10-Q 1 brhc10027662_10q.htm 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2021

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File No. 001-39140

CHP MERGER CORP.

(Exact name of registrant as specified in its charter)

Delaware		84-290924
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

25 Deforest Avenue, Suite 108

Summit, New Jersey 07901

(Address of Principal Executive Offices, including zip code)

(212) 508-7090

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Units, each consisting of one share of Class A common stock, $0.0001 par value, and one-half of one redeemable warrant	CHPMU	The Nasdaq Stock Market LLC
Redeemable common stock included as part of the units	CHPM	The Nasdaq Stock Market LLC
Warrants included as part of the units, each whole warrant exercisable for one share of Class A common stock at an exercise price of $11.50	CHPMW	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

☐	Large accelerated filer	☐	Accelerated filer
☒	Non-accelerated filer	☒	Smaller reporting company
		☒	Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes ☒ No ☐

As of August 9, 2021, 30,000,000 shares of Class A common stock, $0.0001 par value, and 7,500,000 shares of Class B common stock, $0.0001 par value, were issued and outstanding.

CHP MERGER CORP.

Quarterly Report on Form 10-Q

TABLE OF CONTENTS

		Page

PART 1 – FINANCIAL INFORMATION

Item 1.	Condensed Financial Statements	1

	Condensed Balance Sheets as of March 31, 2021 (unaudited) and December 31, 2020	1

	Condensed Statements of Operations for the three months ended March 31, 2021 and 2020 (unadited)	2

	Condensed Statements of Changes in Stockholders’ Equity for the three months ended March 31, 2021 and 2020 (unaudited)	3

	Condensed Statements of Cash Flows for the three months ended March 31, 2021 and 2020 (unaudited)	4

	Notes to Condensed Financial Statements (unaudited)	5

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	20

Item 4.	Control and Procedures	20

PART II – OTHER INFORMATION

Item 1.	Legal Proceedings	20

Item 1A.	Risk Factors	20

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	21

Item 3.	Defaults Upon Senior Securities	21

Item 4.	Mine Safety Disclosures	21

Item 5.	Other Information	21

Item 6.	Exhibits	22

SIGNATURES		23

	March 31, 2021			December 31, 2020
	(unaudited)
ASSETS
Current assets
Cash	$	239,850		$	604,245
Prepaid expenses		117,933			—
Total Current Assets		357,783			604,245

Cash and marketable securities held in Trust Account		302,364,150			302,329,495
TOTAL ASSETS	$	302,721,933		$	302,933,740

LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities
Current liabilities
Accounts payable and accrued expenses	$	294,605		$	250,090
Income taxes payable		85,088			85,088
Total Current Liabilities		379,693			335,178

Warrant liability		18,400,000			36,700,000
Deferred underwriting fee payable		10,500,000			10,500,000
TOTAL LIABILITIES		29,279,693			47,535,178

Commitments and Contingencies

Class A common stock subject to possible redemption, 26,844,224 and 25,039,856 shares as of March 31, 2021 and December 31, 2020, respectively (at $10.00 per share)		268,442,238			250,398,560

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; 200,000,000 shares authorized; 3,155,776 and 4,960,144 shares issued and outstanding (excluding 26,844,224 and 25,039,856 shares subject to possible redemption) as of March 31, 2021 and December 31, 2020, respectively		316			496
Class B common stock, $0.0001 par value; 20,000,000 shares authorized; 7,500,000 shares issued and outstanding		750			750
Additional paid-in capital		6,426,337			24,469,835
Accumulated Deficit		(1,427,401	)		(19,471,079	)
Total Stockholders’ Equity		5,000,002			5,000,002
Total Liabilities and Stockholders’ Equity	$	302,721,933		$	302,933,740

	Three Months Ended March 31, 2021			Three Months Ended March 31, 2020
General and administrative expenses	$	290,977		$	165,097
Loss from operations		(290,977	)		(165,097	)

Other income (expense):
Change in fair value of warrant liabilities		18,300,000			(1,150,000	)
Interest earned on marketable securities held in trust account		34,655			1,147,527

Income (loss) before provision for income taxes		18,043,678			(167,570	)
Provision for income taxes		—			(230,481	)
Net income (loss)	$	18,043,678		$	(398,051	)

Weighted average shares outstanding of Class A redeemable common stock		30,000,000			30,000,000
Basic and diluted net income per share, Class A redeemable common stock	$	0.00		$	0.03

Weighted average shares outstanding of Class B non-redeemable common stock		7,500,000			7,500,000
Basic and diluted net income (loss) per share, Class B non-redeemable common stock	$	2.41		$	(0.17	)

	Class A Common Stock						Class B Common Stock				Additional Paid-in			Accumulated			Total Stockholders’
	Shares			Amount			Shares		Amount		Capital			Deficit			Equity
Balance – January 1, 2021		4,960,144		$	496			7,500,000	$	750	$	24,469,835		$	(19,471,079	)	$	5,000,002

Change in value of Class A common stock subject to possible redemption		(1,804,368	)		(180	)		—		—		(18,043,498	)		—			(18,043,678	)

Net income		—			—			—		—		—			18,043,678			18,043,678

Balance – March 31, 2021 (unaudited)		3,155,776		$	316			7,500,000	$	750	$	6,426,337		$	(1,427,401	)	$	5,000,002

	Three Months Ended March 31, 2021			Three Months Ended March 31, 2020
Cash Flows from Operating Activities:
Net income (loss)	$	18,043,678		$	(398,051	)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Change in fair value of warrant liabilities		(18,300,000	)		1,150,000
Interest earned on marketable securities held in trust account		(34,655	)		(1,147,527	)
Changes in operating assets and liabilities:
Prepaid expenses and other current assets		(117,933	)		(12,474	)
Accounts payable and accrued expenses		44,515			35,552
Income taxes payable		—			230,481
Net cash used in operating activities		(364,395	)		(142,019	)

Cash Flows from Investing Activities:
Cash withdrawn from trust account for payment of franchise taxes		—			84,434
Net cash provided by investing activities		—			84,434

Net Change in Cash		(364,395	)		(57,585	)
Cash – Beginning of period		604,245			1,301,607
Cash – End of period	$	239,850		$	1,244,022

Non-Cash financing activities:
Change in value of Class A common stock subject to possible redemption	$	18,043,678		$	(398,050	)

	Three Months Ended March 31, 2021			Three Months Ended March 31, 2020
Redeemable Class A Common Stock
Numerator: Earnings allocable to Redeemable Class A Common Stock
Interest Income	$	34,655		$	1,147,527
Income and Franchise Tax		(34,655	)		(280,481	)
Redeemable Net Earnings	$	—		$	867,046
Denominator: Weighted Average Redeemable Class A Common Stock
Redeemable Class A Common Stock, Basic and Diluted		30,000,000			30,000,000
Earnings/Basic and Diluted Redeemable Class A Common Stock	$	0.00		$	0.03

Non-Redeemable Class B Common Stock
Numerator: Net Income (Loss) minus Redeemable Net Earnings
Net Income (Loss)	$	18,043,678		$	(398,051	)
Redeemable Net Earnings		—			(867,046	)
Non-Redeemable Net Earnings (Loss)	$	18,043,678		$	(1,265,097	)
Denominator: Weighted Average Non-Redeemable Class B Common Stock
Non-Redeemable Class B Common Stock, Basic and Diluted		7,500,000			7,500,000
Income (Loss)/Basic and Diluted Non-Redeemable Class B Common Stock	$	2.41		$	(0.17	)

	Held-To-Maturity	Amortized Cost		Gross Holding Gain (Loss)			Fair Value
March 31, 2021	U.S. Treasury Securities (Matures on June 10, 2021)	$	301,363,168	$	9,040		$	301,372,209

December 31, 2020	U.S. Treasury Securities (Matures on February 18, 2021)	$	301,328,657	$	(2,966	)	$	301,325,691

Description	Level		March 31, 2021		December 31, 2020
Liabilities:
Warrant Liability – Public Warrants		1		12,000,000		19,500,000
Warrant Liability – Private Placement Warrants		3		6,400,000		17,200,000

	March 31, 2021			December 31, 2020
Exercise price	$	11.50		$	11.50
Stock price	$	9.91		$	10.26
Volatility		16.1	%		26.6	%
Term		5.00			5.00
Risk-free rate		0.64	%		0.42	%
Dividend yield		0.0	%		0.0	%

	Private Placement
Fair value as of January 1, 2021		17,200,000
Change in fair value		(10,800,000	)
Fair value as of March 31, 2021	$	6,400,000

	Private Placement		Public			Warrant Liabilities
Fair value as of January 1, 2020		3,920,000		7,350,000			11,270,000
Transfer to Level 1		—		(7,350,000	)		(7,350,000	)
Change in valuation inputs or other assumptions		400,000		—			400,000
Fair value as of March 31, 2020	$	4,320,000	$	—		$	4,320,000

No.		Description of Exhibit
31.1*		Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*		Certification of Principal Financial Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1**		Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2**		Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS*		XBRL Instance Document
101.CAL*		XBRL Taxonomy Extension Calculation Linkbase Document
101.SCH*		XBRL Taxonomy Extension Schema Document
101.DEF*		XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*		XBRL Taxonomy Extension Labels Linkbase Document
101.PRE*		XBRL Taxonomy Extension Presentation Linkbase Document

	CHP MERGER CORP.

Date: August 9, 2021		/s/ James T. Olsen
	Name:	James T. Olsen
	Title:	Chief Executive Officer and Director
		(Principal Executive Officer)

Date: August 9, 2021		/s/ Benson Jose
	Name:	Benson Jose
	Title:	Chief Financial Officer
		(Principal Financial and Accounting Officer)

SEC Form 10-Q filed by CHP Merger Corp.