|
2020
|
|||||||
Credit facilities and notes payable, net
|
||||||||
Senior secured credit facility with a financial institution
|
$ | 229,390 | $ | 49,544 | ||||
Senior secured credit facility with a related party
|
159,810 | 105,397 | ||||||
Mezzanine credit facility with a related party
|
28,674 | 6,195 | ||||||
Mezzanine credit facility with a related party
|
34,621 | 13,056 | ||||||
Secured term loan with a related party
|
30,000 | — | ||||||
Secured notes payable
|
3,868 | — | ||||||
Notes payable with related parties
|
2,424 | 2,385 | ||||||
Notes payable
-
other
|
1,250 | 5,309 | ||||||
Debt issuance costs
|
(185 | ) | (208 | ) | ||||
|
|
|
|
|||||
Total credit facilities and notes payable, net
|
489,852 | 181,678 | ||||||
Current portion
-
credit facilities and notes payable, net
|
||||||||
Total credit facilities and notes payable, net
-
related party
|
255,344 | 126,825 | ||||||
Total credit facilities and notes payable
|
234,508 | 50,143 | ||||||
Non current portion
-
credit facilities and notes payable, net
|
||||||||
Total credit facilities and notes payable
|
— | 4,710 | ||||||
|
|
|
|
|||||
Total credit facilities and notes payable, net
|
489,852 | 181,678 |
As of June 30, 2021
|
Borrowing
Capacity
|
Outstanding
Amount
|
Weighted-
Average
Interest Rate
|
Maturity
Date
|
||||||||||
Senior secured credit facility with a financial institution
|
$ | 250,000 | $ | 229,390 | 2.60 | % | August 2022 | |||||||
Senior secured credit facility with a related party
|
225,000 | 159,810 | 4.12 | % | December 2022 | |||||||||
|
|
|
|
|||||||||||
$ | 475,000 | $ | 389,200 | |||||||||||
|
|
|
|
As of December 31, 2020
|
Borrowing
Capacity
|
Outstanding
Amount
|
Weighted-
Average
Interest Rate
|
|||||||||||||
Senior secured credit facility with a financial institution
|
$ | 200,000 | $ | 49,544 | 3.72 | % | August 2022 | |||||||||
Senior secured credit facility with a related party
|
225,000 | 105,397 | 5.28 | % | December 2022 | |||||||||||
|
|
|
|
|||||||||||||
$ | 425,000 | $ | 154,941 | |||||||||||||
|
|
|
|
As of June 30, 2021
|
Borrowing
Capacity
|
Outstanding
Amount
|
Weighted-
Average Interest Rate |
Maturity Date
|
||||||||||
Mezzanine credit facility with a related party
|
$ | 31,250 | $ | 28,674 | 13.00 | % | February 2023 | |||||||
Mezzanine credit facility with a related party
|
43,450 | 34,621 | 13.00 | % | December 2022 | |||||||||
|
|
|
|
|||||||||||
$ | 74,700 | $ | 63,295 | |||||||||||
|
|
|
|
|||||||||||
As of December 31, 2020
|
Borrowing
Capacity
|
Outstanding
Amount
|
Weighted-
Average Interest Rate |
|||||||||||
Mezzanine credit facility with a related party
|
$ | 25,000 | $ | 6,195 | 13.00 | % | February 2023 | |||||||
Mezzanine credit facility with a related party
|
43,450 | 13,056 | 13.34 | % | December 2022 | |||||||||
|
|
|
|
|||||||||||
$ | 68,450 | $ | 19,251 | |||||||||||
|
|
|
|
7.
|
TEMPORARY EQUITY AND STOCKHOLDERS’ DEFICIT
|
8.
|
STOCK-BASED AWARDS
|
Options
Issued
Under Plan
(in thousands)
|
Nonemployee
Options
(in thousands)
|
Total
Options
(in thousands)
|
Weighted-
Average Exercise Price
Per Share
|
Weighted-Average
Remaining
Contractual
Term
(in years)
|
Aggregate
Intrinsic
Value
(in thousands)
|
|||||||||||||||||||
Outstanding as of December 31, 2020
|
3,462 | 201 | 3,663 | $ | 5.09 | 7.40 | $ | 14,619 | ||||||||||||||||
Granted
|
207 | — | 207 | 9.19 | ||||||||||||||||||||
Exercised
|
(166 | ) | (72 | ) | (238 | ) | 2.66 | |||||||||||||||||
Forfeitures
|
(27 | ) | (24 | ) | (51 | ) | 5.77 | |||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
Outstanding as of June 30, 2021
|
3,476 | 105 | 3,581 | 5.49 | 7.33 | 148,635 | ||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
Exercisable as of June 30, 2021
|
1,423 | 3.72 | 6.76 | 66,041 | ||||||||||||||||||||
|
|
|||||||||||||||||||||||
Vested and expected to vest as of June 30, 2021
|
3,581 | 5.49 | 7.33 | 148,635 | ||||||||||||||||||||
|
|
2021
|
||
Expected term (in years)
|
5.97-6.10
|
|
Risk-free interest rate
|
0.64% - 0.67%
|
|
Expected volatility
|
52.49% - 52.69%
|
|
Dividend yield
|
0.00% | |
Fair value on grant date
|
$4.49 -$4.55 |
9.
|
VARIABLE INTEREST ENTITIES
|
June 30,
|
December 31,
|
|||||||
2021
|
2020
|
|||||||
Assets
|
||||||||
Restricted cash
|
$ | 13,341 | $ | 6,804 | ||||
Accounts receivable
|
6,492 | 1,638 | ||||||
Inventory
|
479,435 | 171,212 | ||||||
Prepaid expenses and other current assets
|
2,354 | 1,036 | ||||||
Property and equipment, net
|
6,857 | 2,772 | ||||||
|
|
|
|
|||||
Total assets
|
$ | 508,479 | $ | 183,462 | ||||
|
|
|
|
|||||
Liabilities
|
||||||||
Accounts payable
|
$ | 2,962 | $ | 716 | ||||
Accrued liabilities
|
1,047 | 575 | ||||||
Secured credit facilities and notes payable, net - current portion
|
446,727 | 173,539 | ||||||
Secured credit facilities and notes payable - net of current portion
|
— | 653 | ||||||
|
|
|
|
|||||
Total liabilities
|
$ | 450,736 | $ | 175,483 | ||||
|
|
|
|
10.
|
EARNINGS PER SHARE
|
Three Months Ended
June 30, |
Six Months Ended
June 30, |
|||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||
Numerator:
|
||||||||||||||||
Net Income (loss)
|
$ | 9,190 | $ | (7,390 | ) | $ | 8,957 | $ | (18,855 | ) | ||||||
Denominator:
|
||||||||||||||||
Weighted average common shares outstanding, basic
|
7,884 | 7,682 | 7,830 | 7,682 | ||||||||||||
Dilutive effect of preferred stock
(1)
|
18,401 | — | 18,401 | — | ||||||||||||
Dilutive effect of stock options
(1)
|
3,285 | — | 3,291 | — | ||||||||||||
Dilutive effect of warrants
(1)
|
226 | — | 226 | — | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Weighted average common shares outstanding, diluted
|
29,796 | 7,682 | 29,748 | 7,682 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net Income (loss) per share, basic
|
$ | 1.17 | $ | (0.96 | ) | $ | 1.14 | $ | (2.45 | ) | ||||||
Net Income (loss) per share, diluted
|
$ | 0.31 | $ | (0.96 | ) | $ | 0.30 | $ | (2.45 | ) | ||||||
Anti-dilutive securities excluded from diluted income (loss) per share:
|
||||||||||||||||
Anti-dilutive preferred stock
(1)
|
— | 18,401 | — | 18,401 | ||||||||||||
Anti-dilutive stock options
(1)
|
— | 3,052 | — | 3,052 | ||||||||||||
Anti-dilutive warrants
(1)
|
— | 251 | — | 251 |
(1)
|
Due to the net loss during the three and six months ended June 30, 2020, no dilutive securities were included in the calculation of diluted loss per share because they would have been anti-dilutive.
|
11.
|
INCOME TAXES
|
12.
|
RELATED-PARTY TRANSACTIONS
|
13.
|
COMMITMENTS AND CONTINGENCIES
|
Remainder of 2021
|
$ | 2,041 | ||
2022
|
1,664 | |||
2023
|
1,342 | |||
2024
|
1,131 | |||
2025
|
506 | |||
2026
|
1 | |||
|
|
|||
$ | 6,685 | |||
|
|
14.
|
SUBSEQUENT EVENTS
|
• |
former Offerpad stockholders having the largest voting interest in Offerpad Solutions;
|
• |
the board of directors of Offerpad Solutions having 7 members, and Offerpad’s former stockholders having the ability to nominate the majority of the members of the board of directors;
|
• |
Offerpad management continuing to hold executive management roles for the post-combination company and being responsible for
the day-to-day operations;
|
• |
the post-combination company assuming the Offerpad name;
|
• |
Offerpad Solutions maintaining the
pre-existing
Offerpad headquarters; and
|
• |
the intended strategy of Offerpad Solutions being a continuation of Offerpad’s strategy.
|
(1) |
Our consolidated assets at December 31, 2020 and 2019 include the following assets of certain variable interest entities (“VIEs”) that can only be used to settle the liabilities of those VIEs: Restricted cash, $6,804 and $7,027; Accounts receivable, $1,638 and $2,554; Inventory, $171,212 and $342,502; Prepaid expenses and other current assets, $1,036 and $1,368; Property and equipment, net, $2,772 and $0; Total assets of $183,462 and $353,451, respectively.
|
(2) |
Our consolidated liabilities at December 31, 2020 and 2019 include the following liabilities for which the VIE creditors do not have recourse to Offerpad: Accounts payable, $716 and $1,253; Accrued liabilities, $575 and $1,843; Current portion of secured credit facilities and notes payable, net, $173,539 and $334,230; Noncurrent portion of secured credit facilities and notes payable, net, $653 and $0; Total liabilities, $175,483 and $337,326, respectively.
|
Years Ended December 31,
|
||||||||||||
2020
|
2019
|
2018
|
||||||||||
Revenue
|
$ | 1,064,257 | $ | 1,075,882 | $ | 855,961 | ||||||
Cost of revenue
|
976,478 | 1,001,495 | 790,100 | |||||||||
|
|
|
|
|
|
|||||||
Gross profit
|
87,779 | 74,387 | 65,861 | |||||||||
|
|
|
|
|
|
|||||||
Operating expenses:
|
||||||||||||
Sales, marketing and operating
|
76,786 | 85,226 | 64,695 | |||||||||
General and administrative
|
17,481 | 15,111 | 11,550 | |||||||||
Technology and development
|
7,270 | 7,450 | 3,718 | |||||||||
|
|
|
|
|
|
|||||||
Total operating expenses
|
101,537 | 107,787 | 79,963 | |||||||||
|
|
|
|
|
|
|||||||
Loss from operations
|
(13,758 | ) | (33,400 | ) | (14,102 | ) | ||||||
|
|
|
|
|
|
|||||||
Other income (expense):
|
||||||||||||
Interest expense
|
(10,031 | ) | (18,298 | ) | (18,329 | ) | ||||||
Other income, net
|
834 | — | — | |||||||||
|
|
|
|
|
|
|||||||
Total other expense
|
(9,197 | ) | (18,298 | ) | (18,329 | ) | ||||||
|
|
|
|
|
|
|||||||
Loss before income taxes
|
(22,955 | ) | (51,698 | ) | (32,431 | ) | ||||||
Income tax expense
|
(163 | ) | (254 | ) | (506 | ) | ||||||
|
|
|
|
|
|
|||||||
Net loss
|
$ | (23,118 | ) | $ | (51,952 | ) | $ | (32,937 | ) | |||
|
|
|
|
|
|
|||||||
Net loss per share, basic and diluted
|
$ | (3.01 | ) | $ | (6.76 | ) | $ | (3.99 | ) | |||
|
|
|
|
|
|
|||||||
Weighted average common shares outstanding, basic and diluted
|
7,681,832 | 7,679,564 | 8,254,134 | |||||||||
|
|
|
|
|
|
Temporary Equity
|
Stockholders’ Deficit
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Series A
Convertible |
Series
A-1
Convertible |
Series
A-2
Convertible |
Series B
Convertible |
Series C
Convertible |
Total
|
Additional
|
Total
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred Stock | Preferred Stock | Preferred Stock | Preferred Stock | Preferred Stock |
Temporary
|
Common Stock
|
Paid in
|
Accumulated
|
Treasury Stock
|
Stockholders’
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Shares
|
Amount
|
Equity
|
Shares
|
Amount
|
Capital
|
Deficit
|
Shares
|
Amount
|
Deficit
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2017
|
2,775,483 | $ | 14,921 | 1,447,693 | $ | 7,470 | 1,104,818 | $ | 7,463 | — | $ | — | — | $ | — | $ | 29,854 | 8,272,133 | $ | — | $ | 2,214 | $ | (30,509 | ) | — | $ | — | $ | (28,295 | ) | |||||||||||||||||||||||||||||||||||||||||||
Issuance of Series B Stock, net of offering costs
|
— | — | — | — | — | — | 4,930,074 | 31,646 | — | — | 31,646 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion of promissory note
|
— | — | — | — | — | — | 2,821,383 | 18,199 | — | — | 18,199 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cancellation of shares
|
— | — | — | — | — | — | — | — | — | — | — | (30,350 | ) | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense
|
— | — | — | — | — | — | — | — | — | — | — | — | — | 893 | — | — | — | 893 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss
|
— | — | — | — | — | — | — | — | — | — | — | — | — | — | (32,937 | ) | — | — | (32,937 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2018
|
2,775,483 | $ | 14,921 | 1,447,693 | $ | 7,470 | 1,104,818 | $ | 7,463 | 7,751,457 | $ | 49,845 | — | $ | — | $ | 79,699 | 8,241,783 | $ | — | $ | 3,107 | $ | (63,446 | ) | — | $ | — | $ | (60,339 | ) | |||||||||||||||||||||||||||||||||||||||||||
Issuance of Series C Stock, net of offering costs
|
— | — | — | — | — | — | — | — | 3,764,606 | 74,601 | 74,601 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Repurchased shares
|
— | — | — | — | — | — | — | — | — | — | — | (636,396 | ) | — | — | — | 636,396 | (10,650 | ) | (10,650 | ) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense
|
— | — | — | — | — | — | — | — | — | — | — | — | — | 1,268 | — | — | — | 1,268 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options
|
— | — | — | — | — | — | — | — | — | — | — | 76,445 | — | 170 | — | — | — | 170 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss
|
— | — | — | — | — | — | — | — | — | — | — | — | — | — | (51,952 | ) | — | — | (51,952 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2019
|
2,775,483 | $ | 14,921 | 1,447,693 | $ | 7,470 | 1,104,818 | $ | 7,463 | 7,751,457 | $ | 49,845 | 3,764,606 | $ | 74,601 | $ | 154,300 | 7,681,832 | $ | — | $ | 4,545 | $ | (115,398 | ) | 636,396 | $ | (10,650 | ) | $ | (121,503 | ) | ||||||||||||||||||||||||||||||||||||||||||
Issuance of Series C (extension) stock, net of offering costs
|
— | — | — | — | — | — | — | — | 1,543,487 | 29,823 | 29,823 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense
|
— | — | — | — | — | — | — | — | — | — | — | — | — | 1,363 | — | — | — | 1,363 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss
|
— | — | — | — | — | — | — | — | — | — | — | — | — | — | (23,118 | ) | — | — | (23,118 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2020
|
2,775,483 | $ | 14,921 | 1,447,693 | $ | 7,470 | 1,104,818 | $ | 7,463 | 7,751,457 | $ | 49,845 | 5,308,093 | $ | 104,424 | $ | 184,123 | 7,681,832 | $ | — | $ | 5,908 | $ | (138,516 | ) | 636,396 | $ | (10,650 | ) | $ | (143,258 | ) | ||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years Ended December 31,
|
||||||||||||
2020
|
2019
|
2018
|
||||||||||
Cash flows from operating activities:
|
||||||||||||
Net loss
|
$ | (23,118 | ) | $ | (51,952 | ) | $ | (32,937 | ) | |||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
|
||||||||||||
Depreciation
|
434 | 377 | 192 | |||||||||
Amortization of debt financing costs
|
262 | 40 | — | |||||||||
Accrued interest on convertible debt
|
— | — | 670 | |||||||||
Impairment of inventory
|
3,170 | 3,002 | 2,271 | |||||||||
Stock-based compensation
|
1,363 | 1,268 | 893 | |||||||||
Changes in operating assets and liabilities:
|
||||||||||||
Accounts receivable
|
937 | (1,075 | ) | 470 | ||||||||
Inventory
|
169,079 | (60,731 | ) | (52,992 | ) | |||||||
Prepaid expenses and other current assets
|
115 | (937 | ) | (994 | ) | |||||||
Accounts payable
|
841 | (2,421 | ) | 3,504 | ||||||||
Accrued liabilities
|
1,781 | 3,455 | 236 | |||||||||
|
|
|
|
|
|
|||||||
Net cash provided by (used in) operating activities
|
154,864 | (108,974 | ) | (78,687 | ) | |||||||
|
|
|
|
|
|
|||||||
Cash flows from investing activities:
|
||||||||||||
Purchases of property and equipment
|
(2,858 | ) | (1,039 | ) | (2,261 | ) | ||||||
Proceeds from sales of property and equipment
|
— | 60 | 234 | |||||||||
|
|
|
|
|
|
|||||||
Net cash used in investing activities
|
(2,858 | ) | (979 | ) | (2,027 | ) | ||||||
|
|
|
|
|
|
|||||||
Cash flows from financing activities:
|
||||||||||||
Borrowings from secured credit facilities and notes payable
|
799,997 | 1,077,781 | 775,326 | |||||||||
Repayments of secured credit facilities and notes payable
|
(960,510 | ) | (1,019,347 | ) | (721,813 | ) | ||||||
Payment of debt financing costs
|
(457 | ) | (52 | ) | — | |||||||
Proceeds from issuance of Class B preferred stock, net
|
— | — | 31,646 | |||||||||
Proceeds from issuance of convertible debt
|
— | — | 3,605 | |||||||||
Proceeds from issuance of Class C preferred stock, net
|
29,823 | 74,601 | — | |||||||||
Proceeds from exercise of stock options
|
— | 170 | — | |||||||||
Repurchase of common stock
|
— | (10,650 | ) | — | ||||||||
|
|
|
|
|
|
|||||||
Net cash (used in) provided by financing activities
|
(131,147 | ) | 122,503 | 88,764 | ||||||||
|
|
|
|
|
|
|||||||
Net change in cash, cash equivalents and restricted cash
|
20,859 | 12,550 | 8,050 | |||||||||
Cash, cash equivalents and restricted cash, beginning of year
|
29,883 | 17,333 | 9,283 | |||||||||
|
|
|
|
|
|
|||||||
Cash, cash equivalents and restricted cash, end of year
|
$ | 50,742 | $ | 29,883 | $ | 17,333 | ||||||
|
|
|
|
|
|
|||||||
Reconciliation of cash, cash equivalents and restricted cash to the consolidated balance sheet:
|
||||||||||||
Cash and cash equivalents
|
$ | 43,938 | $ | 22,856 | $ | 12,984 | ||||||
Restricted cash
|
6,804 | 7,027 | 4,349 | |||||||||
|
|
|
|
|
|
|||||||
Total cash, cash equivalents and restricted cash
|
$ | 50,742 | $ | 29,883 | $ | 17,333 | ||||||
|
|
|
|
|
|
|||||||
Supplemental disclosure of cash flow information:
|
||||||||||||
Cash payments for interest
|
$ | 14,048 | $ | 20,008 | $ | 21,448 | ||||||
|
|
|
|
|
|
|||||||
Non-cash
investing and financing activities
|
||||||||||||
Conversion of convertible debt to Class B preferred stock
|
$ | — | $ | — | $ | 18,199 | ||||||
|
|
|
|
|
|
|
Property and Equipment
|
Estimated Useful Life
|
||
Rooftop solar panel systems | Thirty years | |||
Properties held for use | Twenty seven and a half years | |||
Leasehold improvements | Lesser of estimated useful life or remaining lease term | |||
Computers and equipment | Five years | |||
Office equipment and furniture | Seven years | |||
Software systems | Four to five years |
December 31,
|
||||||||
2020
|
2019
|
|||||||
Homes under renovation
|
$ | 47,978 | $ | 36,118 | ||||
Homes listed for sale
|
30,826 | 178,000 | ||||||
Homes under contract to sell
|
92,555 | 129,490 | ||||||
|
|
|
|
|||||
Total inventory
|
$ | 171,359 | $ | 343,608 | ||||
|
|
|
|
December 31,
|
||||||||
2020
|
2019
|
|||||||
Rooftop solar panel systems
|
$ | 5,094 | $ | 5,094 | ||||
Properties held for use
|
2,790 | — | ||||||
Leasehold improvements
|
749 | 749 | ||||||
Computers and equipment
|
265 | 265 | ||||||
Office equipment and furniture
|
70 | 59 | ||||||
Software systems
|
318 | 262 | ||||||
|
|
|
|
|||||
9,286 | 6,429 | |||||||
Less accumulated depreciation
|
(1,055 | ) | (621 | ) | ||||
|
|
|
|
|||||
Total property and equipment, net
|
$ | 8,231 | $ | 5,808 | ||||
|
|
|
|
December 31,
|
||||||||
2020
|
2019
|
|||||||
Accrued compensation
|
$ | 6,180 | $ | 3,524 | ||||
Accrued other
|
3,052 | 3,892 | ||||||
Accrued interest
|
699 | 1,980 | ||||||
Accrued payroll tax
|
1,250 | 4 | ||||||
|
|
|
|
|||||
Total accrued liabilities
|
$ | 11,181 | $ | 9,400 | ||||
|
|
|
|
December 31,
|
||||||||
2020
|
2019
|
|||||||
Credit Facilities & Notes Payable, net
|
||||||||
Senior secured credit facility with a financial institution
|
$ | 49,544 | $ | 95,685 | ||||
Senior secured credit facility with a related party
|
105,397 | 211,607 | ||||||
Mezzanine secured credit facility with a related party
|
6,195 | 26,940 | ||||||
Mezzanine secured credit facility with a related party
|
13,056 | — | ||||||
Notes payable with related parties
|
2,385 | 2,537 | ||||||
Notes payable - other
|
5,309 | 5,630 | ||||||
Debt issuance costs
|
(208 | ) | (13 | ) | ||||
|
|
|
|
|||||
Total secured credit facilities & notes payable, net
|
181,678 | 342,386 | ||||||
Current Portion - Secured Credit Facilities & Notes Payable, net
|
||||||||
Total Secured Credit Facilities and Notes Payable, net - Related Party
|
126,825 | 241,071 | ||||||
Total Secured Credit Facilities and Notes Payable
|
50,143 | 101,315 |
As of December 31, 2020
|
Borrowing
Capacity |
Outstanding
Amount |
Weighted-
Average Interest Rate |
Maturity Date
|
||||||||||||
Senior secured credit facility with a financial institution
|
$ | 200,000 | $ | 49,544 | 3.72 | % | August 2022 | |||||||||
Senior secured credit facility with a related party
|
225,000 | 105,397 | 5.28 | % | December 2022 | |||||||||||
|
|
|
|
|||||||||||||
$ | 425,000 | $ | 154,941 | |||||||||||||
|
|
|
|
As of December 31, 2019
|
Borrowing
Capacity |
Outstanding
Amount |
Weighted-
Average Interest Rate |
|||||||||
Senior secured credit facility with a financial institution
|
$ | 100,000 | $ | 95,685 | 5.62 | % | ||||||
Senior secured credit facility with a related party
|
263,889 | 211,607 | 7.47 | % | ||||||||
|
|
|
|
|||||||||
$ | 363,889 | $ | 307,292 | |||||||||
|
|
|
|
As of December 31, 2020
|
Borrowing
Capacity |
Outstanding
Amount |
Weighted-
Average Interest Rate |
Maturity Date
|
||||||||||||
Mezzanine secured credit facility with a related party
|
$ | 25,000 | $ | 6,195 | 13.00 | % | February 2023 | |||||||||
Mezzanine secured credit facility with a related party
|
43,450 | 13,056 | 13.34 | % | December 2022 | |||||||||||
|
|
|
|
|||||||||||||
$ | 68,450 | $ | 19,251 | |||||||||||||
|
|
|
|
As of December 31, 2019
|
Borrowing
Capacity |
Outstanding
Amount |
Weighted-
Average Interest Rate |
|||||||||
Mezzanine secured credit facility with a related party
|
$ | 93,311 | $ | 26,940 | 14.00 | % | ||||||
|
|
|
|
Options
Issued Under Plan |
Nonemployee
Options |
Total
Options |
Weighted-
Average Exercise Price Per Share |
Weighted-Average
Remaining Contractual
Term (in years)
|
Aggregate
Intrinsic Value |
|||||||||||||||||||
Outstanding as of December 31, 2017
|
1,662,976 | 68,200 | 1,731,176 | $ | 4.84 | 9.05 | $ | 50,468 | ||||||||||||||||
Granted
|
2,644,330 | — | 2,644,330 | 1.48 | ||||||||||||||||||||
Forfeitures
|
(360,108 | ) | — | (360,108 | ) | 2.75 | ||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
Outstanding as of December 31, 2018
|
3,947,198 | 68,200 | 4,015,398 | 2.81 | 8.84 | 22,106,091 | ||||||||||||||||||
Granted
|
443,000 | 5,000 | 448,000 | 9.32 | ||||||||||||||||||||
Exercised
|
(76,445 | ) | — | (76,445 | ) | 2.22 | ||||||||||||||||||
Forfeitures
|
(1,244,818 | ) | — | (1,244,818 | ) | 1.85 | ||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
Outstanding as of December 31, 2019
|
3,068,935 | 73,200 | 3,142,135 | 4.14 | 7.71 | 16,274,640 | ||||||||||||||||||
Granted
|
570,000 | 128,000 | 698,000 | 9.19 | ||||||||||||||||||||
Exercised
|
— | — | — | — | ||||||||||||||||||||
Forfeitures
|
(177,398 | ) | — | (177,398 | ) | 4.06 | ||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
Outstanding as of December 31, 2020
|
3,461,537 | 201,200 | 3,662,737 | 5.09 | 7.40 | 14,619,403 | ||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
Exercisable as of December 31, 2020
|
1,468,468 | 3.43 | 6.75 | 8,006,815 | ||||||||||||||||||||
|
|
|||||||||||||||||||||||
Vested and expected to vest as of December 31, 2020
|
3,662,737 | 5.09 | 7.40 | 14,619,403 | ||||||||||||||||||||
|
|
2020
|
Year Ended December 31,
2019 |
2018
|
||||
Expected term (in years)
|
5.36 - 6.11
|
5.96 - 6.13
|
5.00 - 6.11
|
|||
Risk-free interest rate
|
0.38% - 0.46%
|
1.61% - 2.41%
|
2.65% - 3.11%
|
|||
Expected volatility
|
51.72% - 52.89%
|
42.43% - 43.50%
|
42.81% - 45.92%
|
|||
Dividend yield | 0.00% | 0.00% | 0.00% | |||
Fair value on grant date
|
$4.27 - $4.49
|
$3.96 - $4.21
|
$0.62 - $5.97
|
December 31,
|
||||||||
2020
|
2019
|
|||||||
Assets
|
||||||||
Restricted Cash
|
$ | 6,804 | $ | 7,027 | ||||
Accounts Receivable
|
1,638 | 2,554 | ||||||
Inventory
|
171,212 | 342,502 | ||||||
Prepaid expenses and other current assets
|
1,036 | 1,368 | ||||||
Property and equipment, net
|
2,772 | — | ||||||
|
|
|
|
|||||
Total Assets
|
183,462 | 353,451 | ||||||
|
|
|
|
|||||
Liabilities
|
||||||||
Accounts payable
|
716 | 1,253 | ||||||
Accrued liabilities
|
575 | 1,843 | ||||||
Secured credit facilities and notes payable, net - current portion
|
173,539 | 334,230 | ||||||
Secured credit facilities and notes payable - net of current portion
|
653 | — | ||||||
|
|
|
|
|||||
Total liabilities
|
$ | 175,483 | $ | 337,326 | ||||
|
|
|
|
Years Ended December 31,
|
||||||||||||
2020
|
2019
|
2018
|
||||||||||
Current provision federal
|
$ | — | $ | — | $ | — | ||||||
Current provision state
|
163 | 254 | 506 | |||||||||
|
|
|
|
|
|
|||||||
Total current
|
163 | 254 | 506 | |||||||||
Deferred provision federal
|
— | — | — | |||||||||
Deferred provision state
|
— | — | — | |||||||||
|
|
|
|
|
|
|||||||
Total deferred
|
— | — | — | |||||||||
|
|
|
|
|
|
|||||||
Total income tax expense
|
$ | 163 | $ | 254 | $ | 506 | ||||||
|
|
|
|
|
|
Years Ended December 31,
|
||||||||||||||||||||||||
2020
|
2019
|
2018
|
||||||||||||||||||||||
Provision at federal statutory tax rate
|
$ | (4,821 | ) | 21.0 | % | $ | (10,857 | ) | 21.0 | % | $ | (6,810 | ) | 21.0 | % | |||||||||
State income tax
|
(446 | ) | 1.9 | % | (2,003 | ) | 3.9 | % | (1,848 | ) | 5.7 | % | ||||||||||||
Valuation allowance
|
4,999 | -21.8 | % | 12,363 | -23.9 | % | 9,314 | -28.7 | % | |||||||||||||||
Other
|
431 |
-1.9
|
% | 751 | -1.5 | % | (150 | ) | 0.4 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Effective tax rate
|
$ | 163 | -0.7 | % | $ | 254 | -0.5 | % | $ | 506 | -1.6 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Years Ended December 31,
|
||||||||||||
2020
|
2019
|
2018
|
||||||||||
Deferred tax assets:
|
||||||||||||
Disallowed interest expense
|
$ | — | $ | 9,331 | $ | 5,012 | ||||||
Other
|
1,892 | 1,638 | 381 | |||||||||
Federal net operating loss carryforwards
|
27,847 | 15,564 | 10,010 | |||||||||
State net operating loss carryforwards
|
5,133 | 3,318 | 2,008 | |||||||||
|
|
|
|
|
|
|||||||
Gross deferred tax asset
|
34,872 | 29,851 | 17,411 | |||||||||
Valuation allowance
|
(34,011 | ) | (29,002 | ) | (16,639 | ) | ||||||
|
|
|
|
|
|
|||||||
DTA, net of valuation allowance
|
871 | 849 | 772 | |||||||||
|
|
|
|
|
|
|||||||
Deferred tax liabilities:
|
||||||||||||
Property and equipment
|
(865 | ) | (843 | ) | (772 | ) | ||||||
Other
|
(6 | ) | (6 | ) | — | |||||||
|
|
|
|
|
|
|||||||
Gross deferred tax liability
|
(871 | ) | (849 | ) | (772 | ) | ||||||
|
|
|
|
|
|
|||||||
Net deferred income taxes
|
$ | — | $ | — | $ | — | ||||||
|
|
|
|
|
|
Years ending December 31,
|
||||
2021
|
$ | 5,250 | ||
2022
|
1,697 | |||
2023
|
1,198 | |||
2024
|
1,127 | |||
2025
|
507 | |||
|
|
|||
$ | 9,779 | |||
|
|
June 30, 2021
|
December 31, 2020
|
|||||||
(unaudited)
|
||||||||
Assets:
|
||||||||
Current assets:
|
||||||||
Cash
|
$ | 283,067 | $ | 1,079,633 | ||||
Due from related party
|
7,713 | — | ||||||
Prepaid expenses
|
279,849 | 405,522 | ||||||
|
|
|
|
|||||
Total current assets
|
570,629 | 1,485,155 | ||||||
Investments held in Trust Account
|
402,685,072 | 402,578,522 | ||||||
|
|
|
|
|||||
Total Assets
|
$
|
403,255,701
|
|
$
|
404,063,677
|
|
||
|
|
|
|
|||||
Liabilities and Stockholders’ Equity:
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$ | 187,720 | $ | 38,915 | ||||
Accrued expenses
|
4,821,109 | 215,097 | ||||||
Due to related party
|
21,049 | — | ||||||
Income tax payable
|
6,764 | 4,749 | ||||||
Franchise tax payable
|
74,742 | 61,264 | ||||||
|
|
|
|
|||||
Total current liabilities
|
5,111,384 | 320,025 | ||||||
Deferred legal fees
|
100,000 | 100,000 | ||||||
Deferred underwriting commissions
|
14,087,500 | 14,087,500 | ||||||
Derivative liabilities
|
33,263,670 | 49,674,170 | ||||||
|
|
|
|
|||||
Total Liabilities
|
52,562,554 | 64,181,695 | ||||||
|
|
|
|
|||||
Commitments and Contingencies
|
||||||||
Class A common stock, $0.0001 par value; 34,569,314 and 33,488,198 shares subject to possible redemption at $10.00 per share as of June 30, 2021 and December 31, 2020, respectively
|
345,693,140 | 334,881,980 | ||||||
Stockholders’ Equity:
|
||||||||
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding
|
— | — | ||||||
Class A common stock, $0.0001 par value; 100,000,000 shares authorized; 5,680,686 and 6,761,802 shares issued and outstanding (excluding 34,569,314 and 33,488,198 shares subject to possible redemption) as of June 30, 2021 and December 31, 2020, respectively
|
568 | 676 | ||||||
Class B common stock, $0.0001 par value; 20,000,000 shares authorized; 10,062,500 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively
|
1,006 | 1,006 | ||||||
Additional
paid-in
capital
|
19,568,146 | 30,379,198 | ||||||
Accumulated deficit
|
(14,569,713 | ) | (25,380,878 | ) | ||||
|
|
|
|
|||||
Total Stockholders’ Equity
|
5,000,007 | 5,000,002 | ||||||
|
|
|
|
|||||
Total Liabilities and Stockholders’ Equity
|
$
|
403,255,701
|
|
$
|
404,063,677
|
|
||
|
|
|
|
For the Three
Months Ended
June 30, 2021
|
For the Six
Months Ended
June 30, 2021
|
|||||||
General and administrative expenses
|
$ | 2,312,921 | $ | 5,604,642 | ||||
Franchise tax expenses
|
49,863 | 99,228 | ||||||
|
|
|
|
|||||
Loss from operations
|
(2,362,784 | ) | (5,703,870 | ) | ||||
Other income
|
||||||||
Change in fair value of derivative liabilities
|
7,988,160 | 16,410,500 | ||||||
Income on investments held in Trust Account
|
10,410 | 106,550 | ||||||
|
|
|
|
|||||
Income before income tax expense
|
5,635,786 | 10,813,180 | ||||||
Income tax expense
|
(10,856 | ) | 2,015 | |||||
|
|
|
|
|||||
Net income
|
$
|
5,646,642
|
|
$
|
10,811,165
|
|
||
|
|
|
|
|||||
Weighted average shares outstanding of Class A common stock subject to possible redemption, basic and diluted
|
|
34,010,855
|
|
|
33,753,824
|
|
||
|
|
|
|
|||||
Basic and diluted net income per share, Class A common stock subject to possible redemption
|
$
|
—
|
|
$
|
0.00
|
|
||
|
|
|
|
|||||
Weighted average shares outstanding of
non-redeemable
Class A and Class B common stock, basic and diluted
|
|
16,301,645
|
|
|
16,558,676
|
|
||
|
|
|
|
|||||
Basic and diluted net income per share,
non-redeemable
Class A and Class B common stock
|
$
|
0.35
|
|
$
|
0.65
|
|
||
|
|
|
|
Common Stock
|
Additional
Paid-In
Capital
|
Accumulated
Deficit
|
Total
Stockholders’
Equity
|
|||||||||||||||||||||||||
Class A
|
Class B
|
|||||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
|||||||||||||||||||||||||
Balance—December 31, 2020
|
|
6,761,802
|
|
$
|
676
|
|
|
10,062,500
|
|
$
|
1,006
|
|
$
|
30,379,198
|
|
$
|
(25,380,878
|
)
|
$
|
5,000,002
|
|
|||||||
Common stock subject to possible redemption
|
(516,452 | ) | (51 | ) | — | — | (5,164,469 | ) | — | (5,164,520 | ) | |||||||||||||||||
Net income
|
— | — | — | — | — | 5,164,523 | 5,164,523 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Balance—March 31, 2021
|
|
6,245,350
|
|
$
|
625
|
|
|
10,062,500
|
|
$
|
1,006
|
|
$
|
25,214,729
|
|
$
|
(20,216,355
|
)
|
$
|
5,000,005
|
|
|||||||
Common stock subject to possible redemption
|
(564,664 | ) | (57 | ) | — | — | (5,646,583 | ) | — | (5,646,640 | ) | |||||||||||||||||
Net income
|
— | — | — | — | — | 5,646,642 | 5,646,642 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Balance—June 30, 2021
|
|
5,680,686
|
|
$
|
568
|
|
|
10,062,500
|
|
$
|
1,006
|
|
$
|
19,568,146
|
|
$
|
(14,569,713
|
)
|
$
|
5,000,007
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Operating Activities:
|
||||
Net income
|
$ | 10,811,165 | ||
Adjustments to reconcile net income to net cash used in operating activities:
|
||||
Change in fair value of derivative warrant liabilities
|
(16,410,500 | ) | ||
Income on from investments held in the Trust Account
|
(106,550 | ) | ||
Changes in operating assets and liabilities:
|
||||
Prepaid expenses
|
125,673 | |||
Due from related party
|
(7,713 | ) | ||
Accounts payable
|
148,805 | |||
Accrued expenses
|
4,606,012 | |||
Due to related party
|
21,049 | |||
Income tax payable
|
2,015 | |||
Franchise tax payable
|
13,478 | |||
|
|
|||
Net cash used in operating activities
|
(796,566 | ) | ||
|
|
|||
Net change in cash
|
(796,566 | ) | ||
Cash—beginning of the period
|
1,079,633 | |||
|
|
|||
Cash—end of the period
|
$
|
283,067
|
|
|
|
|
|||
Supplemental disclosure of noncash activities:
|
||||
Change in value of common stock subject to possible redemption
|
$ | (10,811,160 | ) |
• |
Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets;
|
• |
Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and
|
• |
Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
|
For the Three
Months
Ended
June 30, 2021
|
For the Six
Months
Ended
June 30, 2021
|
|||||||
Class A common stock subject to possible redemption
|
||||||||
Numerator: Earnings allocable to Class A common stock subject to possible redemption
|
||||||||
Income on investments held in Trust Account
|
$ | 8,941 | $ | 91,516 | ||||
Less: Company’s portion available to be withdrawn to pay taxes
|
$ | (8,941 | ) | $ | (86,958 | ) | ||
|
|
|
|
|||||
Net income attributable to Class A common stock subject to
possible redemption
|
$
|
—
|
|
$
|
4,558
|
|
||
|
|
|
|
|||||
Denominator: Weighted average Class A common stock subject to possible redemption
|
||||||||
Basic and diluted weighted average shares outstanding, Class A common stock subject to possible redemption
|
|
34,010,855
|
|
|
33,753,824
|
|
||
|
|
|
|
|||||
Basic and diluted net income per share, Class A common stock subject to possible redemption
|
$
|
—
|
|
$
|
0.00
|
|
||
|
|
|
|
|||||
Non-redeemable
common stock
|
||||||||
Numerator: Net income minus net earnings
|
||||||||
Net income
|
$ | 5,646,642 | $ | 10,811,165 | ||||
Net income allocable to Class A common stock subject to possible redemption
|
— | (4,558 | ) | |||||
|
|
|
|
|||||
Non-redeemable
net income
|
$
|
5,646,642
|
|
$
|
10,806,607
|
|
||
|
|
|
|
|||||
Denominator: Weighted average
non-redeemable
Class A and Class B common stock
|
||||||||
Basic and diluted weighted average shares outstanding,
non-redeemable
Class A and Class B common stock
|
|
16,301,645
|
|
|
16,558,676
|
|
||
|
|
|
|
|||||
Basic and diluted net income per share,
non-redeemable
Class A and Class B common stock
|
$
|
0.35
|
|
$
|
0.65
|
|
||
|
|
|
|
• |
in whole and not in part;
|
• |
at a price of $0.01 per Warrant;
|
• |
upon a minimum of 30 days’ prior written notice of redemption; and
|
• |
if, and only if, the last reported sale price of Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like and for certain issuances of Class A common stock and equity-linked securities as described above) for any 20 trading days within a
30-trading
day period ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant holders.
|
• |
in whole and not in part;
|
• |
at $0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption, provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by reference to an agreed table based on the redemption date and the “fair market value” of Class A common stock;
|
• |
if, and only if, the closing price of the Class A common stock equals or exceeds $10.00 per share (as adjusted per stock splits, stock dividends, reorganizations, recapitalizations and the like) on the trading day prior to the date on which the Company sends the notice of redemption to the warrant holders; and
|
• |
if and only if, the Private Placement Warrants are also concurrently called for redemption on the same terms as the outstanding Public Warrants, as described above.
|
Description
|
Quoted Prices
in
Active Markets
(Level 1)
|
Significant
Other
Observable
Inputs
(Level 2)
|
Significant
Other
Unobservable
Inputs
(Level 3)
|
|||||||||
Assets:
|
||||||||||||
Investments held in Trust Account
|
$ | 402,685,072 | $ | — | $ | — | ||||||
Liabilities:
|
||||||||||||
Derivative liabilities—Public Warrants
|
$ | 20,661,670 | $ | — | $ | — | ||||||
Derivative liabilities—Private Placement Warrants
|
$ | — | $ | — | $ | 10,452,000 | ||||||
Derivative liabilities—Forward Purchase Agreements
|
$ | — | $ | — | $ | 2,150,000 |
Description
|
Quoted Prices
in
Active Markets
(Level 1)
|
Significant
Other
Observable
Inputs
(Level 2)
|
Significant
Other
Unobservable
Inputs
(Level 3)
|
|||||||||
Assets:
|
||||||||||||
Investments held in Trust Account
|
$ | 402,578,522 | $ | — | $ | — | ||||||
Liabilities:
|
||||||||||||
Derivative liabilities—Public Warrants
|
$ | 27,504,170 | $ | — | $ | — | ||||||
Derivative liabilities—Private Placement Warrants
|
$ | 14,070,000 | ||||||||||
Derivative liabilities—Forward Purchase Agreements
|
$ | — | $ | — | $ | 8,100,000 |
As of
December 31,
2020
|
As of
March 31,
2021
|
As of
June 30,
2021
|
||||||||||
Volatility
|
21.75 | % | 24.25 | % | 22.13 | % | ||||||
Stock price
|
$ | 11.00 | $ | 10.11 | $ | 9.93 | ||||||
Expected life of the options to convert
|
5.647 | 5.297 | 5.047 | |||||||||
Risk-free rate
|
0.469 | % | 0.980 | % | 0.870 | % | ||||||
Dividend yield
|
0.00 | % | 0.00 | % | 0.00 | % |
As of
December 31,
2020
|
As of
March 31,
2021
|
As of
June 30,
2021
|
||||||||||
Risk-free rate
|
0.093 | % | 0.037 | % | 0.050 | % | ||||||
Term
|
0.647 | 0.297 | 0.047 |
Derivative liabilities at Level 3 at December 31, 2020
|
$ | 22,170,000 | ||
Change in fair value of Private Placement Warrants
|
(1,139,000 | ) | ||
Change in fair value of Forward Purchase Agreements
|
(4,600,000 | ) | ||
|
|
|||
Derivative liabilities at Level 3 at March 31, 2021
|
$ | 16,431,000 | ||
Change in fair value of Private Placement Warrants
|
(2,479,000 | ) | ||
Change in fair value of Forward Purchase Agreements
|
(1,350,000 | ) | ||
|
|
|||
Derivative liabilities at Level 3 at June 30, 2021
|
$ | 12,602,000 | ||
|
|
Assets:
|
||||
Current assets:
|
||||
Cash
|
$ | 1,079,633 | ||
Prepaid expenses
|
405,522 | |||
|
|
|||
Total current assets
|
1,485,155 | |||
Investments held in Trust Account
|
402,578,522 | |||
|
|
|||
Total Assets
|
$
|
404,063,677
|
|
|
|
|
|||
Liabilities and Stockholders’ Equity:
|
||||
Current liabilities:
|
||||
Accounts payable
|
$ | 38,915 | ||
Accrued expenses
|
215,097 | |||
Income tax payable
|
4,749 | |||
Franchise tax payable
|
61,264 | |||
|
|
|||
Total current liabilities
|
320,025 | |||
Deferred legal fees
|
100,000 | |||
Deferred underwriting commissions
|
14,087,500 | |||
Derivative liabilities
|
49,674,170 | |||
|
|
|||
Total Liabilities
|
64,181,695 | |||
|
|
|||
Commitments and Contingencies
|
||||
Class A common stock, $0.0001 par value; 33,488,198 shares subject to possible redemption at $10.00 per share
|
334,881,980 | |||
Stockholders’ Equity:
|
||||
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding
|
— | |||
Class A common stock, $0.0001 par value; 100,000,000 shares authorized; 6,761,802 shares issued and outstanding (excluding 33,488,198 shares subject to possible redemption)
|
676 | |||
Class B common stock, $0.0001 par value; 20,000,000 shares authorized; 10,062,500 shares issued and outstanding
|
1,006 | |||
Additional
paid-in
capital
|
30,379,198 | |||
Accumulated deficit
|
(25,380,878 | ) | ||
|
|
|||
Total stockholders’ equity
|
5,000,002 | |||
|
|
|||
Total Liabilities and Stockholders’ Equity
|
$
|
404,063,677
|
|
|
|
|
General and administrative expenses
|
$ | 229,377 | ||
Franchise tax expenses
|
61,264 | |||
|
|
|||
Total operating expenses
|
(290,641 | ) | ||
Other income (expense)
|
||||
Change in fair value of derivative liabilities
|
(24,193,170 | ) | ||
Financing costs - derivative liabilities
|
(970,840 | ) | ||
Net gain on investments held in Trust Account
|
78,522 | |||
|
|
|||
Loss before income tax expense
|
(25,376,129 | ) | ||
Income tax expense
|
4,749 | |||
|
|
|||
Net loss
|
$
|
(25,380,878
|
)
|
|
|
|
|||
Weighted average shares outstanding of Class A common stock subject to possible redemption, basic and diluted
|
|
35,891,064
|
|
|
|
|
|||
Basic and diluted net income per share, Class A common stock subject to possible redemption
|
$
|
0.00
|
|
|
|
|
|||
Weighted average shares outstanding of nonredeemable Class A and Class B common stock, basic and diluted
|
|
12,232,461
|
|
|
|
|
|||
Basic and diluted net loss per share, nonredeemable Class A and Class B common stock
|
$
|
(2.08
|
)
|
|
|
|
Common Stock
|
Additional
Paid-In
Capital
|
Accumulated
Deficit
|
Total
Stockholders’
Equity
|
|||||||||||||||||||||||||
Class A
|
Class B
|
|||||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
|||||||||||||||||||||||||
Balance - August 31, 2020 (inception)
|
|
—
|
|
$
|
—
|
|
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
|||||||
Issuance of Class B common stock to Sponsor
|
— | — | 10,062,500 | 1,006 | 23,994 | — | 25,000 | |||||||||||||||||||||
Sale of units in initial public offering, less fair value of public warrants
|
40,250,000 | 4,025 | — | — | 385,590,975 | — | 385,595,000 | |||||||||||||||||||||
Offering costs
|
— | — | — | — | (21,831,140 | ) | — | (21,831,140 | ) | |||||||||||||||||||
Excess of cash received over fair value of private placement warrants
|
— | — | — | — | 1,474,000 | — | 1,474,000 | |||||||||||||||||||||
Common stock subject to possible redemption
|
(33,488,198 | ) | (3,349 | ) | — | — | (334,878,631 | ) | — | (334,881,980 | ) | |||||||||||||||||
Net loss
|
— | — | — | — | — | (25,380,878 | ) | (25,380,878 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Balance - December 31, 2020
|
|
6,761,802
|
|
$
|
676
|
|
|
10,062,500
|
|
$
|
1,006
|
|
$
|
30,379,198
|
|
$
|
(25,380,878
|
)
|
$
|
5,000,002
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Operating Activities:
|
||||
Net loss
|
$ | (25,380,878 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||
General and administrative expenses paid by Sponsor under note payable
|
4,817 | |||
Change in fair value of derivative liabilities
|
24,193,170 | |||
Financing costs - derivative liabilities
|
970,840 | |||
Net gain from investments held in the Trust Account
|
(78,522 | ) | ||
Changes in operating assets and liabilities:
|
||||
Prepaid expenses
|
(405,522 | ) | ||
Accounts payable
|
31,490 | |||
Accrued expenses
|
106,922 | |||
Income tax payable
|
4,749 | |||
Franchise tax payable
|
61,264 | |||
|
|
|||
Net cash used in operating activities
|
(491,670 | ) | ||
|
|
|||
Cash Flows from Investing Activities
|
||||
Cash deposited in Trust Account
|
(402,500,000 | ) | ||
|
|
|||
Net cash used in investing activities
|
(402,500,000 | ) | ||
|
|
|||
Cash Flows from Financing Activities:
|
||||
Proceeds from note payable to related party
|
177,840 | |||
Repayment of note payable to related party
|
(182,657 | ) | ||
Proceeds received from initial public offering, gross
|
402,500,000 | |||
Proceeds received from private placement
|
10,050,000 | |||
Offering costs paid
|
(8,473,880 | ) | ||
|
|
|||
Net cash provided by financing activities
|
404,071,303 | |||
|
|
|||
Net increase in cash
|
1,079,633 | |||
Cash - beginning of the period
|
— | |||
|
|
|||
Cash - end of the period
|
$
|
1,079,633
|
|
|
|
|
|||
Supplemental disclosure of noncash activities:
|
||||
Offering costs paid by Sponsor in exchange for issuance of Class B common stock
|
$ | 25,000 | ||
Offering costs included in accrued expenses
|
$ | 108,175 | ||
Offering costs included in accounts payable
|
$ | 7,425 | ||
Deferred underwriting commissions in connection with the initial public offering
|
$ | 14,087,500 | ||
Deferred legal fees in connection with the initial public offering
|
$ | 100,000 | ||
Initial value of common stock subject to possible redemption
|
$ | 359,258,880 | ||
Change in value of common stock subject to possible redemption
|
$ | (24,376,900 | ) |
As of December 31, 2020
|
||||||||||||
As Previously
Reported |
Restatement
Adjustment |
As Restated
|
||||||||||
Balance Sheet
|
||||||||||||
Total assets
|
$ | 404,063,677 | $ | — | $ | 404,063,677 | ||||||
|
|
|
|
|
|
|||||||
Liabilities and stockholders’ equity
|
||||||||||||
Total current liabilities
|
$ | 320,025 | $ | — | $ | 320,025 | ||||||
Deferred legal fees
|
100,000 | — | 100,000 | |||||||||
Deferred underwriting commissions
|
14,087,500 | — | 14,087,500 | |||||||||
Derivative liabilities
|
— | 49,674,170 | 49,674,170 | |||||||||
|
|
|
|
|
|
|||||||
Total liabilities
|
14,507,525 | 49,674,170 | 64,181,695 | |||||||||
Class A common stock, $0.0001 par value; shares subject to possible redemption
|
384,556,150 | (49,674,170 | ) | 334,881,980 | ||||||||
Stockholders’ equity
|
||||||||||||
Preferred stock - $0.0001 par value
|
— | — | — | |||||||||
Class A common stock - $0.0001 par value
|
179 | 497 | 676 | |||||||||
Class B common stock - $0.0001 par value
|
1,006 | — | 1,006 | |||||||||
Additional
paid-in-capital
|
5,215,685 | 25,163,513 | 30,379,198 | |||||||||
Accumulated deficit
|
(216,868 | ) | (25,164,010 | ) | (25,380,878 | ) | ||||||
|
|
|
|
|
|
|||||||
Total stockholders’ equity
|
5,000,002 | — | 5,000,002 | |||||||||
Total liabilities and stockholders’ equity
|
$ | 404,063,677 | $ | — | $ | 404,063,677 | ||||||
|
|
|
|
|
|
Period From August 31, 2020 (Inception)
Through December 31, 2020
|
||||||||||||
As Previously
Reported |
Restatement
Adjustment |
As Restated
|
||||||||||
Statement of Operations
|
||||||||||||
Loss from operations
|
$ | (290,641 | ) | $ | — | $ | (290,641 | ) | ||||
Other (expense) income:
|
||||||||||||
Change in fair value of derivative liabilities
|
— | (24,193,170 | ) | (24,193,170 | ) | |||||||
Financing costs - derivative liabilities
|
— | (970,840 | ) | (970,840 | ) | |||||||
Net gain from investments held in Trust Account
|
78,522 | — | 78,522 | |||||||||
|
|
|
|
|
|
|||||||
Total other (expense) income
|
78,522 | (25,164,010 | ) | (25,085,488 | ) | |||||||
|
|
|
|
|
|
|||||||
Loss before income tax expense
|
(212,119 | ) | (25,164,010 | ) | (25,376,129 | ) | ||||||
Income tax expense
|
4,749 | — | 4,749 | |||||||||
Net loss
|
$ | (216,868 | ) | $ | (25,164,010 | ) | $ | (25,380,878 | ) | |||
|
|
|
|
|
|
|||||||
Basic and Diluted weighted-average Class A common shares subject to possible redemption outstanding
|
38,473,726 | (2,582,662 | ) | 35,891,064 | ||||||||
|
|
|
|
|
|
|||||||
Basic and Diluted net loss per Class A common shares subject to possible redemption
|
$ | — | $ | — | $ | — | ||||||
|
|
|
|
|
|
|||||||
Basic and Diluted weighted-average
non-redeemable
Class A and Class B common shares outstanding
|
10,646,616 | 1,585,845 | 12,232,461 | |||||||||
|
|
|
|
|
|
|||||||
Basic and Diluted net loss per
non-redeemable
Class A and Class B common shares
|
$ | (0.02 | ) | $ | 2.10 | $ | (2.08 | ) | ||||
|
|
|
|
|
|
Period From August 31, 2020 (Inception) Through
December 31, 2020
|
||||||||||||
As Previously
Reported
|
Restatement
Adjustment
|
As Restated
|
||||||||||
Statement of Cash Flows
|
||||||||||||
Net cash used in operating activities
|
(491,670 | ) | — | (491,670 | ) | |||||||
Net cash used in investing activities
|
(402,500,000 | ) | — | (402,500,000 | ) | |||||||
Net cash provided by financing activities
|
404,071,303 | 404,071,303 | ||||||||||
|
|
|
|
|
|
|||||||
Net change in cash
|
$ | 1,079,633 | $ | — | $ | 1,079,633 | ||||||
|
|
|
|
|
|
• |
Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets;
|
• |
Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and
|
• |
Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
|
For The Period From
August 31, 2020
(inception) through
December 31, 2020
(Restated)
|
||||
Class A Common stock subject to possible redemption
|
||||
Numerator: Earnings allocable to common stock subject to possible redemption
|
||||
Income from investments held in Trust Account
|
$ | 65,330 | ||
Less: Company’s portion available to be withdrawn to pay taxes
|
$ | (54,923 | ) | |
|
|
|||
Net income attributable to Class A common stock subject to possible redemption
|
$
|
10,407
|
|
|
|
|
|||
Denominator: Weighted average Class A common stock subject to possible redemption
|
||||
Basic and diluted weighted average shares outstanding
|
|
35,891,064
|
|
|
|
|
|||
Basic and diluted net income per share
|
$
|
0.00
|
|
|
|
|
|||
Non-Redeemable
Class A and Class B Common Stock
|
||||
Numerator: Net Loss minus Net Earnings
|
||||
Net loss
|
$ | (25,380,878 | ) | |
Net income allocable to Class A Common stock subject to possible redemption
|
10,407 | |||
|
|
|||
Non-Redeemable
Net Loss
|
$
|
(25,370,471
|
)
|
|
|
|
|||
Denominator: Weighted average
Non-redeemable
Class A and Class B common Stock
|
||||
Basic and diluted weighted average shares outstanding,
Non-redeemable
Class A and Class B common stock
|
|
12,232,461
|
|
|
|
|
|||
Basic and diluted net loss per share,
Non-redeemable
Class A and Class B common stock
|
$
|
(2.08
|
)
|
|
|
|
• |
in whole and not in part;
|
• |
at a price of $0.01 per Warrant;
|
• |
upon a minimum of 30 days’ prior written notice of redemption; and
|
• |
if, and only if, the last reported sale price of Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like and for certain issuances of Class A common stock and equity-linked securities as described above) for any 20 trading days
within a 30-trading day period
ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant holders.
|
• |
in whole and not in part;
|
• |
at $0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption, provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by reference to an agreed table based on the redemption date and the “fair market value” of Class A common stock;
|
• |
if, and only if, the closing price of the Class A common stock equals or exceeds $10.00 per share (as adjusted per stock splits, stock dividends, reorganizations, recapitalizations and the like) on the trading day prior to the date on which the Company sends the notice of redemption to the warrant holders; and
|
• |
if and only if, the Private Placement Warrants are also concurrently called for redemption on the same terms as the outstanding Public Warrants, as described above.
|
Description
|
Quoted
Prices in
Active Markets (Level 1) |
Significant
Other
Observable Inputs (Level 2) |
Significant
Other
Unobservable Inputs (Level 3) |
|||||||||
Assets:
|
||||||||||||
Investments held in Trust Account
|
$ | 402,578,522 | $ | — | $ | — | ||||||
Liabilities:
|
||||||||||||
Derivative liabilities warrant
|
$ | 27,504,170 | $ | — | $ | 14,070,000 | ||||||
Deriviative liabilities - Forward purchase agreements
|
$ | — | $ | — | $ | 8,100,000 |
As of
October 23,
2020 |
As of
December 31,
2020 |
|||||||
Volatility
|
21.00 | % | 21.75 | % | ||||
Stock price
|
$ | 10.00 | $ | 11.00 | ||||
Expected life of the options to convert
|
5.833 | 5.647 | ||||||
Risk-free rate
|
0.460 | % | 0.469 | % | ||||
Dividend yield
|
0.0 | % | 0.0 | % |
As of
October 23,
2020 |
As of
December 31,
2020 |
|||||||
Risk-free rate
|
0.117 | % | 0.93 | % | ||||
Term
|
0.833 | 0.647 |
Derivative liabilities at August 31, 2020 (inception)
|
$ | — | ||
Issuance of Public and Private Warrants and forward purchase agreements - Level 3
|
25,481,000 | |||
Transfer of Public Warrants to Level 1 measurement
|
(16,905,000 | ) | ||
Change in fair value of derivative liabilities - Level 3
|
13,594,000 | |||
|
|
|||
Derivative liabilities at Level 3, December 31, 2020
|
$ | 22,170,000 | ||
|
|
For the Period from
August 31, 2020
(inception) Through
December 31, 2020
|
||||
Current expense (benefit):
|
||||
Federal
|
$ | 3,325 | ||
State
|
1,424 | |||
|
|
|||
Total current expense (benefit):
|
$ | 4,749 | ||
Deferred expense (benefit):
|
||||
Federal
|
$ | — | ||
State
|
— | |||
|
|
|||
Total deferred expense (benefit):
|
$ | — | ||
|
|
|||
Total income tax expense (benefit):
|
$ | 4,749 | ||
|
|
For the Period from
August 31, 2020
(inception) Through
December 31, 2020
|
||||
Income at US statutory rate
|
21.00 | % | ||
State Taxes, net of federal benefit
|
0.05 | % | ||
Financing cost – derivative liabilities
|
(0.80 | )% | ||
|
|
|||
Change in fair value of derivative liabilities
|
(20.02 | )% | ||
Change in valuation allowance
|
(0.25 | )% | ||
|
|
|||
(0.02 | )% | |||
|
|
For the Period from
August 31, 2020
(inception) Through
December 31, 2020
|
||||
Capitalized
start-up
costs
|
$ | 63,119 | ||
|
|
|||
Total deferred tax assets
|
$ | 63,119 | ||
|
|
|||
Valuation allowance
|
$ | (63,119 | ) | |
|
|
|||
Net deferred tax assets (liability)
|
$ | — | ||
|
|
For the Period from
August 31, 2020
(inception) Through
December 31, 2020
|
||||
Valuation allowance at beginning of year
|
$ | — | ||
Increases recorded to income tax provision
|
$ | 63,119 | ||
|
|
|||
Valuation allowance at end of year
|
$ | (63,119 | ) | |
|
|
Item 13.
|
Other Expenses of Issuance and Distribution.
|
Amount
|
||||
Securities and Exchange Commission registration fee
|
$ | 305,346 | ||
Accounting fees and expenses
|
55,000 | |||
Legal fees and expenses
|
100,000 | |||
Financial printing and miscellaneous expenses
|
175,000 | |||
|
|
|||
Total expenses
|
$ | 635,346 | ||
|
|
Item 14.
|
Indemnification of Directors and Officers.
|
Item 15.
|
Recent Sales of Unregistered Securities.
|
Item 16.
|
Exhibits and Financial Statement Schedules.
|
(a)
|
Exhibits.
|
Exhibit
No. |
Description
|
|
10.25+ | Loan and Security Agreement, dated September 10, 2021, among JPMorgan Chase Bank, N.A., as Administrative Agent, the lenders party thereto, Offerpad SPE Borrower A, LLC, as initial borrower, and Wells Fargo Bank, National Association, as Paying Agent and Calculation Agent (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed September 15, 2021). | |
21.1 | List of subsidiaries | |
23.1 | Consent of Deloitte & Touche LLP | |
23.2 | Consent of Marcum LLP | |
23.3 | Consent of Latham & Watkins LLP (included in Exhibit 5.1). | |
24.1 | Power of Attorney (included on signature page to this registration statement). | |
101.INS | Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because iXBRL tags are embedded within the Inline XBRL document). | |
101.SCH | Inline XBRL Taxonomy Extension Schema Document | |
101.CAL | Inline XBRL Taxonomy Calculation Linkbase Document | |
101.DEF | Inline XBRL Taxonomy Definition Linkbase Document | |
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | |
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
104 | Cover Page Interactive Data File (formatted as Inline XBRL). |
+ |
Schedules and exhibits have been omitted pursuant to Item 601(a)(5) of Regulation
S-K.
The Registrant agrees to furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon request.
|
# |
Indicates a management contract or compensatory plan.
|
OFFERPAD SOLUTIONS INC.
|
||
By: |
/s/ Brian Bair
|
|
Name: | Brian Bair | |
Title: | Chairman and Chief Executive Officer |
Signature
|
Title
|
Date
|
||
/s/ Brian Bair
Brian Bair
|
Chief Executive Officer and
Chairman of the Board
(Principal Executive Officer)
|
September 24, 2021 | ||
/s/ Michael Burnett
Michael Burnett
|
Chief Financial Officer
(Principal Financial Officer and
Principal Accounting Officer)
|
September 24, 2021 | ||
/s/ Katie Curnutte
Katie Curnutte
|
Director | September 24, 2021 | ||
/s/ Kenneth DeGiorgio
Kenneth DeGiorgio
|
Director | September 24, 2021 | ||
/s/ Alexander Klabin
Alexander Klabin
|
Director | September 24, 2021 | ||
/s/ Ryan O’Hara
Ryan O’Hara
|
Director | September 24, 2021 | ||
/s/ Sheryl Palmer
Sheryl Palmer
|
Director | September 24, 2021 | ||
/s/ Roberto Sella
Roberto Sella
|
Director | September 24, 2021 |
Exhibit 5.1
Re: Offerpad Solutions Inc. Registration Statement on Form S-1
Ladies and Gentlemen:
We have acted as special counsel to Offerpad Solutions Inc., a Delaware corporation (the Company), in connection with its filing on the date hereof with the Securities and Exchange Commission (the Commission) of a registration statement on Form S-1 (the Registration Statement) under the Securities Act of 1933, as amended (the Act), relating to the registration of (i) the resale from time to time of (a) 233,993,391 shares (the Resale Shares) of Class A common stock, par value $0.0001 per share (the Class A common stock), of the Company, in each case, by the selling securityholders named in the Registration Statement and (b) 8,366,667 warrants (the Resale Warrants) to acquire shares of Class A common stock, in each case, by the selling securityholders named in the Registration Statement, (ii) the issuance by the Company of up to 3,274,959 shares of Class A common stock (the Equity Award Shares) upon the exercise of options to purchase shares of Class A common stock issuable under the OfferPad, Inc. 2016 Stock Option and Grant Plan (the Plan) and (iii) the issuance by the Company of up to 21,783,304 shares of Class A common stock (the Warrant Shares) upon the exercise of warrants to purchase shares of Class A common stock (the Warrants).
This opinion is being furnished in connection with the requirements of Item 601(b)(5) of Regulation S-K under the Act, and no opinion is expressed herein as to any matter pertaining to the contents of the Registration Statement or related prospectus or prospectus supplement (collectively, the Prospectus) other than as expressly stated herein with respect to the Resale Shares, the Resale Warrants, the Equity Award Shares and the Warrant Shares.
As such counsel, we have examined such matters of fact and questions of law as we have considered appropriate for purposes of this letter. With your consent, we have relied upon certificates and other assurances of officers of the Company and others as to factual matters without having independently verified such factual matters. We are opining herein as to the General Corporation Law of the State of Delaware (the DGCL) and, with respect to the opinions set forth in paragraph 3 below, the internal laws of the State of New York, and we express no opinion with respect to the applicability thereto, or the effect thereon, of the laws of any other jurisdiction or, in the case of Delaware, any other laws, or as to any matters of municipal law or the laws of any local agencies within any state.
September 24, 2021
Page 2
Subject to the foregoing and the other matters set forth herein, it is our opinion that, as of the date hereof:
1. |
The Resale Shares have been duly authorized by all necessary corporate action of the Company and are validly issued, fully paid and nonassessable. |
2. |
When the Equity Award Shares have been duly registered on the books of the transfer agent and registrar therefor in the name or on behalf of the recipients thereof, and have been issued by the Company in the circumstances contemplated by and pursuant to the Plan and assuming in each case that the individual issuances, grants or awards under the Plan are duly authorized by all necessary corporate action and duly issued, granted or awarded and exercised in accordance with the requirements of applicable law and the Plan (and the agreements and awards duly adopted thereunder and in accordance therewith), the issue and sale of the Equity Award Shares will have been duly authorized by all necessary corporate action of the Company and will be validly issued, fully paid and nonassessable. In rendering the foregoing opinion, we have assumed that the Company will comply with all applicable notice requirements regarding uncertificated shares provided in the DGCL. |
3. |
The Resale Warrants are the legally valid and binding obligations of the Company, enforceable against the Company in accordance with their terms. |
4. |
When the Warrant Shares shall have been duly registered on the books of the transfer agent and registrar therefor in the name of or on behalf of the Warrant holders and have been issued by the Company against payment therefor (not less than par value) in the circumstances contemplated by the Warrants, the Warrant Shares will have been duly authorized by all necessary corporate action of the Company and will be validly issued, fully paid and nonassessable. In rendering the foregoing opinion, we have assumed that the Company will comply with all applicable notice requirements regarding uncertificated shares provided in the DGCL. |
Our opinion set forth in numbered paragraph 3 is subject to: (i) the effect of bankruptcy, insolvency, reorganization, preference, fraudulent transfer, moratorium or other similar laws relating to or affecting the rights and remedies of creditors; (ii) the effect of general principles of equity, whether considered in a proceeding in equity or at law (including the possible unavailability of specific performance or injunctive relief), concepts of materiality, reasonableness, good faith and fair dealing, and the discretion of the court before which a proceeding is brought; (iii) the invalidity under certain circumstances under law or court decisions of provisions providing for the indemnification of or contribution to a party with respect to a liability where such indemnification or contribution is contrary to public policy; and (iv) we express no opinion as to (a) any provision for liquidated damages, default interest, late charges, monetary penalties, make-whole premiums
September 24, 2021
Page 3
or other economic remedies to the extent such provisions are deemed to constitute a penalty, (b) consents to, or restrictions upon, governing law, jurisdiction, venue, arbitration, remedies, or judicial relief, (c) waivers of rights or defenses, (d) any provision requiring the payment of attorneys fees, where such payment is contrary to law or public policy, (e) the creation, validity, attachment, perfection, or priority of any lien or security interest, (f) advance waivers of claims, defenses, rights granted by law, or notice, opportunity for hearing, evidentiary requirements, statutes of limitation, trial by jury or at law, or other procedural rights, (g) waivers of broadly or vaguely stated rights, (h) provisions for exclusivity, election or cumulation of rights or remedies, (i) provisions authorizing or validating conclusive or discretionary determinations, (j) grants of setoff rights, (k) proxies, powers and trusts, (l) provisions prohibiting, restricting, or requiring consent to assignment or transfer of any right or property, and (m) the severability, if invalid, of provisions to the foregoing effect.
With your consent, we have assumed (a) that the Warrants and the warrant agreement, dated October 20, 2020, between the Company and Continental Stock Transfer & Trust Company, as warrant agent, relating to the Warrants, have been duly authorized, executed and delivered by the parties thereto other than the Company, (b) that the Warrants and the warrant agreement constitute or will constitute legally valid and binding obligations of the parties thereto other than the Company, enforceable against each of them in accordance with their respective terms and (c) that the status of the Warrants as legally valid and binding obligations of the parties will not be affected by any (i) breaches of, or defaults under, agreements or instruments, (ii) violations of statutes, rules, regulations or court or governmental orders or (iii) failures to obtain required consents, approvals or authorizations from, or to make required registrations, declarations or filings with, governmental authorities.
This opinion is for your benefit in connection with the Registration Statement and may be relied upon by you and by persons entitled to rely upon it pursuant to the applicable provisions of the Act. We consent to your filing this opinion as an exhibit to the Registration Statement and to the reference to our firm contained in the Prospectus under the heading Legal Matters. In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Commission thereunder.
Very truly yours,
/s/ Latham & Watkins LLP
Exhibit 21.1
Subsidiaries of Offerpad Solutions Inc.
Name |
Jurisdiction of Incorporation |
|
Offerpad Holdings LLC |
Delaware | |
OfferPad, LLC |
Arizona | |
Elevation Solar Leasing, LLC |
Arizona | |
Bair Group Acquire, LLC |
Arizona | |
OfferPad (SPVBorrower), LLC |
Delaware | |
OfferPad (SPVBorrower1), LLC |
Delaware | |
OP SPE PHX1, LLC |
Delaware | |
OP SPE TPA1, LLC |
Delaware | |
OP SPE BORROWER PARENT, LLC |
Delaware | |
OP SPE HOLDCO, LLC |
Delaware | |
OfferPad Mortgage, LLC |
Arizona | |
OfferPad Brokerage, LLC |
Arizona | |
OfferPad Brokerage FL, LLC |
Florida | |
OP Contracting AZ, LLC |
Arizona | |
OP Contracting GA, LLC |
Georgia | |
OP Contracting TX, LLC |
Texas | |
OfferPad Brokerage CA, Inc. |
California | |
Offerpad SPV Borrower G, LLC |
Delaware | |
Offerpad SPE Borrower A Holdings, LLC |
Delaware | |
Offerpad SPE Borrower A, LLC |
Delaware |
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the use in this Registration Statement on Form S-1 of our report dated April 7, 2021, relating to the financial statements of Offerpad, Inc. We also consent to the reference to us under the heading Experts in such Registration Statement.
DELOITTE & TOUCHE LLP
Phoenix, Arizona
September 24, 2021
Exhibit 23.2
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMS CONSENT
We consent to the inclusion in this Registration Statement of Offerpad Solutions Inc. (formerly Supernova Partners Acquisition Company Inc.) on Form S-1 of our report dated March 31, 2021, except for the effects of the restatement discussed in Notes 2 and 11 as to which the date is May 25, 2021, with respect to our audits of the financial statements of Supernova Partners Acquisition Corp. as of December 31, 2020 and for the period from August 31, 2020 (inception) through December 31, 2020, which report appears in the Prospectus, which is part of this Registration Statement. We were dismissed as auditors on September 1, 2021 and, accordingly, we have not performed any audit or review procedures with respect to any financial statements appearing in such Prospectus for the periods after the date of our dismissal. We also consent to the reference to our Firm under the heading Experts in such Prospectus.
/s/ Marcum LLP
Marcum LLP
New York, NY
September 24, 2021