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Item 2. Management’s Discussion and Analysis

2021-11-22 compared with 2021-08-16 · 45 added, 42 removed, 59 unchanged (60% of the section changed)

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Special Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q

includes “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of 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 Form 10-Q

including 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.

This Quarterly Report on Form 10-Q includes

“forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of 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 Form 10-Q including

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.

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Results of Operations

For the three months ended June 30, 2021 and for period from January 11, 2021 (inception) to June 30, 2021, we incurred a loss from operations of $822,896 and $912,461, respectively.

For the three months ended September 30, 2021 and for period from January 11, 2021 (inception) to September 30, 2021, we had a loss from operations of $481,907 and $1,394,368, respectively.

In addition to the loss from operations, we recognized other income of $3,325,655 and $6,659,509, respectively consisting of an unrealized gain on our warrant liability of $3,320,750 and $7,188,075, respectively and interest income of $4,905, and $10,211, respectively partially offset by transaction costs related to our IPO of $0 and $538,777, respectively.

Through June 30, 2021, our efforts have been limited to organizational activities, activities relating to identifying and evaluating prospective acquisition candidates and activities relating to general corporate matters.

Through September 30, 2021, our efforts have been limited to organizational activities, activities relating to identifying and evaluating prospective acquisition candidates and activities relating to general corporate matters.

We have not generated any realized income, other than interest income.

The unrealized gain on the warrant liability resulted from the change in fair value of our warrant liability and had no impact on cash.

As of June 30, 2021, $319,221,644 was held in the Trust Account.

We had cash outside of trust of $704,019 in June 30, 2021 and $103,027 accounts payable and accrued expenses as of June 30, 2021.

Except with respect to interest earned on the funds held in the Trust Account that may be released to us to pay taxes, if any, the proceeds in the Trust will not be released from the Trust Account (1) to us, until the completion of our initial Business Combination, or (2) to the Public Shareholders, until the earliest of (i) the completion of our initial Business Combination, and then only in connection with those Class A ordinary shares that such shareholders properly elected to redeem, subject to the limitations, (ii) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and restated memorandum and articles of association (A) to 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 the public shares if we do not complete an initial Business Combination within 24 months from the closing of the IPO (the “Combination Period”) or (B) with respect to any other provision relating to the rights of holders of the Class A ordinary shares, and (iii) the redemption of the public shares if we have not consummated a Business Combination within the Combination Period, subject to applicable law.

As of September 30, 2021, $319,226,549 was held in the Trust Account.

We had cash outside of trust of $368,210 in September 30, 2021 and $100,140 accounts payable and accrued expenses as of September 30, 2021.

shares redeemed in connection with our initial Business Combination or to redeem 100% of the public shares if we do not complete an initial Business Combination within 24 months from the closing of the IPO (the “Combination Period”) or (B) with respect to any other provision relating to the rights of holders of the Class A ordinary shares, and (iii) the redemption of the public shares if we have not consummated a Business Combination within the Combination Period, subject to applicable law.

Liquidity and Capital Resources

As of June 30, 2021, we had cash outside our Trust Account of $704,019, available for working capital needs.

As of September 30, 2021, we had cash outside our Trust Account of $368,210, available for working capital needs.

We intend to use the funds held outside the Trust Account for identifying and evaluating prospective acquisition candidates, performing business due diligence on prospective target businesses, traveling to and from the offices, plants or similar locations of prospective target businesses, reviewing corporate documents and material agreements of prospective target businesses, selecting the target business to acquire and structuring, negotiating and consummating the Business Combination.

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Following the sale of our Units and the sale of the Private Warrants, a total of $319,216,340 ($10.00 per Unit) was placed in the Trust Account.

We incurred $18,336,269 in Initial Public Offering related costs, including $6,384,327 of underwriting fees, $11,172,572 of deferred underwriting discount and $779,370 of other costs with $538,777 which was allocated to the Public Warrants and Private Warrants, included in the statement of operations and $17,797,492 included in stockholders’ equity.

As of June 30, 2021, we had marketable securities held in the Trust Account of $319,221,644 (including approximately $5,304 of income) consisting of money market funds.

As of September 30, 2021, we had marketable securities held in the Trust Account of $319,226,549 (including approximately $10,209 of income) consisting of money market funds.

Income on the balance in the Trust Account may be used to pay taxes.

Through June 30, 2021, we did not withdraw any interest earned on the Trust Account to pay our taxes.

For six months ended June 30, 2021, cash used in operating activities was $1,541,611.

Through September 30, 2021, we did not withdraw any interest earned on the Trust Account to pay our taxes.

For nine months ended September 30, 2021, cash used in operating activities was $1,877,420.

Net income of $5,265,141 was primarily offset by an unrealized gain on the change in the fair value of our warrant liability of $7,188,075 and payments generating prepaid assets of $660,308.

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To the extent that our equity or debt is used, in whole or in part, as consideration to complete our initial business combination, the remaining proceeds held in the Trust Account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.

Further, our sponsor, officers and directors or their respective affiliates may, but are not obligated to, loan us funds as may be required (the “Working Capital Loans”).

Further, our sponsor, officers and directors or their respective affiliates have committed to loan us funds as may be required (the “Working Capital Loans”).

If we complete a business combination, we would repay the Working Capital Loans.

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The notes would either be repaid upon consummation of a business combination, without interest, or, at the lender’s discretion, or converted upon consummation of a business combination into additional Private Warrants at a price of $1.50 per Private Warrant.

As of June 30, 2021, no Working Capital Loans have been issued.

As of September 30, 2021, no Working Capital Loans have been issued.

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 estimate of the costs of identifying a target business, undertaking in-depth

due diligence and negotiating a 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 business combination.

However, if our estimate of the costs of identifying a target business, undertaking in-depth due

diligence and negotiating a 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 business combination.

Moreover, in addition to the access to the Working Capital Loans, we may need to obtain other financing either to complete our business combination or because we become obligated to redeem a significant number of our public shares upon consummation of our business combination, in which case we may issue additional securities or incur debt in connection with such business combination.

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In addition, following our business combination, if cash on hand is insufficient, we may need to obtain additional financing in order to meet our obligations.

Sheet Arrangements

We have no obligations, assets or liabilities which would be considered off-balance

sheet arrangements as of June 30, 2021.

We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance

sheet arrangements.

We have not entered into any off-balance

sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or entered into any non-financial

agreements involving assets.

Off-Balance Sheet

We have no obligations, assets or liabilities which would be considered off-balance sheet

arrangements as of September 30, 2021.

arrangements.

We have not entered into any off-balance sheet

financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or entered into any non-financial agreements

involving assets.

Contractual obligations

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This assessment, which requires the use of professional judgment, is conducted at the time of issuance of the Warrants and as of each subsequent quarterly period end date while the Warrants are outstanding.

For issued or modified warrants that meet all of the criteria for equity classification, such warrants are required to be recorded as a component of additional paid-in capital at the time of issuance.

For issued or modified warrants that meet all of the criteria for equity classification, such warrants are required to be recorded as a component of additional paid-in

capital at the time of issuance.

For issued or modified warrants that do not meet all the criteria for equity classification, liability-classified warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter.

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The Company recognizes changes in redemption value immediately as they occur and will adjust the carrying value of the security at the end of each reporting period.

Increases or decreases in the carrying amount of redeemable shares will be affected by charges against additional paid-in

Increases or decreases in the carrying amount of redeemable shares will be affected by charges against additional paid-in capital.

Net Income Per Ordinary Share

Net income per ordinary share is computed by dividing net income by the weighted average number of ordinary shares outstanding for each of the periods.

The calculation of diluted net income per ordinary shares does not consider the effect of the warrants issued in connection with the (i) IPO, (ii) exercise of over-allotment and (iii) Private Placement since the exercise of the warrants are contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive.

The warrants are exercisable to purchase 12,000,000 shares of Class A ordinary shares in the aggregate.

Our statement of operations include a presentation of net income per share for Class A ordinary shares subject to possible redemption in a manner similar to the two-class

method of income per ordinary share.

Net income per Class A ordinary share, basic and diluted, for redeemable Class A ordinary share is calculated by dividing the interest income earned on the Trust Account, by the weighted average number of redeemable Class A ordinary shares outstanding since original issuance.

Net income per ordinary share, basic and diluted, for non-redeemable

Class A and Class B ordinary shares is calculated by dividing the net income, adjusted for income attributable to redeemable Class A ordinary share, by the weighted average number of non-redeemable

Class A and Class B Ordinary share outstanding for the periods.

Non-redeemable

Class B ordinary share include the Founder Shares as these ordinary shares do not have any redemption features and do not participate in the income earned on the Trust Account.

The Company has two classes of shares, which are referred to as Class A ordinary shares and Class B ordinary shares.

Earnings and losses are shared pro rata between the two classes of shares.

The potential ordinary shares for outstanding warrants to purchase the Company’s shares were excluded from diluted earnings per share for the three and nine months ended September 30, 2021 because the warrants are contingently exercisable, and the contingencies have not yet been met.

As a result, diluted net income per common share is the same as basic net income per common share for the periods.

Recent accounting standards

Management does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on our condensed financial statements.

In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06, Debt -- Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments.

ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity.

The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity.

ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if converted method for all convertible instruments.

ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021.

The Company adopted ASU 2020-06 effective January 1, 2021.

The adoption of ASU 2020-06 did not have an impact on the Company’s financial statements.

Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed financial statements.

Management does not believe that any recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on the Company’s unaudited condensed financial statements.

Quantitative and Qualitative Disclosures About Market Risk

We are a smaller reporting company as defined by Rule 12b-2 of the

Exchange Act and are not required to provide the information otherwise required under this item.

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange

Act and are not required to provide the information otherwise required under this item.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis