immediately prior to the closing of the Business Combination, surrendered to Switchback, for no consideration and as a capital contribution to Switchback, 984,706 Founder Shares held by them (on
a pro rata basis), whereupon such Founder Shares were immediately cancelled and (b) upon and subject to the closing of the Business Combination, subjected the 900,000 Founder Earn Back Shares (including any Common Stock issued in exchange
therefor in the Merger) held by them (on a pro rata basis) to potential forfeiture if the closing of the Business Combination volume-weighted average closing sale price of one share of Common Stock quoted on the NYSE does not satisfy the price
target set forth in the Founders Stock Letter for any ten trading days within any 20 consecutive trading day period within the five-year period following the closing of the Business Combination (the Founder Earn Back Trigger Event). The
Founder Earn Back Shares achieved the Founder Earn Back Trigger Event requirements on March 12, 2021.
Private Warrants and Related Party Loans
The Sponsor purchased an aggregate of 5,521,568 Private Warrants for a purchase price of $1.50 per warrant in private placements that occurred
simultaneously with the closing of the IPO and the sale of the over-allotment units. As such, the Sponsors interest in this transaction was valued at approximately $8.3 million. Each Private Warrant entitles the holder to purchase one
share of our Common Stock at $11.50 per share. In addition, prior to the closing of the Business Combination, the Sponsor advanced to Switchback approximately $2.0 million in working capital loans. At the closing of the Business Combination on
February 26, 2021, the Sponsor converted $1.5 million of these working capital loans into 1,000,000 Private Warrants. As such, the Sponsors interest in this transaction was valued at approximately $1.5 million. The remainder of
the loans were repaid in connection with the closing of the Business Combination on February 26, 2021.
Administrative Services Agreement
On July 25, 2019, Switchback entered into an administrative services agreement pursuant to which Switchback paid the Sponsor a total of
$10,000 per month for office space, utilities, secretarial support and administrative services. Upon completion of the Business Combination, we ceased paying these monthly fees.
Other than these monthly fees, no compensation of any kind, including finders and consulting fees, was paid by us to the Sponsor, officers and
directors, or any of their respective affiliates, for services rendered prior to or in connection with the completion of the Business Combination. However, these individuals were reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf. There was no cap or ceiling on the reimbursement of
out-of-pocket expenses incurred by such persons in connection with activities on our behalf.
Related Party Loans and Advances
Until the
consummation of the Switchbacks initial public offering, consummated on July 30, 2019, of 31,411,763 units (including 1,411,763 units that were subsequently issued to the underwriters in connection with their partial exercise of their
overallotments option) at $10.00 per unit, Switchbacks only source of liquidity was an initial sale of Founder Shares to the Sponsor, and the proceeds of loans and advances from the Sponsor in the amount of $251,000. In August 2019, we repaid
the Sponsor $251,000 in settlement of the outstanding loan and advances.
In addition, prior to the closing of the Business Combination, the Sponsor
advanced to Switchback approximately $2.0 million in working capital loans. At the closing of the Business Combination, the Sponsor converted $1.5 million of these working capital loans into 1,000,000 Private Warrants. As such, the
Sponsors interest in this transaction was valued at approximately $1.5 million. $1.5 million of such loans were convertible into warrants at a price of $1.50 per warrant at the option of the Sponsor. The warrants are identical to the
Private Warrants, including as to exercise price, exercisability and exercise period. The remainder of the loans were repaid in connection with the closing of the Business Combination.
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