ENVIRONMENTAL IMPACT ACQUISITION: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND OPERATING RESULTS (Form 10-K)

References to the “Company”, “we”, “our” or “we” refer to Environmental impact Acquisition Corp. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our audited financial statements and the accompanying notes included herein.

Caution Regarding Forward-Looking Statements

All statements other than statements of historical fact included in this Form 10-K, including, without limitation, statements under “Management’s Review and Analysis of Financial Condition and Results of Operations” regarding the The Company’s financial condition, business strategy and management’s plans and objectives for future operations are forward-looking statements. When used in this Form 10-K, words such as “anticipate”, “believe”, “estimate”, “” ” ” ” s. These forward-looking statements are based on the beliefs of management, as well as on the assumptions made by the management of the Company and on the information currently available to the latter. Actual results could differ materially from those contemplated in forward-looking statements due to certain factors detailed in our documents filed with the SECOND. All subsequent written or oral forward-looking statements attributable to us or to persons acting on behalf of the Company are qualified in their entirety by this paragraph.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the financial statements and related notes contained elsewhere in this report. Certain information contained in the discussion and analysis presented below includes forward-looking statements that involve risks and uncertainties.


Overview


We are a blank check company incorporated under the laws of Delaware state to
July 2, 2020, with the aim of carrying out a merger, a capital stock exchange, an acquisition of assets, a purchase of shares, a reorganization or any other similar business combination with one or more companies. We intend to effect our business combination using the cash generated from the proceeds of the initial public offering and the sale of private placement warrants, our share capital, our debts or a combination of cash, stocks and debt.

We expect to continue to incur significant costs in pursuing our acquisition plans. We cannot assure you that our plans to complete a business combination will be successful.


Results of Operations


We have not engaged in any activity or generated any operating income to date. Our only activities from the beginning to December 31, 2020 were organizational activities and those necessary for the preparation of the Initial Public Offer, described below. We do not expect to generate any revenue until the completion of our first business combination. We expect to generate non-operating income in the form of interest income on marketable securities held after the initial public offering. We anticipate that we will incur increased expenses due to our public company status (for legal, financial, accounting and audit compliance), as well as for due diligence expenses related to finding and completing a business combination.

For the period of July 2, 2020 (creation) through December 31, 2020, we suffered a net loss of $ 2,528, which consisted of incorporation and operating costs.


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Liquidity and capital resources

From December 31, 2020, we had cash from $ 156,848. Until the completion of the initial public offering, our only source of liquidity was an initial purchase of common shares by the original shareholders and a loan from a related party.

At January 19, 2021, we carried out the initial public offering of 20,700,000 units, at a price of $ 10.00 per unit which included the full exercise by the underwriters of their over-allotment option in the amount of 2,700,000 units, generating gross proceeds of $ 207,000,000. Concurrently with the closing of the initial public offering, we completed the sale of 2,000,000 private placement warrants to initial shareholders at a price of $ 1.00 per Private Placement Bond generating gross proceeds of $ 2,000,000.

Following the initial public offering, the full exercise of the over-allotment option and the sale of the Private Placement Warrants, a total of $ 207,000,000
was placed in the trust account. we hired $ 773,917 in transaction costs, including $ 250,000 cash subscription fees and commissions, including $ 150,000
paid for the underwriters’ concession fees, and $ 523,918 other supply costs.

We intend to use substantially all of the funds held in the trust account, including any amount representing interest earned on the trust account (less income taxes payable), to complete our business combination. ‘companies. To the extent that our share capital or debt is used, in whole or in part, in consideration for the completion of our business combination, the remaining proceeds held in the trust account will be used as working capital to fund operations. of the target company or companies. , make other acquisitions and pursue our growth strategies.

We intend to use funds held outside the trust account primarily to identify and assess target businesses, conduct due diligence on potential target businesses, travel to and from offices, factories or similar locations of target businesses. potential target companies or their representatives or owners, review corporate documents and material agreements of potential target companies, and structure, negotiate and complete a business combination.

In order to fill working capital shortfalls or finance transaction costs in a business combination, our sponsor or an affiliate of our sponsor or certain of our officers and directors may, but are not obligated to do so, lend us funds as needed. If we complete a Business Combination, we may repay these loaned amounts from the Trust Account proceeds remitted to us. In the event that a business combination is not concluded, we may use part of the working capital held outside the trust account to repay the amounts loaned, but no proceeds from our trust account would be used for such. refund. Up to $ 1,500,000 of these loans may be convertible into shares at a price of $ 10.00 per unit at the option of the lender. The units would be identical to the placement units.

We do not believe that we need to raise additional funds to cover the expenses necessary to operate our business. However, if our estimate of the costs of identifying a target business, performing due diligence and negotiating a business combination is less than the actual amount needed to do so, we may not have sufficient funds to operate our business before our business. Combination. In addition, we may need to obtain additional financing either to complete our business combination or because we are obligated to repurchase a significant number of our public shares during the completion of our business combination, in which case. we may issue additional securities or incur debt as part of such business combination. Subject to compliance with applicable securities laws, we would only complete this financing concurrently with the completion of our business combination. If we are unable to complete our business combination because we do not have sufficient funds, we will be forced to cease operations and liquidate the trust account. In addition, following our Business Combination, if available liquidity is insufficient, we may need to obtain additional financing in order to meet our obligations.


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Off-balance sheet financing arrangements

We do not have any obligations, assets or liabilities that would be considered off-balance sheet arrangements in the December 31, 2020. We do not participate in transactions creating relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established special purpose entities, guaranteed the debts or commitments of other entities, or purchased non-financial assets.


Contractual Obligations


We have no long-term debt, capital lease obligations, operating leases or long-term liabilities except as described below.

The Company paid the independent underwriter a fee of $ 100,000 the completion of the initial public offering in return for his services and expenses as a qualified independent underwriter. In addition, the Company has agreed to pay the subscriber $ 150,000 in expenses to cover the concessions of the seller to the member of the selling group under the Proposed Public Offer. The Independent Underwriter will not receive any other compensation.

The Company is committed Canaccord Genuity LLC (“Canaccord”) as advisors in its business combination to assist the Company in arranging meetings with its shareholders to discuss the potential business combination and the attributes of the target business, introduce the Company to potential investors who may be interested in purchasing the securities, assist the Company in obtaining shareholder approval for the Business Combination and assist the Company in the preparation of its press releases and public documents in as part of the Business Combination. The Company will pay Canaccord for these services on the completion of a business combination a cash remuneration of an amount equal to 3.76% of the gross proceeds of the initial public offering if the over-allotment option of the underwriters is exercised in full. In accordance with the terms of the business combination marketing agreement, no commission will be payable if the Company does not complete a business combination.


Critical Accounting Policies


The preparation of financial statements and related information in accordance with generally accepted accounting principles in United States of America
requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and revenues and expenses during the reported period . Actual results could differ materially from these estimates. We have not identified any critical accounting policy in the
December 31, 2020.



Recent Accounting Standards



Management does not believe that any other accounting standard published recently, but not yet effective, if currently adopted, would have a material impact on our financial statements.

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