Berenson Acquisition Corp. I - Quarter Report: 2022 June (Form 10-Q)

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

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

Delaware		87-1070217
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
667 Madison Avenue, 18 th Floor New York, New York		10065
(Address of principal executive offices)		(Zip Code)

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, par value $0.0001 per share and one-half of one Warrant		BACA.U		The New York Stock Exchange
Class A Common Stock, par value $0.0001 per share		BACA		The New York Stock Exchange
Warrants, each whole warrant exercisable for one share of Class A Common Stock at an exercise price of $11.50		BACA WS		The New York Stock Exchange

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

		Page
PART I - FINANCIAL INFORMATION			1
Item 1. Condensed Financial Statements			1
Condensed Balance Sheets as of June 30, 2022 (Unaudited) and December 31, 2021			1
Unaudited Condensed Statements of Operations for the three and six months ended June 30, 2022 and the period from June 1, 2021 (inception) through June 30, 2021			2
Unaudited Condensed Statements of Changes in Redeemable Common Stock and Stockholders’ (Deficit) Equity for the three and six months ended June 30, 2022 and the period from June 1, 2021 (inception) through June 30, 2021			3
Unaudited Condensed Statements of Cash Flows for the six months ended June 30, 2022 and the period from June 1, 2021 (inception) through June 30, 2021			4
Notes to the Unaudited Condensed Financial Statements			5
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			14
Item 3. Quantitative and Qualitative Disclosures About Market Risk			17
Item 4. Controls and Procedures			17
PART II - OTHER INFORMATION			18
Item 1. Legal Proceedings			18
Item 1A. Risk Factors			18
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			18
Item 3. Defaults Upon Senior Securities			18
Item 4. Mine Safety Disclosures			18
Item 5. Other Information			18
Item 6. Exhibits			19

		June 30, 2022 (Unaudited)				December 31, 2021
ASSETS
CURRENT ASSETS:
Cash		$	190,338			$	670,762
Prepaid expenses and other assets			405,379				413,338
Total current assets			595,717				1,084,100
Prepaid expenses and other assets, net of current portion			—				250,786
Cash held in Trust Account			275,502,795				275,105,128
TOTAL ASSETS		$	276,098,512			$	276,440,014
LIABILITIES AND STOCKHOLDERS’ DEFICIT
CURRENT LIABILITIES:
Accounts payable		$	9,375			$	35,194
Accrued expenses			310,069				56,600
Franchise tax payable			52,342				117,310
Total current liabilities			371,786				209,104
Derivative warrant liabilities			2,975,980				10,278,380
Deferred underwriting fee payable			9,628,500				9,628,500
TOTAL LIABILITIES			12,976,266				20,115,984
Commitments and Contingencies
Class A common stock, $0.0001 par value; 200,000,000 shares authorized; 27,510,000 shares issued and outstanding, subject to possible redemption at $10.00 per share			275,100,000				275,100,000
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding			—				—
Class B common stock, $0.0001 par value; 20,000,000 shares authorized; 6,877,500 shares issued and outstanding as of June 30, 2022 and December 31, 2021			688				688
Accumulated deficit			(11,978,442	)			(18,776,658	)
Total stockholders’ deficit			(11,977,754	)			(18,775,970	)
TOTAL LIABILITIES, REDEEMABLE COMMON STOCK AND STOCKHOLDERS’ DEFICIT		$	276,098,512			$	276,440,014

		Three Months Ended June 30, 2022				Six Months Ended June 30, 2022				For the Period from June 1, 2021 (Inception) through June 30, 2021
General and administrative expenses		$	421,131			$	802,010			$	2,700
Franchise tax expenses			50,000				100,000				—
Loss from operations			471,131				902,010				2,700
Other income
Interest income			375,374				397,826				—
Change in fair value of derivative warrant liabilities			2,763,410				7,302,400				—
Total other income			3,138,784				7,700,226				—
Net income (loss) allocable to common stockholders		$	2,667,653			$	6,798,216			$	(2,700	)
Weighted average shares outstanding, redeemable Class A common stock			27,510,000				27,510,000				—
Basic and diluted net income per share, redeemable Class A common stock		$	0.08			$	0.20			$	0.00
Weighted average shares outstanding, non-redeemable common stock			6,877,500				6,877,500				6,250,000
Basic and diluted net income per share, non-redeemable common stock		$	0.08			$	0.20			$	0.00

		FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2022
										Stockholders’ (Deficit) Equity
		Class A Common Stock Subject To Possible Redemption								Class B Common Stock
		Shares				Amount				Shares				Amount				Additional Paid-In Capital				Accumulated Deficit				Total Stockholders’ (Deficit) Equity
Balance – January 1, 2022			27,510,000			$	275,100,000				6,877,500			$	688				—			$	(18,776,658	)		$	(18,775,970	)
Net income			—				—				—				—				—				4,130,563				4,130,563
Balance – March 31, 2022			27,510,000				75,100,000				6,877,500				688				—				(14,646,095	)			(14,645,407	)
Net income			—				—				—				—				—				2,667,653				2,667,653
Balance – June  30, 2022			27,510,000			$	275,100,000				6,877,500			$	688				—			$	(11,978,442	)		$	(11,977,754	)

		FOR THE PERIOD FROM JUNE 1, 2021 (INCEPTION) THROUGH JUNE 30, 2021
										Stockholders’ (Deficit) Equity
		Class A Common Stock Subject To Possible Redemption								Class B Common Stock
		Shares				Amount				Shares				Amount				Additional Paid-In Capital				Accumulated Deficit				Total Stockholders’ (Deficit) Equity
Balance – June 1, 2021 (inception)			—				—				—				—				—				—				—
Issuance of Class B common stock to Sponsor (1)			—				—				7,187,500				719				24,281				—				25,000
Net loss			—				—				—				—				—				(2,700	)			(2,700	)
Balance – J une 30, 2021			—				—				7,187,500			$	719			$	24,281			$	(2,700	)		$	22,300

(1)

This number included an aggregate of up to 937,500 shares of Class B common stock that were subject to forfeiture if the underwriters’ over-allotment option was not exercised in full or in part. Following the expiration of the underwriters’ over-allotment option, on November 12, 2021, the Sponsor forfeited 310,000 shares of Class B common stock.

		For the Six Months Ended June 30, 2022				For the Period from June 1, 2021 (inception) through June 30, 2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)		$	6,798,216			$	(2,700	)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Interest income from trust account			(397,667	)			—
Change in fair value of derivative warrant liabilities			(7,302,400	)			—
Changes in operating assets and liabilities:
Prepaid expenses and other assets			258,745				—
Accounts payable			(25,819	)			—
Accrued expenses			253,469				2,700
Franchise tax payable			(64,968	)			—
Net cash used in operating activities			(480,424	)			—
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock to initial shareholders			—				25,000
Net cash provided by financing activities			—				25,000
NET (DECREASE) INCREASE IN CASH			(480,424	)			25,000
CASH BEGINNING OF PERIOD			670,762				—
CASH END OF PERIOD		$	190,338			$	25,000
SUPPLEMENTAL DISCLOSURE OF NON-CASH ACTIVITIES:
Deferred offering costs included in accrued expenses		$	—			$	102,300
Deferred offering costs included in sponsor loan		$	—			$	15,000

		Three Months Ended June 30, 2022				Six Months Ended June 30, 2022
Class A Common Stock
Numerator: Earnings allocable to Redeemable Class A common stock
Net income allocable to Class A common stock subject to possible redemption		$	2,134,122			$	5,438,573
Denominator: Weighted Average Class A common stock
Basic and diluted weighted average shares outstanding			27,510,000				27,510,000
Basic and diluted net income per share		$	.08			$	0.20
Class B Common Stock
Numerator: Earnings allocable to Class B common stock
Net income allocable to Class B common stock		$	533,531			$	1,359,643
Denominator: Weighted Average Class B common stock
Basic and diluted weighted average shares outstanding			6,877,500				6,877,500
Basic and diluted net income per share			.08			$	0.20

		As of June 30, 2022
		Level 1				Level 2				Level 3				Total
Assets:
U.S. Treasury Securities held in Trust Account		$	275,502,795			$	—			$	—			$	275,502,795
Total:		$	275,502,795			$	—			$	—			$	275,502,795

		As of December 31, 2021
		Level 1				Level 2				Level 3				Total
Assets:
U.S. Treasury Securities held in Trust Account		$	275,105,128			$	—			$	—			$	275,105,128
Total:		$	275,105,128			$	—			$	—			$	275,105,128

		As of June 30, 2022
		Level 1				Level 2				Level 3				Total
Liabilities:
Public Warrants		$	1,925,700			$	—			$	—			$	1,925,700
Private Placement Warrants			—				1,050,280				—				1,050,280
Total		$	1,925,700			$	1,050,280			$	—			$	2,975,980

		As of December 31, 2021
		Level 1				Level 2				Level 3				Total
Liabilities:
Public Warrants		$	6,602,400			$	—			$	—			$	6,602,400
Private Placement Warrants			—				—				3,675,980				3,675,980
Total		$	6,602,400			$	—			$	3,675,980			$	10,278,380

Private Placement Warrant liabilities at January 1, 2022		$	3,675,980
Transfer of Private Placement Warrants From Level 3 to Level 2			(2,025,540	)
Change in fair value of Private Placement Warrant liabilities			(1,650,440	)
Private Placement Warrant liabilities		$	—

References in this Quarterly Report on Form (this “Quarterly Report”) to “we,” “us” or the “Company” refer to Berenson Acquisition Corp. I. References to our “management” or our “management team” refer to our officers and directors, and references to the “Sponsor” refer to Berenson SPAC Holdings I, LLC. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the condensed financial statements and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.

This Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact included in this Quarterly Report including, without limitation, statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors section of this Quarterly Report and our Annual Report of Form for the year ended December 31, 2021 filed with the U.S. Securities and Exchange Commission (the “SEC”) on March 31, 2021. The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

We have neither engaged in any operations nor generated any revenues to date. Our only activities from inception through June 30, 2022 were organizational activities and those necessary to prepare for our Initial Public Offering, and since our Initial Public Offering, our activity has been limited to identifying a target company for a Business Combination. We do not expect to generate any operating revenues until after the completion of our initial Business Combination. We generate income in the form of interest income on marketable securities held in the trust account (the “Trust Account”) with Continental Stock Transfer & Trust Company acting as trustee, located in the United States, established for the benefit of our public stockholders. We incur expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses in connection with searching for, and completing, our initial Business Combination.

We do not believe we will need to raise additional funds in order to meet the expenditures required for operating our business. However, if our estimates of the costs of identifying a target business, undertaking due diligence and negotiating an initial business combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our initial business combination. Moreover, we may need to obtain additional financing either to complete our initial business combination or because we become obligated to redeem a significant number of our public shares upon consummation of our initial business combination, in which case we may issue additional securities or incur debt in connection with such business combination.

Management continues to evaluate the impact of pandemic and has concluded that while it is reasonably possible that the virus could have a negative effect on our financial position, results of its operations and/or our ability to consummate an initial Business Combination, the specific impact is not readily determinable as of the date of the financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

We did not have any sheet arrangements as of June 30, 2022.

We apply the method in calculating net income per share of common stock. The contractual formula utilized to calculate the redemption amount approximates fair value. The class feature to redeem at fair value means that there is effectively only one class of stock. Changes in fair value are not considered a dividend for the purposes of the numerator in the earnings per share calculation. Net income per share of common stock is computed by dividing the pro rata net income between the shares of Class A common stock and the shares of Class B common stock by the weighted average number of shares common stock outstanding for each of the periods. The calculation of diluted income per share of common stock does not consider the effect of the warrants and rights issued in connection with our Initial Public Offering since the exercise of the warrants and rights are contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive. The warrants are exercisable for 21,257,000 shares of Class A common stock in the aggregate.

We account for our shares of common stock subject to possible redemption in accordance with ASC 480. In accordance with the SEC and its staff’s guidance on redeemable equity instruments, which has been codified in ASC redemption provisions not solely within our control require common stock subject to redemption to be classified outside of permanent equity. Ordinary liquidation events, which involve the redemption and liquidation of all of the entity’s equity instruments, are excluded from the provisions of ASC 480.

All of our shares of Class A common stock sold as part of the units in our Initial Public Offering contain a redemption feature which allows for the redemption of such public shares in connection with our liquidation if there is a stockholder vote or tender offer in connection with a business combination and in connection with certain amendments to our amended and restated certificate of incorporation. We recognize changes in redemption value immediately as they occur and adjust the carrying value of redeemable shares of common stock to equal the redemption value at the end of each reporting period. Increases or decreases in the carrying amount of redeemable shares of common stock are affected by charges against additional capital and accumulated deficit.

We are a smaller reporting company as defined by Rule of the Exchange Act and are not required to provide the information otherwise required under this item.

Under the supervision and with the participation of our management, including our principal executive officer and principal financial and accounting officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rules and under the Exchange Act) as of the end of the fiscal quarter ended June 30, 2022. Based on this evaluation, our principal executive officer and principal financial and accounting officer have concluded that during the period covered by this Quarterly Report, our disclosure controls and procedures were effective at a reasonable assurance level and, accordingly, provided reasonable assurance that the information required to be disclosed by us in reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

There was no change in our internal control over financial reporting (as defined in Rules and under the Exchange Act) that occurred during the fiscal quarter ended on June 30, 2022 covered by this Quarterly Report on Form that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Factors that could cause our actual results to differ materially from those in this Quarterly Report are any of the risks described in our Annual Report on Form for the year ended December 31, 2021, filed with the SEC on March 31, 2022 (the “Annual Report”). Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations. As of the date of this Quarterly Report, there have been no material changes to the risk factors disclosed in our Annual Report, except for the following amended and restated risk factor:

On June 25, 2021, we issued 7,187,500shares of Class B common stock, par value $0.0001 per share (the “Founder Shares”) to the Sponsor for an aggregate purchase price of $25,000, or approximately $0.004 per share. On September 15, 2021, the Sponsor transferred an aggregate of 25,000 Founder Shares to each of our independent directors and our special advisor (for a total of 125,000 Founder Shares) for their original purchase price. Subsequently, on September 30, 2021, the Sponsor sold an aggregate of 1,872,159 Founder Shares to eleven qualified institutional buyers or institutional accredited investors that have each purchased units in the Initial Public Offering,at their original purchase price. On November 12, 2021, in connection with the underwriters’ partial exercise of their over-allotment option and waiver of the remaining portion of such option, the Sponsor forfeited an aggregate of 310,000 Founder Shares to us at no cost, accordingly 6,877,500 Founder Shares remain outstanding.

As previously reported on a Current Report on Form on September 30, 2021, simultaneously with the consummation of the Initial Public Offering, we consummated the private placement of an aggregate of 7,000,000 warrants to the Sponsor at a price of $1.00 per private placement warrant, generating gross proceeds of $7,000,000.