☒ | Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
2021
(State or Other Jurisdiction of Incorporation) | (I.R.S. Employer Identification No.) | |
660 Steamboat Rd. Greenwich, CT | 06830 | |
(Address of principal executive offices) | (zip code) |
Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☒ Smaller reporting company ☒ Emerging growth company ☒
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execute such agreements that they would be prevented from bringing claims against the trust account including but not limited to fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain an advantage with respect to a claim against our assets, including the funds held in the trust account. If any third party refuses to execute an agreement waiving such claims to the monies held in the trust account, our management will perform an analysis of the alternatives available to it and will only enter into an agreement with a third party that has not executed a waiver if management believes that such third party’s engagement would be significantly more beneficial to us than any alternative. Examples of possible instances where we may engage a third party that refuses to execute a waiver include the engagement of a third party consultant whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a waiver. The underwriter will not execute agreements with us waiving such claims to the monies held in the trust account. In addition, there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with us and will not seek recourse against the trust account for any reason. In order to protect the amounts held in the trust account, our sponsor has agreed that it will be liable to us if and to the extent any claims by a vendor for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amounts in the trust account to below the lesser of (i) $10.00 per public share and (ii) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account if less than $10.00 per public share due to reductions in the value of the trust assets, in each case net of the interest that may be withdrawn to pay our tax obligations, provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to seek access to the trust account nor will it apply to any claims under our indemnity of the underwriter of our offering against certain liabilities, including liabilities under the Securities Act. In the event that an executed waiver is deemed to be unenforceable against a third party, our sponsor will not be responsible to the extent of any liability for such third party claims. However, we have not asked our sponsor to reserve for such indemnification obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and we believe that our sponsor’s only assets are securities of our company. Our sponsor may not be able to satisfy those obligations. None of our officers or directors will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses.
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restated memorandum and articles of association provide, among other things, that prior to the completion of our initial business combination, we may not issue additional shares that would entitle the holders thereof to (i) receive funds from the trust account or (ii) vote on any initial business combination or on any other proposal presented to shareholders prior to or in connection with the completion of an initial business combination. These provisions of our amended and restated memorandum and articles of association, like all provisions of our amended and restated memorandum and articles of association, may be amended with a shareholder vote. The issuance of additional ordinary or preference shares:
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portion of the funds available to us to pay fees to consultants to assist us with our search for a target business. We could also use a portion of the funds as a down payment or to fund a “no-shop”
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required to provide for payment of claims of creditors that were not waived that may be brought against us within the 10 years following redemption. Accordingly, the
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If, before distributing the proceeds in the trust account to our public shareholders, we file a bankruptcy or insolvency petition or an involuntary bankruptcy or insolvency petition is filed against us that is not dismissed, the proceeds held in the trust account could be subject to applicable bankruptcy or insolvency law, and may be included in our bankruptcy or insolvency estate and subject to the claims of third parties with priority over the claims of our shareholders. To the extent any bankruptcy or insolvency claims deplete the trust account, the
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for services they would render to us after the completion of the business combination. Such negotiations also could make such key personnel’s retention or resignation a condition to any such agreement. The personal and financial interests of such individuals may influence their motivation in identifying and selecting a target business. In addition, pursuant to an agreement entered into at the closing of our offering, our sponsor, upon and following consummation of an initial business combination, is entitled to nominate three individuals for appointment to our board of directors, as long as the sponsor holds any securities covered by the registration and shareholder rights agreement, which is described under the section titled “Description of Securities — Registration and Shareholder Rights” contained in our prospectus, incorporated by reference herein.
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We may effectuate our initial business combination with a single target business or multiple target businesses simultaneously or within a short period of time. However, we may not be able to effectuate our initial business combination with more than one target business because of various factors, including the existence of complex accounting issues and the requirement that we prepare and file pro forma financial statements with the SEC that present operating results and the financial condition of several target businesses as if they had been operated on a combined basis. By completing our initial business combination with only a single entity, our lack of diversification may subject us to numerous economic, competitive and regulatory developments. Further, we would not be able to diversify our operations or benefit from the possible spreading of risks or offsetting of losses, unlike other entities which may have the resources to complete several business combinations in different industries or different areas of a single industry. Accordingly, the prospects for our success may be:
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Even if we conduct due diligence on a target business with which we combine, this diligence may not surface all material issues with a particular target business. In addition, factors outside of the target business and outside of our control may later arise. As a result of these factors, we may be forced to later write-down or
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of corporate law. In addition, Cayman Islands companies may not have standing to initiate a shareholders derivative action in a Federal court of the United States. For a more detailed discussion of the principal differences between the provisions of the Companies Law applicable to us and, for example, the laws applicable to companies incorporated in the United States and their shareholders, see the section titled “Description of Securities — Certain Differences in Corporate Law” contained in our prospectus, incorporated by reference herein.
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business combination with such a company, we would be subject to other special considerations or risks associated with companies operating in an international setting. We may not be able to adequately address these additional risks. If we were unable to do so, we may be unable to complete such initial business combination, or, if we complete such combination, our operations might suffer, either of which may adversely impact our business, financial condition and results of operations.
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national securities exchange such that they satisfy the definition of a “covered security” under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, but we will use our reasonable best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. In no event will we be required to net cash settle any warrant, or issue securities or other compensation in exchange for the warrants in the event that we are unable to register or qualify the shares underlying the warrants under the Securities Act or applicable state securities laws. If the issuance of the shares upon exercise of the warrants is not so registered or qualified or exempt from registration or qualification, the holder of such warrant will not be entitled to exercise such warrant and such warrant may have no value and expire worthless. In such event, holders who acquired their warrants as part of a purchase of units will have paid the full unit purchase price solely for the Class A ordinary shares included in the units. There may be a circumstance where an exemption from registration exists for holders of our Private Placement Warrants to exercise their warrants while a corresponding exemption does not exist for holders of the warrants included as part of units sold in our offering. In such an instance, our sponsor and its transferees (which may include our management team) would be able to exercise their warrants and sell the ordinary shares underlying their warrants while holders of our public warrants would not be able to exercise their warrants and sell the underlying ordinary shares. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws.
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ordinary shares in connection with a shareholder vote described in clause (ii) in the preceding sentence shall not be entitled to funds from the trust account upon the subsequent completion of an initial business combination or liquidation if we have not consummated an initial business combination by October 23, 2022, with respect to such Class A ordinary shares so redeemed. In no other circumstances will a shareholder have any right or interest of any kind to or in the trust account. Holders of warrants will not have any right to the proceeds held in the trust account with respect to the warrants. Accordingly, to liquidate your investment, you may be forced to sell your public shares or warrants, potentially at a loss.
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expectations as to the number of shares that will be submitted for redemption. If a large number of shares are submitted for redemption, we may need to restructure the transaction to reserve a greater portion of the cash in the trust account or arrange for additional third party financing. Raising additional third party financing may involve dilutive equity issuances or the incurrence of indebtedness at higher than desirable levels. The above considerations may limit our ability to complete the most desirable business combination available to us or optimize our capital structure. The amount of the deferred underwriting commissions payable to the underwriter will not be adjusted for any shares that are redeemed in connection with an initial business combination. The
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Not applicable.
Through December 31, 2020,2021, the Company’s liquidity needs were satisfied through receipt of $25,000 from the sale of the founder shares advances from the sponsor in an aggregate amount of $61,810 and the remaining net proceeds from the initial public offering and the sale of private placement units.
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not effective, due to the material weakness in our internal control over financial reporting related to the Company’s accounting for complex financial instruments. As a result, we performed additional analysis as deemed necessary to ensure that our financial statements were prepared in accordance with U.S. generally accepted accounting principles. Accordingly, management believes that the financial statements included in this Form 10-K present fairly in all material respects our financial position, results of operations and cash flows for the period presented.
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Changes inThere was no change
(1) | pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of our company, |
(2) | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors, and |
(3) | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements. |
Name | Age | |||
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Chairman and Chief Executive Officer | ||||||||
Mark DiPaolo | 51 | |||||||
Senior Managing Director | ||||||||
57 | President | |||||||
Odysseas Kostas | 47 | Senior Managing Director | ||||||
39 | ||||||||
Chief Financial Officer | ||||||||
Louis Paglia | ||||||||
Director | ||||||||
57 | Director | |||||||
Keith Horn | 64 | Director |
Alexander Denner, Ph.D.,
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from 2012 through 2017, as Chief Executive Officer of The Electrum Group. From 2004 through 2011, Mr. Vincent served as President of Ospraie Management and was integral in developing the long-term strategy for the firm and its growth from $1 billion to over $9 billion under management. From 2007 through October 2009, Mr. Vincent also served as Chairman of the Board of Directors of the Managed Funds Association, the principal trade association representing the U.S. hedge fund industry. Previously, he was a partner at Omega Advisors, Inc. He began his career as an attorney at Cravath, Swaine & Moore LLP. Mr. Vincent received his B.A. degree from Williams College and his J.D. degree from Harvard Law School.
Simos Simeonidishas served as a Senior Managing Director of the Company since October 20, 2020. Since January 2017 to the present date, Dr. Simeonidis has served as a Partner and Senior Managing Director of Sarissa. Prior to joining Sarissa, he was a Managing Director and Senior Biotechnology Analyst at the Royal Bank of Canada (RBC) in New York, where he was employed from 2014 to 2017. Since June 2019 to the present date, Dr. Simeonidis has also served on the Board of Directors of Regulus Therapeutics, Inc. Dr. Simeonidis spent more than a decade covering the biotechnology sector as an analyst at a number of investment banks, including Cowen and Company, First Albany Capital and Morgan Stanley. In addition to his investment management and financial expertise, Dr. Simeonidis combines both biopharmaceutical industry and biomedical research expertise, having worked at Novartis in Business Development and Strategic Planning, and prior to his corporate career, having served as a faculty member at Harvard Medical School. Dr. Simeonidis received his B.S. degree in Biology from Loyola University Chicago, and his M.A., MPhil and PhD degrees in Cellular, Molecular and Biophysical Sciences from Columbia University’s College of Physicians & Surgeons. He completed his Postdoctoral Fellowship at the laboratory of Professor Tucker Collins at Harvard Medical School and the Brigham and Women’s Hospital, where he worked on the transcriptional regulation of gene expression. Dr. Simeonidis also holds an MBA in Healthcare Management at the Wharton School of the University of Pennsylvania.
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Mr. Timney is CEO and Board member of Attralus Inc, a biotechnology company focused on the treatment of systemic amyloidosis, since March 2021.
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Name and Address of Beneficial Owner (1) | Amount and Nature of Beneficial Ownership | Approximate Percentage of Outstanding Shares | ||||||
Sarissa Capital Acquisition Sponsor LLC (our sponsor) (2) | 5,000,000 | 20 | % | |||||
Alexander Denner | — | |||||||
Mark DiPaolo | — | |||||||
Eric Vincent | — | |||||||
Odysseas Kostas | — | |||||||
Simos Simeonidis | — | |||||||
Patrice Bonfiglio | — | |||||||
Louis Paglia | 6,000 | * | ||||||
Mark Timney | — | |||||||
All directors and executive officers as a group (eight individuals) | 5,000,000 | 20 | % | |||||
Five Percent Holders: | ||||||||
Castle Creek Arbitrage, LLC (3) | 1,106,580 | 5.53 | % | |||||
683 Capital Management, LLC (4) | 1,200,000 | 6.0 | % | |||||
Putnam Investments, LLC d/b/a/ Putnam Investments (5) | 1,895,800 | 9.48 | % | |||||
Linden Advisors LP (6) | 1,100,000 | 5.5 | % | |||||
BAMCO, Inc. (7) | 1,511,845 | 7.56 | % | |||||
Highbridge Capital Management, LLC (8) | 1,094,390 | 5.47 | % |
Amount and | Approximate | |||||||
Nature of | Percentage of | |||||||
Beneficial | Outstanding | |||||||
Name and Address of Beneficial Owner (1) | Ownership | Shares | ||||||
Sarissa Capital Acquisition Sponsor LLC (our sponsor) (2) | 5,000,000 | 20 | % | |||||
Alexander Denner | — | |||||||
Mark DiPaolo | — | |||||||
Eric Vincent | — | |||||||
Odysseas Kostas | — | |||||||
Patrice Bonfiglio | — | |||||||
Keith Horn | — | |||||||
Louis Paglia | 6,000 | * | ||||||
Mark Timney | — | |||||||
All directors and executive officers as a group (eight individuals) | 5,000,000 | 20 | % | |||||
Five Percent Holders: | ||||||||
Castle Creek Arbitrage, LLC (3) | 1,074,820 | 5.37 | % | |||||
683 Capital Management, LLC (4) | 1,200,000 | 6.0 | % | |||||
Putnam Investments, LLC d/b/a/ Putnam Investments (5) | 1,895,800 | 8.70 | % | |||||
Linden Advisors LP (6) | 1,055,218 | 5.3 | % | |||||
BAMCO, Inc. (7) | 1,511,845 | 7.56 | % | |||||
Highbridge Capital Management, LLC (8) | 1,559,583 | 7.80 | % | |||||
The Goldman Sachs Group, Inc. (9) | 1,029,708 | 5.1 | % |
* | Less than 1%. |
(1) | Unless otherwise indicated, the business address of each of the individuals is 660 Steamboat Rd., Greenwich, CT 06830. |
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(2) | Sarissa Capital Management LP is the managing member of our sponsor (the “Managing Member”), and as such, has voting and investment discretion with respect to the ordinary shares held of record by our sponsor and may be deemed to have shared beneficial ownership of the ordinary shares held directly by our sponsor. The general partner of the Managing Member is Sarissa Capital Management GP LLC, and the managing member of Sarissa Capital Management GP LLC is Alexander Denner. Both Sarissa Capital Management GP LLC and Alexander Denner may be deemed to have shared beneficial ownership of the ordinary shares held directly by our sponsor. Each of our officers and directors may hold a direct or indirect interest in our sponsor. Each such person disclaims any beneficial ownership of the reported shares other than to the extent of any pecuniary interest they may have therein, directly or indirectly. |
(3) | The business address of Castle Creek Arbitrage, LLC (“Castle Creek”) is 190 South LaSalle Street, Suite 3050, Chicago, Illinois 60603. Castle Creek serves as a registered investment adviser whose clients are CC Arb West, LLC and CC Arbitrage, Ltd., which directly own |
(4) | The principal business address of 683 Capital Management, LLC is 3 Columbus Circle, Suite 2205, New York, NY 10019. 683 Capital Management, LLC serves as the investment manager of 683 Capital Partners, LP, which owns 1,200,000 (6.0%) Class A ordinary shares. Ari Zweiman is the Managing Member of 683 Capital Management, LLC. By virtue of these relationships, each of 683 Capital Management, LLC and Mr. Zweiman may be deemed to beneficially own the Class A ordinary shares directly owned by 683 Capital Partners, LP. |
(5) | The principal business address of Putnam Investments, LLC d/b/a/ Putnam Investments (“PI”) is 100 Federal Street, Boston, MA 02110. PI wholly owns two registered investment advisers: Putnam Investment Management, LLC (“PIM”), which directly owns 1,895,800 |
(6) | The principal business address for Linden Advisors LP is 590 Madison Avenue, 15th Floor, New York, New York 10022. Linden Advisors LP and Mr. Siu Min (Joe) Wong may be deemed the beneficial owners of |
(7) | The principal business address for BAMCO Inc. is 767 Fifth Avenue, 49 th Floor, New York, New York 10153. BAMCO Inc. is a subsidiary of Baron Capital Group, Inc. and Ronald Baron owns a controlling interest in Baron Capital Group, Inc., and as such, each of Baron Capital Group, Inc. and Ronald Baron may be deemed the beneficial owner of approximately 1,511,845 (7.56%) of Class A ordinary shares outstanding. Baron Global Advantage Fund is an advisory client of BAMCO Inc., and may be deemed the beneficial owner of 1,493,774 (7.47%) of Class A ordinary shares outstanding. |
(8) | The principal business address for Highbridge Capital Management, LLC is 277 Park Avenue, 23rd Floor New York, New York 10172. Highbridge Capital Management, LLC, as the trading manager of Highbridge Tactical Credit Master Fund, L.P., may be deemed to be the beneficial owner of the |
(9) | The principal business address for The Goldman Sachs Group, Inc. is 200 West Street, New York, New York 10282. |
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(A) that would modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination by October 23, 2022 or (B) with respect to any other provision relating to the rights of holders of our Class A ordinary shares. Further, our sponsor and each member of our management team have agreed to vote their founder shares and public shares purchased during or after our offering in favor of our initial business combination.
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Description | ||||
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F-7 |
* Incorporated by reference to the Registrant’s Current Report on Form 8-K filed on October 23, 2020
** Incorporated by reference to the Registrant’s Registration Statement on Form S-1, as amended (SEC File No. 333- 249171).
* **
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DECEMBER 31, 2020
Assets | ||||
Cash and cash equivalents | $ | 1,097,856 | ||
Prepaid expense | 267,935 | |||
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Total current assets | 1,365,791 | |||
Marketable Securities held in Trust Account | 200,002,204 | |||
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Total Assets | $ | 201,367,995 | ||
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Liabilities and Shareholders’ Equity | ||||
Accounts payable | $ | 14,472 | ||
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Total current liabilities | 14,472 | |||
Deferred underwriters’ discount payable | 7,000,000 | |||
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Total liabilities | 7,014,472 | |||
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Commitments and Contingencies | ||||
Class A ordinary shares subject to possible redemption, 18,935,352 shares at $10.00 per share | 189,353,520 | |||
Shareholders’ Equity: | ||||
Preferred shares, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding | — | |||
Class A ordinary shares, $0.0001 par value; 200,000,000 shares authorized; 1,064,648 shares issued and outstanding (excluding 18,935,352 shares subject to possible redemption) | 106 | |||
Class B ordinary shares, $0.0001 par value; 20,000,000 shares authorized; 5,000,000 shares issued and outstanding | 500 | |||
Additional paid-in capital | 5,084,592 | |||
Accumulated deficit | (85,195 | ) | ||
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Total shareholders’ equity | 5,000,003 | |||
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Total Liabilities and Shareholders’ Equity | $ | 201,367,995 | ||
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SHEETS
December 31, 2021 | December 31, 2020 | |||||||
Assets | ||||||||
Current assets: | ||||||||
Cash | $ | 512,884 | $ | 1,097,856 | ||||
Due from Related Party | 6,600 | 0 | ||||||
Prepaid expenses | 99,857 | 267,935 | ||||||
Total current assets | 619,341 | 1,365,791 | ||||||
Marketable securities held in Trust Account | 200,014,811 | 200,002,204 | ||||||
Total Assets | $ | 200,634,152 | $ | 201,367,995 | ||||
Liabilities and Shareholders’ Deficit | ||||||||
Current liabilities: | ||||||||
Accounts payable and accrued expenses | $ | 52,710 | $ | 14,472 | ||||
Total current liabilities | 52,710 | 14,472 | ||||||
Warrant liabilities | 10,167,733 | 30,336,184 | ||||||
Deferred underwriters’ discount payable | 7,000,000 | 7,000,000 | ||||||
Total liabilities | 17,220,443 | 37,350,656 | ||||||
Commitments and contingencies | 0 | 0 | ||||||
Class A ordinary shares, $0.0001 par value, subject to possible redemption at redemption value of $10 per share, 20,000,000 issued and outstanding at December 31, 2021 and December 31, 2020, respectively | 200,000,000 | 200,000,000 | ||||||
Shareholders’ Deficit: | ||||||||
Preference shares, $0.0001 par value; 1,000,000 shares authorized; NaN issued or outstanding at December 31, 2021 and December 31, 2020 | 0— | 0— | ||||||
Class A ordinary shares, $0.0001 par value; 200,000,000 shares authorized; 0 shares issued and outstanding (excluding 20,000,000 Class A shares subject to redemption) at December 31, 2021 and December 31, 2020 | 0— | 0— | ||||||
Class B ordinary shares, $0.0001 par value; 20,000,000 shares authorized; 5,000,000 shares issued and outstanding at December 31, 2021 and December 31, 2020 | 500 | 500 | ||||||
Additional paid-in capital | 0 — | 0 — | ||||||
Accumulated deficit | (16,586,791 | ) | (35,983,161 | ) | ||||
Total shareholders’ deficit | (16,586,291 | ) | (35,982,661 | ) | ||||
Total Liabilities and Shareholders’ Deficit | $ | 200,634,152 | $ | 201,367,995 | ||||
Year ended December 31, 2021 | For the period from August 12, 2020 (inception) to December 31, 2020 | |||||||
Formation and operating costs | $ | 784,688 | $ | 87,399 | ||||
Loss from operations | (784,688 | ) | (87,399 | ) | ||||
Other income | ||||||||
Interest income on marketable securities held in Trust Account | 12,607 | 2,204 | ||||||
Change in fair value of warrant liabilities | 20,168,451 | (17,268,428 | ) | |||||
Offering cost associated with warrants | 0 | (472,585 | ) | |||||
Total other income | 20,181,058 | (17,738,809 | ) | |||||
Net income (loss) | $ | 19,396,370 | $ | (17,826,208 | ) | |||
Weighted average shares outstanding of Class A ordinary shares | 20,000,000 | 9,859,155 | ||||||
Basic and diluted net income (loss) per Class A ordinary share | $ | 0.78 | $ | (1.23 | ) | |||
Weighted average shares outstanding of Class B ordinary shares | 5,000,000 | 4,683,099 | ||||||
Basic and diluted net income (loss) per Class B ordinary share | $ | 0.78 | $ | (1.23 | ) | |||
Ordinary | Additional Paid-In Capital | Accumulated Deficit | Total Shareholders’ Deficit | |||||||||||||||||||||||||
Class A | Class B | |||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||
Balance as of December 31, 2020 | 0 | $ | 0 | 5,000,000 | $ | 500 | $ | 0 | $ | (35,983,161 | ) | $ | (35,982,661 | ) | ||||||||||||||
Net income | — | — | — | — | — | 19,396,370 | 19,396,370 | |||||||||||||||||||||
Balance as of December 31, 2021 | — | $ | — | 5,000,000 | $ | 500 | $ | — | $ | (16,586,791 | ) | $ | (16,586,291 | ) |
Formation and operating costs | $ | 87,399 | ||
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Loss from operations | (87,399 | ) | ||
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Other Income | ||||
Interest income on marketable securities held in trust | 2,204 | |||
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Total other income | 2,204 | |||
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Net loss | $ | (85,195 | ) | |
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Weighted average shares outstanding of Class A redeemable ordinary shares | 20,000,000 | |||
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Basic and diluted net income per share, Class A redeemable ordinary share | $ | 0.00 | ||
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Weighted average shares outstanding of Class B non-redeemable ordinary shares | 4,683,036 | |||
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Basic and diluted net loss per share, Class B non-redeemable ordinary share | $ | (0.02 | ) | |
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Ordinary | Additional Paid-In Capital | Accumulated Deficit | Total Shareholders’ Deficit | |||||||||||||||||||||||||
Class A | Class B | |||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||
Balance as of August 12, 2020 (inception) | 0 | $ | 0 | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||||||||||
Class B ordinary shares issued to Sponsor | 0 | 0 | 5,031,250 | 503 | 24,497 | 0 | 25,000 | |||||||||||||||||||||
Cash in excess of fair value of private placement warrants | — | 0 | — | 0 | 1,064,724 | 0 | 1,064,724 | |||||||||||||||||||||
Forfeiture of 31,250 shares by initial shareholders | 0 | 0 | (31,250 | ) | (3 | ) | 3 | 0 | 0 | |||||||||||||||||||
Accretion of carrying value to redemption value | (1,089,224 | ) | (18,156,953 | ) | (19,246,177 | ) | ||||||||||||||||||||||
Net loss | — | — | — | — | — | (17,826,208 | ) | (17,826,208 | ) | |||||||||||||||||||
Balance as of December 31, 2020 | 0 | $ | 0 | 5,000,000 | $ | 500 | $ | 0 | $ | (35,983,161 | ) | $ | (35,982,661 | ) |
FOR THE PERIOD FROM AUGUST 12, 2020 (INCEPTION) TO DECEMBER 31, 2020
Ordinary | Additional Paid-In Capital | Accumulated Deficit | Total Shareholders’ Equity | |||||||||||||||||||||||||
Class A | Class B | |||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||
Balance as of August 12, 2020 (inception) | — | $ | — | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||
Class B ordinary shares issued to Sponsor | — | — | 5,031,250 | 503 | 24,497 | — | 25,000 | |||||||||||||||||||||
Sale of Units in Initial Public Offering | 20,000,000 | 2,000 | — | — | 199,998,000 | — | 200,000,000 | |||||||||||||||||||||
Sale of Private Placement Warrants | — | — | — | — | 6,000,000 | — | 6,000,000 | |||||||||||||||||||||
Forfeiture of 31,250 shares by initial shareholders | — | — | (31,250 | ) | (3 | ) | 3 | — | — | |||||||||||||||||||
Underwriters’ discount and offering costs charged to the shareholders’ equity | — | — | — | — | (11,586,282 | ) | — | (11,586,282 | ) | |||||||||||||||||||
Change in Class A ordinary shares subject to possible redemption | (18,935,352 | ) | (1,894 | ) | — | — | (189,351,626 | ) | — | (189,353,520 | ) | |||||||||||||||||
Net loss | — | — | — | — | — | (85,195 | ) | (85,195 | ) | |||||||||||||||||||
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Balance as of December 31, 2020 | 1,064,648 | $ | 106 | 5,000,000 | $ | 500 | $ | 5,084,592 | $ | (85,195 | ) | $ | 5,000,003 | |||||||||||||||
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CASH FLOWS
Year ended December 31, 2021 | For the period from August 12, 2020 (inception) through December 31, 2020 | |||||||
Cash Flows from Operating Activities: | ||||||||
Net income (loss) | $ | 19,396,370 | $ | (17,826,208 | ) | |||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||||||||
Formation costs paid by Sponsor in exchange for Class B ordinary shares | 0 | 3,793 | ||||||
Interest earned on marketable securities held in trust | (12,607 | ) | (2,204 | ) | ||||
Change in fair value of warrant liabilities | (20,168,451 | ) | 17,268,428 | |||||
Offering costs allocated with warrants | 0 | 472,585 | ||||||
Changes in operating assets and liabilities: | ||||||||
Prepaid expenses | 168,078 | (267,935 | ) | |||||
Due from Related Party | (6,600 | ) | 0 | |||||
Accounts payable | 38,238 | 14,472 | ||||||
Net cash used in operating activities | (584,972 | ) | (337,069 | ) | ||||
Cash Flows from Investing Activities: | ||||||||
Investment of cash into trust account | 0 | (200,000,000 | ) | |||||
Net cash used in investing activities | 0 | (200,000,000 | ) | |||||
Cash Flows from Financing Activities: | ||||||||
Proceeds from Initial Public Offering, net of underwriters’ discount | 0 | 196,000,000 | ||||||
Proceeds from private placement | 0 | 6,000,000 | ||||||
Payments of offering costs | 0 | (565,075 | ) | |||||
Net cash provided by financing activities | 0 | 201,434,925 | ||||||
Net Change in Cash | (584,972 | ) | 1,097,856 | |||||
Cash—Beginning | 1,097,856 | 0 | ||||||
Cash—Ending | $ | 512,884 | $ | 1,097,856 | ||||
1,097,856 | ||||||||
Supplemental Disclosure of Non-cash Financing Activities: | ||||||||
Deferred underwriters’ discount payable | $ | 0 | $ | 7,000,000 | ||||
Offering costs paid by Sponsor in exchange for issuance of Class B ordinary shares | $ | 0 | $ | 21,207 | ||||
FOR THE PERIOD FROM AUGUST 12, 2020 (INCEPTION) TO DECEMBER 31, 2020
Cash Flows from Operating Activities: | ||||
Net loss | $ | (85,195 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Formation costs paid by Sponsor in exchange for Class B ordinary shares | 3,793 | |||
Interest earned on marketable securities held in trust | (2,204 | ) | ||
Changes in operating assets and liabilities: | ||||
Prepaid expenses | (267,935 | ) | ||
Accounts payable | 14,472 | |||
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Net cash used in operating activities | (337,069 | ) | ||
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Cash Flows from Investing Activities: | ||||
Investment of cash into trust account | (200,000,000 | ) | ||
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Net cash used in investing activities | (200,000,000 | ) | ||
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Cash Flows from Financing Activities: | ||||
Proceeds from Initial Public Offering, net of underwriters’ discount | 196,000,000 | |||
Proceeds from private placement | 6,000,000 | |||
Payments of offering costs | (565,075 | ) | ||
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Net cash provided by financing activities | 201,434,925 | |||
Net Change in Cash | 1,097,856 | |||
Cash - Beginning | — | |||
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Cash - Ending | $ | 1,097,856 | ||
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Supplemental Disclosure of Non-cash Financing Activities: | ||||
Initial value of Class A ordinary shares subject to possible redemption | $ | 189,395,990 | ||
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Change in value of Class A ordinary shares subject to possible redemption | $ | (42,470 | ) | |
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Deferred underwriters’ discount payable charged to additional paid-in capital | $ | 7,000,000 | ||
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Offering costs paid by Sponsor in exchange for issuance of Class B ordinary shares | $ | 21,207 | ||
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See accompanying notes to the financial statements.
Financing
The registration statement for the Company’s IPO was declared effective on October 20, 2020 (the “Effective Date”). On October 23, 2020, the Company consummated the IPO of 20,000,000 units (the “Units”), including the issuance of 2,500,000 Units as a result of the underwriter’s partial exercise of its over-allotment option. Each Unit consists of one Class A ordinary share, $0.0001 par value, and one-third of one redeemable warrant entitling its holder to purchase one Class A ordinary share at a price of $11.50 per share. The Units were sold at an offering price of $10.00 per Unit, generating gross proceeds of $200,000,000 which is described in Note 3.
Simultaneously with the closing of the IPO, the Company consummated the private placement (“Sponsor Private Placement”) with the Sponsor of an aggregate of 3,333,333 warrants (“Sponsor Private Warrants”), generating total proceeds of $5,000,000 and with the underwriter of an aggregate of 666,667 warrants (the “Cantor Private Warrants” and together with Sponsor Private Warrants, “Private Warrants”), each at a price of $1.50 per Cantor Private Warrant, generating total proceeds of $1,000,000, which is described in Note 4.
Transaction costs amounted to $11,586,282 consisting of $4,000,000 of underwriting discount, $7,000,000 of deferred underwriter’s fee and $586,282 of other offering costs. In addition, as of October 23, 2020, $1,457,597 of cash was held outside of the
Trust Account
SARISSA CAPITAL ACQUISITION CORP.
NOTES TO FINANCIAL STATEMENTS
SARISSA CAPITAL ACQUISITION CORP.
NOTES TO FINANCIAL STATEMENTS
SARISSA CAPITAL ACQUISITION CORP.
NOTES TO FINANCIAL STATEMENTS
The underwriter has agreed to waive its rights to the deferred underwriting commission (see Note 6)7) held in the Trust Account in the event the Company does not complete a Business Combination within the Combination Period and, in such event, such amounts will be included with the other funds held in the Trust Account that will be available to fund the redemption of the Public Shares. In the event of such distribution, it is possible that the per share value of the assets remaining available for distribution (including Trust Account assets) will be only $10.00 per share initially held in the Trust Account. In order to protect the amounts held in the Trust Account, the Sponsor has agreed to be liable to the Company if and to the extent any claims by a third party for services rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account to below the lesser of (i) $10.00 per Public Share and (ii) the actual amount per Public Share held in the Trust Account as of the date of the liquidation of the Trust Account if less than $10.00 per Public Share due to reductions in the value of the trust assets. This liability will not apply with respect to any claims by a third party who executed a waiver of any right, title, interest or claim of any kind in or to any monies held in the Trust Account or to any claims under the Company’s indemnity of the underwriters of the IPO against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third partythird-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers (excluding the Company’s independent registered public accounting firm), prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account.
and Going Concern
The Company has obtained a commitment letter from the Sponsor and its members for additional $600,000 funding as needed.
SARISSA CAPITAL ACQUISITION CORP.
NOTES TO FINANCIAL STATEMENTS
Note 2 — Significant Accounting Policies
Basis of Presentation
The accompanying financial statements of the Company is presented in U.S. dollars in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”).
SARISSA CAPITAL ACQUISITION CORP.
NOTES TO FINANCIAL STATEMENTS
is comprised of U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act, with a maturity of 185 days or less, investments in money market funds that invest in U.S. government securities, cash, or a combination thereof. Gains and losses resulting from the change in fair value of these securities is included in interest income on marketable securities held in Trust Account in the accompanying statements of operations. The estimated fair values of investments held in the Trust Account are determined using available market information.
Taxes
SARISSA CAPITAL ACQUISITION CORP.
NOTES TO FINANCIAL STATEMENTS
For the year ended December 31, 2021 | For the period from August 12, 2020 (inception) through December 31, 2020 | |||||||||||||||
Class A | Class B | Class A | Class B | |||||||||||||
Basic and diluted net loss per share: | ||||||||||||||||
Numerator: | ||||||||||||||||
Allocation of net income (loss) | $ | 15,517,096 | $ | 3,879,274 | $ | (12,111,224 | ) | $ | (5,714,984 | ) | ||||||
Denominator: | ||||||||||||||||
Weighted-average shares outstanding | 20,000,000 | 5,000,000 | 9,859,155 | 4,683,099 | ||||||||||||
Basic and diluted net income (loss) per share | $ | 0.78 | $ | 0.78 | $ | (1.23 | ) | $ | (1.23 | ) | ||||||
The Company did not have any dilutive securitiespublic warrants and other contracts that could, potentially, be exercised or converted into ordinary shares and then sharea Modified Black Scholes to value the private warrants with changes in fair value charged to the earningsstatement of the Company. As a result, diluted loss per share is the same as basic loss per share for the period presented.
The following table reflects the calculation of basic and diluted net income (loss) per ordinary share (in dollars, except per share amounts):
For the period From August 12, 2020 (Inception) through December 31, 2020 | ||||
Redeemable Class A ordinary shares | ||||
Numerator: Earnings allocable to Redeemable Class A ordinary shares | ||||
Interest income and realized gain from sale of treasury securities | $ | 2,204 | ||
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Net earnings | $ | 2,204 | ||
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Denominator: Weighted average redeemable Class A ordinary shares | ||||
Redeemable Class A ordinary shares, basic and diluted | 20,000,000 | |||
Earnings/basic and diluted redeemable Class A ordinary shares | $ | 0.00 | ||
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Non-redeemable Class B ordinary shares | ||||
Numerator: Net income minus redeemable net earnings | ||||
Net income (loss) | $ | (85,195 | ) | |
Redeemable net earnings | 2,204 | |||
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Non-redeemable net loss | $ | (87,399 | ) | |
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Denominator: weighted average non-redeemable Class B ordinary shares | ||||
Non-redeemable Class B ordinary shares, basic and diluted | 4,683,036 | |||
Loss/Basic and diluted non-redeemable ordinary shares | $ | (0.02 | ) | |
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operations.
Offering Costs
The Company complies withsheets.
SARISSA CAPITAL ACQUISITION CORP.
NOTES TO FINANCIAL STATEMENTS
Gross Proceeds | $ | 200,000,000 | ||
Less: Proceeds allocated to Public Warrants | (8,132,480 | ) | ||
Less: Issuance costs related to Class A ordinary shares | (11,113,697 | ) | ||
Plus: Accretion of carrying value to redemption value | 19,246,177 | |||
Class A ordinary shares subject to possible redemption | $ | 200,000,000 |
Fair Value Measurements
Fair value is defined assheets, other than derivative warrant liabilities (see Note 9).
Level 1, defined as observable inputs such as quoted prices (unadjusted) for identicalfreestanding 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 indexed to and settled in an entity’s own equity.
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.
The following table presents information about the Company’s assets that are measured at fair value should be applied on a recurringfull or modified retrospective basis, at December 31, 2020 and indicateswith early adoption permitted beginning on January 1, 2021. The Company is currently assessing the fair value hierarchyimpact, if any, that
December 31, 2020 | Quoted Prices In Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Other Unobservable Inputs (Level 3) | |||||||||||||
Description | ||||||||||||||||
Assets: | ||||||||||||||||
Marketable Securities held in Trust Account | $ | 200,002,204 | $ | 200,002,204 | $ | — | $ | — | ||||||||
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$ | 200,002,204 | $ | 200,002,204 | $ | — | $ | — | |||||||||
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In some circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In those instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement. Transfers to/from Levels 1, 2, and 3 are recognized at the end of the reporting period. There were no transfers between levels for the period from August 12, 2020 (inception) through December 31, 2020.
Recent Accounting Standards
SARISSA CAPITAL ACQUISITION CORP.
NOTES TO FINANCIAL STATEMENTS
SARISSA CAPITAL ACQUISITION CORP.
NOTES TO FINANCIAL STATEMENTS
SARISSA CAPITAL ACQUISITION CORP.
NOTES TO FINANCIAL STATEMENTS
– Shareholders’ Deficit
redemption have been classified as temporary equity (see
SARISSA CAPITAL ACQUISITION CORP.
NOTES TO FINANCIAL STATEMENTS
—
SARISSA CAPITAL ACQUISITION CORP.
NOTES TO FINANCIAL STATEMENTS
December 31, | Quoted Prices In Active Markets | Significant Other Observable Inputs | Significant Other Unobservable Inputs | |||||||||||||
2021 | (Level 1) | (Level 2) | (Level 3) | |||||||||||||
Description | ||||||||||||||||
Assets: | ||||||||||||||||
Marketable Securities held in Trust Account | $ | 200,014,811 | $ | 200,014,811 | $ | — | $ | — | ||||||||
Liabilities: | ||||||||||||||||
Warrant Liability – Public Warrants | $ | 6,333,333 | $ | 6,333,333 | $ | — | $ | — | ||||||||
Warrant Liability – Private Warrants | $ | 3,834,400 | $ | — | $ | — | $ | 3,834,400 |
December 31, | Quoted Prices In Active Markets | Significant Other Observable Inputs | Significant Other Unobservable Inputs | |||||||||||||
2020 | (Level 1) | (Level 2) | (Level 3) | |||||||||||||
Description | ||||||||||||||||
Assets: | ||||||||||||||||
Marketable Securities held in Trust Account | $ | 200,002,204 | $ | 200,002,204 | $ | — | $ | — | ||||||||
Liabilities: | ||||||||||||||||
Warrant Liability – Public Warrants | $ | 18,333,334 | $ | 18,333,334 | $ | — | $ | — | ||||||||
Warrant Liability – Private Warrants | $ | 12,002,850 | $ | — | $ | — | $ | 12,002,850 |
As of December 31, 2021 | As of December 31, 2020 | |||||||
Share price | $ | 9.79 | $ | 10.12 | ||||
Strike price | $ | 11.50 | $ | 11.50 | ||||
Term (in years) | 5.41 | 5.91 | ||||||
Volatility | 14.5 | % | 35.0 | % | ||||
Risk-free rate | 1.30 | % | 0.49 | % | ||||
Dividend yield | 0.0 | % | 0.0 | % |
Warrant Liabilities | ||||
Fair value at August 12, 2020 (inception) | $ | 0 | ||
Initial measurement on October 23, 2020 | 13,067,756 | |||
Change in fair value | 17,268,428 | |||
Transfer of Public warrants to Level 1 | (18,333,334 | ) | ||
Fair value at December 31, 2020 | 12,002,850 | |||
Change in fair value | (8,168,450 | ) | ||
Fair Value at December 31, 2021 | $ | 3,834,400 | ||
SARISSA CAPITAL ACQUISITION CORP. | ||
By: | /s/ Alexander Denner | |
Name: | Alexander Denner | |
Title: | Chairman of the Board of Directors and Chief Executive Officer (Principal Executive Officer) |
Name | Title | Date | ||
/s/ Louis Paglia | Director | April 1, 2022 | ||
Louis Paglia | ||||
/s/ Mark Timney | Director | April 1, 2022 | ||
Mark Timney | ||||
/s/ Alexander Denner | Chairman of the Board of Directors and Chief Executive Officer (Principal Executive Officer) | |||
Alexander Denner | ||||
/s/ Patrice Bonfiglio | Chief Financial Officer (Principal Financial and Accounting Officer | |||
Patrice Bonfiglio | ||||
/s/ Keith Horn | Director | April 1, 2022 | ||
Keith Horn |