Business context and reporting period
This is NewHold Investment Corp.’s unaudited Form 10-Q for the quarter ended March 31, 2021—not an operating-company 10-Q filed by Evolv Technologies Holdings. NewHold was a special purpose acquisition company (SPAC) with no operating business or revenue. On March 5, 2021, it agreed to combine with Evolv Technologies, Inc., which provides AI-based touchless security screening. The transaction remained subject to completion and the filing does not report a completed merger.
Key financial metrics
| Metric | Q1 2021 / March 31, 2021 |
|---|---|
| Revenue | $0 |
| General and administrative expenses | $1.455 million |
| Net loss | $4.082 million, including a $2.646 million noncash loss from increased warrant fair value |
| Trust-account income | $19,000 |
| Operating cash flow | $(749,000) |
| Cash outside trust | $579,000 |
| Cash and investments in trust | $172.598 million; restricted principally for a business combination or specified redemptions |
| Total assets / total liabilities | $173.370 million / $31.679 million |
| Debt | No long-term debt; no working-capital loans outstanding |
| Warrant liability | $24.165 million |
Profit margins are not meaningful for this pre-combination SPAC. The prior-period comparison is the period from inception on January 24, 2020 through March 31, 2020, when net loss was $2,000; it is not a like-for-like quarterly comparison.
Material changes and unusual items
- Net loss rose from $2,000 in the prior inception-period comparison to $4.082 million, largely reflecting current-period business-combination search and professional costs and warrant remeasurement.
- Cash outside the trust fell from $1.328 million at December 31, 2020 to $579,000. Operating activities used $749,000; increases in operating liabilities partly offset cash use.
- Public shares classified as temporary equity subject to possible redemption totaled $136.691 million at quarter-end, versus $140.774 million at year-end.
- The filing says warrant-accounting changes required restatement of previously issued financial statements. Warrants are carried as liabilities at fair value, with quarter-to-quarter changes recorded in earnings.
Outlook, risks, and controls
Management said available working capital was sufficient for at least the next 12 months, but expected significant additional transaction, due-diligence, and professional costs. The trust yielded less than 0.1% annually, and management said trust income was unlikely to cover permitted tax and working-capital withdrawals. NewHold had until August 4, 2022 to complete a business combination or liquidate and redeem public shares under the stated terms. COVID-19 could disrupt the transaction search or affect a prospective target; the specific impact was not determinable.
Management concluded disclosure controls were ineffective as of March 31, 2021 and reported a material weakness in controls over warrant classification, associated with the restatement. The company said it was engaging technical-accounting and valuation consultants and enhancing its review procedures. The filing reports no material changes to previously disclosed risk factors and no legal proceedings.
Important facts for investors to verify
- Confirm the filing entity and period: NewHold Investment Corp., Q1 2021; do not treat these figures as Evolv’s operating results.
- Review the merger agreement, subsequent transaction status, approvals, financing terms, and any dilution or redemption effects in later filings.
- Check the restated financial statements and warrant-accounting disclosures, including the reported material weakness and remediation progress.
- Assess NewHold’s available cash outside the trust against expected transaction costs and the August 4, 2022 completion deadline.
- The filing contains date inconsistencies in its contents and accounting-policy references; confirm the comparative balance-sheet date and other figures against the filed statements and subsequent reports.