Form 10-Q: 0001829126-22-011726 compared to 0001193125-21-338712
0001854863 false0.0001 Q3--12-12/31 00018548632022Our initial shareholders initially held 5,750,000 Class B ordinary shares, up to 750,000 of which were subject to forfeiture by our sponsor depending on the extent to which the underwriters’ over- allotment option is exercised. Such shares have been capitalized into 2,548,979 Class F ordinary shares and 5,097,958 Class G ordinary shares. Pursuant to a re-capitalization of our share capital effective July 5, 2021, the Class B ordinary shares have been canceled and all of the shares presently issued and outstanding are Class F ordinary shares and Class G ordinary shares (Class G ordinary shares are subject to vesting). All share and per-share amounts have been retroactively restated to reflect the share capitalization and return of shares (see Notes 5 and 8)On August 18, 2021, the underwriters partially exercised the over-allotment option resulting in the issuance of an additional 326,757 Class F ordinary shares and 653,513 Class G ordinary shares to the Sponsor.Represents the non-cash gain on the change in valuation of the Private Placement Warrants and is included in Gain on change in fair value of warrant liability in the unaudited condensed statement of operations.Represents the non-cash gain on the change in valuation of the FPA asset and is included in Gain on change in fair value of FPA asset in the unaudited condensed statement of operations. 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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
 
FORM  

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

 

FORM 10-Q

 
 
 
 

 

 

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended

 

For the quarterly period ended September 30, 2021March 31, 2022 

OR
 
 

 

OR

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from
    
    
        
    
 to
    
    
        
    
 
Commission file number:

 

For the transition period from ________ to ________

 

Commission file number: 001-40706

 
 
 

 

 

 

Blue Whale Acquisition Corp I 

(Exact name of registrant as specified in its charter) 

 
 
 

 

 

 

Cayman Islands   98-1590107
Cayman Islands
 
98-1590107
(State or other jurisdiction of

(State or other jurisdiction of

incorporation or organization)

  
(I.R.S. Employer
Identification Number)
     

PO Box 1093, , Boundary Hall

Cricket Square,, Grand Cayman

Cayman Islands

  
KY1-1102
(Address of principal executive offices)
  
(Zip Code)

 

Registrant’s telephone number, including area code: +1 (345(345))

 949-8066 
 
 
Securities registered pursuant to Section 12(b) of the Act:
 
Title of Each Class:
 
Trading
Symbol(s)
 
Name of Each Exchange
on Which Registered:
Units, each consisting of one share of Class A ordinary shares, $0.0001 par value, and
one-fourth
 of one redeemable warrant
 
BWCAU
 
The Nasdaq Stock Market LLC
Shares of Class A ordinary shares included as part of the units
 
BWC
 
The Nasdaq Stock Market LLC
Redeemable warrants included as part of the units, each whole warrant exercisable for one share of Class A ordinary shares at an exercise price of $11.50
 
BWCAW
 
The Nasdaq Stock Market LLC
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  
 
 
 

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  ☒    No  ☐

No ☐

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405

of Regulation S-T (§ 232.405
of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).     Yes  ☒    No  ☐
No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated

filer, a non-accelerated filer, smaller
reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company”
in Rule 12b-2 of the
Exchange Act. 
 

 

Large accelerated filer Accelerated filer
Large accelerated filer   Accelerated filer 
    
Non-accelerated filer
    Smaller reporting company  
        
     Emerging growth companyEmerging growth company  

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.    

 

Indicate by check mark whether the registrant is a shell company (as defined

in Rule 12b-2 of the
 Exchange Act).    Yes    Exchange Act). Yes ☒   No  ☐
 
As of November 23

 

Securities registered pursuant to Section 12(b) of the Act:

 

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, $0.0001 par value, and one-fourth of one redeemable warrant   BWCAU   The Nasdaq Stock Market LLC
Shares of Class A common stock included as part of the units   BWC   The Nasdaq Stock Market LLC
Redeemable warrants included as part of the units, each whole warrant exercisable for one share of Class A common stock at an exercise price of $11.50   BWCAW   The Nasdaq Stock Market LLC

 

Securities registered pursuant to Section 12(g) of the Act: None

 

As of May 20, 20212022, there were 22,940,811 Units

,
, 2,548,979
shares of the Registrant’s Class  F ordinary sharescommon stock, par value $0.0001 per share, and 5,097,958
shares of the Registrant’s Class  G ordinary shares, par value $0.0001 per share issued and outstanding.common stock, par value $0.0001 per share issued and outstanding.

 

 

 

 

 
 
 
 
 
 

BLUE WHALE ACQUISITION CORP I
1
 
Quarterly Report on

 

 

BLUE WHALE ACQUISITION CORP I

 

Quarterly Report on Form 10-Q

 
Table of Contents
 

 

Table of Contents

 

      Page No.
PART I. FINANCIAL INFORMATION    
Item 1. Financial Statements   1
Condensed Balance Sheets as of March 31, 2022 (Unaudited) and December 31, 2021   1
Condensed Statements of Operations for the three months ended March 31, 2022 and for the period from March 10, 2021 (inception) through March 31, 2021 (Unaudited)   2
Condensed Statements of Changes in Shareholders’ Equity (Deficit) for the three months ended March 31, 2022 and for the period from March 10, 2021 (inception) through March 31, 2021 (Unaudited)   3
Condensed Statements of Cash Flows for the three months ended March 31, 2022 and for the period from March 10, 2021 (inception) through March 31, 2021 (Unaudited)   4
Notes to Condensed Financial Statements (Unaudited)   5
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations   20
Item 3. Quantitative and Qualitative Disclosures About Market Risk   24
Item 4. Controls and Procedures   24
       
PART II. OTHER INFORMATION    
Item 1. Legal Proceedings   26
Item 1A. Risk Factors   26
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds from Registered Securities   27
Item 3. Defaults Upon Senior Securities   28
Item 4. Mine Safety Disclosures   28
Item 5. Other Information   28
Item 6. Exhibits   29

 

i


 
 
 
PART I—FINANCIAL INFORMATION
 
Item 1. Financial Statements
 
 
 
BLUE WHALE ACQUISITION CORP I
 
CONDENSED BALANCE SHEET
 
 
 
(UNAUDITED)
 
 
 
 
  
(1) 
Our initial shareholders initially held 5,750,000 Class B ordinary shares, up to 750,000 of which were subject to forfeiture by our sponsor depending on the extent to which the underwriters’ over- allotment option is exercised. Such shares have been capitalized into 2,548,979 Class F ordinary shares and 5,097,958 Class G ordinary shares. Pursuant to a
re-capitalization
 of our share capital effective July 5, 2021, the Class B ordinary shares have been canceled and all of the shares presently issued and outstanding are Class F ordinary shares and Class G ordinary shares (Class G ordinary shares are subject to vesting). All share and
per-share
 amounts have been retroactively restated to reflect the share capitalization and return of shares (see Notes 5 and 8)
 
 
  
(2) 
On August 18, 2021, the underwriters partially exercised the over-allotment option resulting in the issuance of an additional
 326,757 
Class F ordinary shares and
 653,513 
Class G ordinary shares to the Sponsor.
 
 
 
The accompanying notes are an
integral part of these unaudited condensed financial statements. 
 
 
 
1
 
 
 
 
 
 
 
 
 
 
 
 
BLUE WHALE ACQUISITION CORP I
 
CONDENSED STATEMENTS OF OPERATIONS
 
(UNAUDITED)
 
 
 
 
  
(1) 
Our initial shareholders initially held 5,750,000 Class B ordinary shares, up to 750,000 of which were subject to forfeiture by our sponsor depending on the extent to which the underwriters’ over- allotment option is exercised. Such shares have been capitalized into 2,548,979 Class F ordinary shares and 5,097,958
 
Class G ordinary shares. Pursuant to a
re-capitalization
 of our share capital effective July 5, 2021, the Class B ordinary shares have been canceled and all of the shares presently issued and outstanding are Class F ordinary shares and Class G ordinary shares (Class G ordinary shares are subject to vesting). All share and
per-share
 amounts have been retroactively restated to reflect the share capitalization and return of shares (see Notes 5 and 8)
 
 
  
(2) 
On August 18, 2021, the underwriters partially exercised the over-allotment option resulting in the issuance of an additional
 326,757
 
Class F ordinary shares and
 653,513 
Class G ordinary shares to the Sponsor.
 
 
 
The accompanying notes are an integral part of these unaudited condensed financial statements.

 

 

Item 1. Financial Statements

 

BLUE WHALE ACQUISITION CORP I

CONDENSED BALANCE SHEETS

 

           
  

March 31,

2022

   December 31,
2021
 
   (Unaudited)     
ASSETS          
Current assets          
Cash  $2,406,907   $66,156 
Prepaid Expenses - current   789,733    801,822 
Total Current Assets   3,196,640    867,978 
FPA       150,000 
Prepaid Expenses – non-current   260,000    455,000 
Cash held in Trust Account   229,408,110    229,408,110 
TOTAL ASSETS  $232,864,750   $230,881,088 
           
LIABILITIES, CLASS A ORDINARY SHARES SUBJECT TO POSSIBLE REDEMPTION AND SHAREHOLDERS’ DEFICIT          
Current liabilities          
Accrued Expenses  $1,159,630   $966,011 
Promissory Note Payable   156,384    156,384 
Accounts Payable – related party   325,000    325,000 
Total Current Liabilities   1,641,014    1,447,395 
Convertible Note – related party   2,500,000     
Warrant Liability   4,514,642    7,674,891 
Deferred underwriting fee payable   8,029,284    8,029,284 
Total Liabilities   16,684,940    17,151,570 
           
Commitments and Contingencies (Note 6)          
Class A Ordinary Shares Subject to Possible Redemption, 22,940,811 shares at redemption value at March 31, 2022 and December 31, 2021, respectively   229,408,110    229,408,110 
Shareholders’ Deficit          
Preferred shares, $0.0001 par value; 5,000,000 shares authorized; none outstanding        
Class A ordinary shares, $0.0001 par value; 500,000,000 shares authorized; none issued and outstanding (excluding 22,940,811 shares subject to redemption) at March 31, 2022 and December 31, 2021, respectively        
Class F ordinary shares, $0.0001 par value; 30,000,000 shares authorized, 2,548,979 shares issued and outstanding at March 31, 2022 and December 31, 2021, respectively   255    255 
Class G ordinary shares, $0.0001 par value; 30,000,000 shares authorized, 5,097,958 shares issued and outstanding at March 31, 2022 and December 31, 2021, respectively   509    509 
Additional paid-in capital        
Accumulated Deficit   (13,229,064)   (15,679,356)
Total Shareholders’ Deficit   (13,228,300)   (15,678,592)
           
TOTAL LIABILITIES, CLASS A ORDINARY SHARES SUBJECT TO POSSIBLE REDEMPTION AND SHAREHOLDERS’ DEFICIT  $232,864,750   $230,881,088 

 

The accompanying notes are an integral part of these unaudited condensed financial statements.

 

1

 
 
2
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
BLUE WHALE ACQUISITION CORP I
 
CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (DEFICIT)
 
(UNAUDITED)
 
 
 
 
 
 
 
 
 
  
(1) 
Our initial shareholders initially held 5,750,000 Class B ordinary shares, up to 750,000 of which were subject to forfeiture by our sponsor depending on the extent to which the underwriters’ over- allotment option is exercised. Such shares have been capitalized into 2,548,979 Class F ordinary shares and 5,097,958 Class G ordinary shares. Pursuant to a
re-capitalization
 of our share capital effective July 5, 2021, the Class B ordinary shares have been canceled and all of the shares presently issued and outstanding are Class F ordinary shares and Class G ordinary shares (Class G ordinary shares are subject to vesting). All share and
per-share
 amounts have been retroactively restated to reflect the share capitalization and return of shares (see Notes 5 and 8)
 
 
  
(2) 
On August 18, 2021, the underwriters partially exercised the over-allotment option resulting in the issuance of an
 326,757 
Class F ordinary shares and
 653,513 
Class G ordinary shares to the Sponsor
.
 
 
 
The accompanying notes are an integral part of these unaudited condensed financial statements.

 

 

BLUE WHALE ACQUISITION CORP I

CONDENSED STATEMENTS OF OPERATIONS

(UNAUDITED)

 

           
   For the
Three Months Ended
March 31,
2022
   For the
period from
March 10, 2021
(inception) through March 31,
2021
 
Formation costs and other operating expenses  $559,957   $5,000 
           
Loss from operations   (559,957)   (5,000)
           
Other income (expense):          
Change in FV of warrant liability   3,160,249     
Change in FV of FPA   (150,000)    
           
Other income (expense), net   3,010,249     
           
Net income (loss)  $2,450,292   $(5,000)
           
Weighted average shares outstanding of Class A redeemable ordinary shares   22,940,811     
           
Basic and diluted net income (loss) per share, Class A ordinary shares  $0.10   $(0.00)
          
Weighted average shares outstanding, Class F ordinary shares non-redeemable shares   2,548,979    2,222,222 
           
Basic and diluted net income per share, Class F ordinary shares, non-redeemable shares  $0.10   $(0.00)

 

The accompanying notes are an integral part of these unaudited condensed financial statements.

 

2

 
 
3
 
 
 
 
 
 
 
 
 
 
 
 
BLUE WHALE ACQUISITION CORP I
 
CONDENSED STATEMENT

 

 

BLUE WHALE ACQUISITION CORP I

CONDENSED STATEMENTS OF CASH FLOWS

 
FOR THE PERIOD FROM MARCH CHANGES IN SHAREHOLDERS’ EQUITY (DEFICIT)

FOR THE THREE MONTHS ENDED MARCH 31, 2022 AND FOR THE PERIOD FROM MARCH 10, 2021 (INCEPTION) THROUGH SEPTEMBER 30MARCH 31, 2021 

 
(UNAUDITED)
 
 
 

(UNAUDITED)

 

                                    
  

Class F
Ordinary Shares

  

Class G
Ordinary Shares

  

Additional
Paid-in

  

Accumulated

  

Total
Shareholders’

 
  

Shares

  

Amount

  

Shares

  

Amount

   Capital   Deficit   Deficit 
Balance—January 1, 2022   2,548,979   $255    5,097,958   $509   $   $(15,679,356)  $(15,678,592)
Net income                       2,450,292    2,450,292 
Balance—March 31, 2022 (unaudited)   2,548,979   $255    5,097,958   $509   $   $(13,229,064)  $(13,228,300)

 

  

Class F
Ordinary Shares

  

Class G
Ordinary Shares

  

Additional
Paid-in

  

Accumulated

  

Total
Shareholders’

 
  

Shares

  

Amount

  

Shares

  

Amount

   Capital   Deficit   Equity 
Balance—March 10, 2021 (inception)      $       $   $   $   $ 
Issuance of Class F ordinary shares to Sponsor   2,222,222    222            24,334        24,556 
Issuance of Class G ordinary shares to Sponsor           4,444,445    444            444 
Net loss                       (5,000)   (5,000)
Balance—March 31, 2021 (unaudited)   2,222,222   $222    4,444,445   $444   $24,334   $(5,000)  $20,000 

 

The accompanying notes are an integral part of these unaudited condensed financial statements. 

 

3

 
 
4
 
 
 
 
 
 
 
 
 
 
 
 
BLUE WHALE ACQUISITION CORP I
 
NOTES TO CONDENSED FINANCIAL STATEMENTS
 
(UNAUDITED)

 

 

BLUE WHALE ACQUISITION CORP I

CONDENSED STATEMENTS OF CASH FLOWS

FOR THE THREE MONTHS ENDED MARCH 31, 2022 AND
FOR THE PERIOD FROM MARCH 10, 2021 (INCEPTION) THROUGH MARCH 31, 2021

(UNAUDITED)

 

           
   For the
Three Months Ended
March 31,
2022
   For the period
March 10, 2021
(inception) through March 31,
2021
 
Cash Flows from Operating Activities:          
Net income (loss)  $2,450,292   $(5,000)
Adjustments to reconcile net income to net cash used in operating activities:          
Change in fair value of Warrant Liability   (3,160,249)    
Change in fair value of FPA   150,000     
Changes in operating assets and liabilities:          
Prepaid expenses   207,088     
Accrued expenses   193,620     
Accounts payable – related party        5,000 
Net cash used in operating activities  $(159,249)  $ 
           
Cash Flows from Financing Activities:          
Proceeds from convertible note – related party   2,500,000     
Net cash provided by financing activities  $2,500,000   $ 
           
Net Change in Cash   2,340,751     
Cash – Beginning of period   66,156     
Cash – End of period  $2,406,907   $ 
           
Non-cash investing and financing activities:          
Deferred offering costs included in accrued offering costs  $   $142,000 
Deferred offering costs paid by Sponsor in exchange for issuance of founder shares  $   $25,000 

 

The accompanying notes are an integral part of these unaudited condensed financial statements.

 

4

 

 

BLUE WHALE ACQUISITION CORP I

NOTES TO CONDENSED FINANCIAL STATEMENTS

(UNAUDITED)

 

NOTE 1.

NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS

 
OPERATIONS
 
 OPERATIONS 

 

Blue Whale Acquisition Corp I (the “Company”) is a blank check company incorporated in the Cayman Islands on March  10, 2021. The Company was formed for the purpose of effectuating a merger, capital share exchange, asset acquisition, share purchase, reorganization or other similar business combination with one or more businesses (the “Business Combination”). The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies. 

 
As of September 30, 2021

 

As of March 31, 2022, the Company had not yet commenced any operations. All activity for the period March 10, 2021 (inception) through September 30, 2021March 31, 2022 relates to the Company’s formation and the initial public offering (the “Initial Public Offering”), which and identifying a target for a Business Combination. The Company will not generate any operating revenues until after the completion of its initial Business Combination, at is described in

Note 4. 
 
 
 
 
the earliest.

 

The registration statement for the Company’s Initial Public Offering was declared effective on August 3, 2021. On August 6, 2021 the Company consummated the Initial Public Offering of 20,000,000 units (“Units” and, with respect to Class A common shares included in the Units offered, the “Public Shares”), generating gross proceeds of $200,000,000, which is described in

Note 4. 
 
 
On August 16, 2021, the underwriters partially exercised the over-allotment option and purchased an additional 
2,940,811 Over-Allotment Units, generating an aggregate of gross proceeds of $29,408,110, incurred $588,162 in cash underwriting fees, and forfeited the remainder of the option, which over-allotment closed on August 18, 2021. Simultaneously with the closing of the exercise of the overallotment option, the Company completed the private sale (the “Private Placement”) of an aggregate of 294,081 Private Warrants (the “Private Placement Warrants”) to the Company’s Sponsor, Blue Whale Sponsor I LLC, at a purchase price of $Note 3. Simultaneously with the initial public offering, the Company’s Sponsor, Blue Whale Sponsor I LLC, purchased an aggregate of 3,000,000 Private Placement Warrants at a price of $2.00 per warrant for an aggregate purchase price of $6,000,000.

 

On August 16, 2021, Goldman Sachs & Co. LLC and BofA Securities (the “underwriters”) partially exercised the over-allotment option granted to them by the Company and purchased an additional 2,940,811 Units, generating aggregate gross proceeds of $29,408,110, received $588,162 in underwriting fees, and forfeited the remainder of the over-allotment option. The over-allotment option closed on August 18, 2021. Simultaneously with the closing of the over-allotment option, the Company completed the private placement of an aggregate of 294,081 Private Placement Warrants to the Sponsor at a purchase price of $2.00 per Private Warrant, generating gross proceeds of $588,162.

 
.

 

Following the closing of the Initial Public Offering on August 6, 2021, an amount of $200,000,000 ($ ($10.00 per Unit) from the net proceeds of the sale of the Units in the Initial Public Offering was placed in a trust account (“Trust Account”) which may be invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 185 days or less or in any open-ended investment company that holds itself out as a money market fund meeting the conditions of Rule

2a-7
 of the Investment Company Act, as determined by the Company, until the earlier of: (i) the consummation of a Business Combination or (ii) the distribution of the Trust Account to the Company’s stockholders, as described below.
 
Transaction costs amounted to $.

 

Transaction costs amounted to $13,781,960962 consisting of $ consisting of $4,588,162 of underwriting fees, $ of underwriting fees, $8,029,284 of deferred underwriting fees (

see Note 7
) and $6) and $1,164,514516 of other costs.
 
In addition, $2,406,907 of cash was held outside of the Trust Account and is available for working capital purposes.

 

The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of the Private Placement Warrants, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. Nasdaq rules provide that the Business Combination must be with one or more target businesses that together have a fair market value equal to at least 80% of the balance in the Trust Account (as defined below) (less any deferred underwriting commissions and taxes payable on interest earned on the Trust Account) at the time of the signing a definitive agreement to enter a Business Combination. The Company will only complete a Business Combination if the post-Business Combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the “Investment Company Act”). There is no assurance that the Company will be able to successfully effect a Business Combination. Upon the closing of the Initial Public Offering, management has agreed that $10.00 per Unit sold in the Initial Public Offering, including the proceeds from the sale of the Private Placement Warrants, will be held in a trust account (the “Trust Account”) and may or may not be invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act, with a maturity of 185 days or less, or in any open-ended investment company that holds itself out as a money market fund meeting the conditions of Rule

2a-7
2a-7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) the consummation of a Business Combination or (ii) the distribution of the funds in the Trust Account to the Company’s shareholders, as described below. 

 

5

 
 
5
   
 
 
 
 

 

 

The Company will provide its holders of the outstanding Public Shares (the “public shareholders”) with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a shareholder meeting called to approve the Business Combination or (ii) by means of a tender offer. In connection with a proposed Business Combination, the Company may seek shareholder approval of a Business Combination at a meeting called for such purpose at which shareholders may seek to redeem their shares, regardless of whether they vote for or against a Business Combination. The Company will proceed with a Business Combination only if the Company has net tangible assets of at least $5,000,001 either immediately prior to or upon such consummation of a Business Combination and, if the Company seeks shareholder approval, a majority of the outstanding shares voted are voted in favor of the Business Combination. 

 

 

Notwithstanding the foregoing, if the Company seeks shareholder approval of a Business Combination and it does not conduct redemptions pursuant to the tender offer rules, the Company’s Certificate of Incorporation provides that, a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from seeking redemption rights with respect to 15% or more of the Public Shares without the Company’s prior written consent. 

 

 

The public shareholders will be entitled to redeem their shares for a pro rata portion of the amount then in the Trust Account (initially $10.00 

 per share, plus any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations). The per-share amount to be distributed to shareholders who redeem their shares will not be reduced by the deferred underwriting commissions the Company will pay to the underwritersunderwriter (as discussed in
Note 7
Note 7). There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s warrants. These shares of Class  A ordinary shares are recorded at a redemption value and classified as temporary equity after the completion of the Initial Public Offering, in accordance with Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” 

 

If a shareholder vote is not required and the Company does not decide to hold a shareholder vote for business or other legal reasons, the Company will, pursuant to its Certificate of Incorporation, offer such redemption pursuant to the tender offer rules of the Securities and Exchange Commission (the “SEC”), and file tender offer documents containing substantially the same information as would be included in a proxy statement with the SEC prior to completing a Business Combination.  

 

The Company’s Sponsor has agreed (a) to vote its Founder Shares (as defined in

Note 6
Note 5) and any Public Shares purchased during or after the Initial Public Offering in favor of a Business Combination, (b) not to propose an amendment to the Company’s Certificate of Incorporation with respect to the Company’s
pre-Business
Combination activities prior to the consummation of a Business Combination unless the Company provides dissenting public shareholders with the opportunity to redeem their Public Shares in conjunction with any such amendment; (c) not to redeem any shares (including the Founder Shares) into the right to receive cash from the Trust Account in connection with a shareholder vote to approve a Business Combination (or to sell any shares in a tender offer in connection with a Business Combination if the Company does not seek shareholder approval in connection therewith) or a vote to amend the provisions of the Amended and Restated Certificate of Incorporation relating to shareholders’ rights of
pre-Business
Combination activity and (d) that the Founder Shares shall not participate in any liquidating distributions upon winding up if a Business Combination is not consummated. However, the Sponsor will be entitled to liquidating distributions from the Trust Account with respect to any Public Shares purchased during or after the Initial Public Offering if the Company fails to complete its Business Combination.  

 

The Company will have until August 6, 2023 to consummate a Business Combination (the “Combination Period”). If the Company is unable to complete a Business Combination within 24 months from the closing of the Initial Public Offering (the “Combination Period”), the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but no more than ten business days thereafter, redeem the public shares, at a

per-share
per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned on the funds held in the Trust Account and not previously released to us to pay  
 
  
6
   
 
 
 
 
 
 
 
 
 
taxes (less up to $100,000 
taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public Shareholder’s rights as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii)  as promptly as reasonably possible following such redemption, subject to the approval of the remaining shareholders and the Company’s board of directors, proceed to commence a voluntary liquidation and thereby a formal dissolution of the Company, subject in each case to its obligations under Cayman Islands law to provide for claims of creditors and the requirements of applicable law. The underwriters have agreed to waive their rights to the deferred underwriting commission held in the Trust Account in the event the Company does not complete a Business Combination within the Combination Period and, in such event, such amounts will be included with the funds held in the Trust Account that will be available to fund the redemption of the Public Shares. In the event of such distribution, it is possible that the per share value of the assets remaining available for distribution will be less than the Initial Public Offering price per Unit 
$ $10.00.
 
.

 

6

 

 

The Sponsor has agreed to waive its rights to liquidating distributions from the

 
 Trust Account with respect to the Founder Shares and Private Placement Shares it will receive if the Company fails to complete a Business Combination within the Combination Period. However, if the Sponsor or any of its respective affiliates acquire Public Shares, such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination within the Combination Period. The underwriters have agreed to waive their rights to their deferred underwriting commission (see Note
7
6) held in the Trust Account in the event the Company does not complete a Business Combination within the Combination Period, and in such event, such amounts will be included with the other funds held in the Trust Account that will be available to fund the redemption of the Public Shares. In the event of such distribution, it is possible that the per share value of the assets
 
 remaining available for distribution will be less than the Proposed Public Offering price per share ($10.0010.00). 
 

 

In order to protect the amounts held in the trust, the Sponsor has agreed that it will be liable to the Company if and to the extent any claims by a third party for services rendered or products sold to the Company, or a prospective target business with which the Company has entered into a written letter of intent, confidentiality or similar agreement or Business Combination agreement, reduce the amount of funds in the Trust Account to below the lesser of (i) $10.00 per Public Share and (ii) the actual amount per Public Share held in the Trust Account as of the day of liquidation of the Trust Account, if less than $10.0010.00 per share due to reductions in the value of the trust assets, less taxes payable; provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to monies held in the Trust Account (whether or not such waiver is enforceable) nor will it apply to any claims under the Company’s indemnity of the underwritersunderwriter of the Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). However, the Company has not asked the Sponsor to reserve for such indemnification obligations, nor has the Company independently verified whether the Sponsor has sufficient funds to satisfy its indemnity obligations and believe that the Sponsor’s only assets are securities of the Company. Therefore, the Company cannot assure its shareholders that the Sponsor would be able to satisfy those obligations. None of the Company’s officers or directors will indemnify the Company for claims by third parties including, without limitation, claims by vendors and prospective target businesses. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers, prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account. 

 
  
Risks and Uncertainties
 
Management is currently evaluating the impact of the
COVID-19

 

Risks and Uncertainties

 

In February 2022, the Russian Federation and Belarus commenced military operations in Ukraine. As a result of this action, various nations, including the United States, have instituted economic sanctions against the Russian Federation and Belarus. The impact of this action and related sanctions on the global economy are not determinable as of the date of these financial statements and the specific impact on the Company’s financial condition, results of operations, and cash flows is also not determinable as of the date of these financial statements.

 

Management is currently evaluating the impact of the COVID-19 pandemic on the industryindustries in which a Business Combination target is sought and has preliminarily concluded that, while it is reasonably possible that the virusCOVID-19 pandemic could have a negative effect on the Company’s financial position, results of its operations and/or search for a target company, the specific impact is not readily determinable as of the date of these financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. 

 
 

 

7

 

 

NOTE 2. RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENT
 
In connection with the preparation of the Company’s condensed financial statements as of September 30, 2021 and in accordance with the SEC and its staff’s guidance on redeemable equity instruments, ASC 480, paragraph 10-S99, redemption provisions not solely within the control of the Company would require ordinary shares subject to redemption to be classified outside of permanent equity. Accordingly, management determined it should restate its previously reported balance sheet as of August 6, 2021 (the “Affected Period”). The Company had previously determined the shares of Class A ordinary shares subject to possible redemption to be equal to the redemption value of
 $
10.00
 
per share of Class A ordinary share while also taking into consideration that a redemption cannot result in net tangible assets being less than
 $
5,000,001
.
Effective with these condensed consolidated financial statements, all Class A ordinary shares subject to possible redemption are classified as temporary equity in its entirety.
 
In accordance with SEC Staff Accounting Bulletin No. 99, “Materiality,” and SEC Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements,” the Company evaluated the corrections and has determined that the related impact was material to the previously filed financial statement that contained the error, reported in the Company’s Form 8-K as of August 6, 2021. Therefore, the Company, in consultation with its Audit Committee, concluded that the Affected Period should be restated to present all Class A ordinary shares subject to possible redemption as temporary equity and to recognize accretion from the initial book value to redemption value at the time of its Initial Public Offering. As such, the Company is reporting those periods in this quarterly report.
 
The impact of the restatement on the financial statements for the Affected Period is presented below.
 
 
 
The table below present the effect of the adjustments related to the restatement discussed above of the Company’s previously reported balance sheet as of August 6, 2021:
 
 
 
 
 
 
 
 
 
7
 
 
 
 
 
 
 
 
 
 
 
NOTE 3. SUMMARY OF SIGNIFICANT ACCOUNTING
 
POLICIES
 
 

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 

 

Basis of Presentation
 

Basis of Presentation

 

The accompanying balance sheet is presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the

SEC.
 SEC.

 

Liquidity and

Liquidity, Capital Resources

 
As of September 30and going Concern

 

As of March 31, 20212022, the Company had approximately $$229,413408,110  cash held in the Trust Account and $, and $3722,788406,907  held outside of the Trust Account. Prior to the completion of the Initial Public Offering, the Company’s liquidity needs hadhas been satisfied through a payment of certain offering costs of $25,000  from the Sponsor (see Note 6) for the Founder Shares, and the loan under an unsecured promissory note from the Sponsor of $300,000 (see Note 6 (see Note 5). The Company’s Sponsor has undertaken to fund working capital deficiencies of the Company and finance transaction costs in connection with an initial Business Combination of the Company by means of Company working capital loans, as defined below (see Note 5). As of September 30On February 22, 20212022, the Company has not drawn on the Note. Subsequent to the consummation of the Initial Public Offering and Private Placement, the Company’s liquidity needs have been satisfied from the proceeds from the Initial Public Offering and Private Placement not held in the Trust Account.

 
During the interim period ended September 30, 2021, the Company has sustained negative cash flows from operations and
 
expects
 
to continue to incur negative cash flows from operations for at least the next twelve months from the
 
filing of this report. Consequently,drew down and received cash proceeds of $2.5 million from the Sponsor under the Working Capital Loan arrangement. Accordingly, management has determined that sufficient capital exists to sustain operations one year from the date of this filing and the substantial doubt about the Company’s ability to continue as a going concern existed as of September 30, 2021.
 
In addition, in order to finance transaction costs in connection with a Business Combination, the Company’s Sponsor or an affiliate of the Sponsor or certain of the Company’s officers and directors may  provide the Company Working Capital Loans, as defined below (see Note 6).
 
On 
November
 
22, 2021 the Sponsor confirmed to the Company that it will provide any such Working Capital Loans for at least the next twelve months.
 
As of September 30, 2021, there were no amounts outstanding under any Working Capital Loan.
 
Based on the foregoing, management believes that the Company will have sufficient working capital to meet its needs through the earlier of the consummation of a Business Combination or one year from this filing. Over this time period, the Company will be using these funds for paying existing accounts payable, operating costs, identifying and evaluating prospective Initial Business Combination candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to merge with or acquire, and structuring, negotiating and consummating the Business Combination.
 has been alleviated.

 

Emerging Growth Company
  

Emerging Growth Company 

 

The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. 

 

 

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to

non-emerging
growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company, which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. 
 
 

 

Use of Estimates
 

Use of Estimates 

 

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. 

 

 

Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates. 

 

 

Cash held in Trust Account

8

At September 30, 2021, the assets held in the Trust Account were held in money market funds, which are invested primarily in U.S. Treasury Securities.
 

 

 

Cash and Cash Equivalents
 

Cash

 

The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company had $3722,788 in cash and 406,907 and $66,156 in cash and no cash equivalents as of September 30March 31, 2022 and December 31, 2021.

 
 
  
 
 
 
8
 
  
 
 
 
 
 
 
 
 
 
Income Taxes
 
, respectively.

 

Cash held in Trust Account 

 

At March 31, 2022 and December 31, 2021, all of the assets held in the Trust Account were held in non-interest bearing cash accounts.

 

Income Taxes 

 

The Company complies with the accounting and reporting requirements of ASC Topic 740, “Income Taxes,” which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred income tax assets and liabilities are computed for differences between the financial statements and tax bases of assets and liabilities that will result in future taxable or deductible amounts, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.  

 

ASC Topic 740 prescribes a recognition threshold and a measurement attribute for the

 
 financial statements recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be
more-likely-than-not
to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits, if any, as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of September 30, 2021March 31, 2022. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.  

 

There is currently no taxation imposed on income by the Government of the Cayman Islands. In accordance with Cayman income tax regulations, income taxes are not levied on the Company. Consequently, income taxes are not reflected in the Company’s financial statements. The Company’s management does not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months.  

 

Shares Subject to Possible Redemption

 

The Company accounts for its Class A ordinary shares subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Class A ordinary shares subject to mandatory redemption are classified as a liability instrument and are measured at fair value. Conditionally redeemable ordinary shares (including ordinary shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) are classified as temporary equity. At all other times, ordinary shares are classified as shareholders’ equity. The Company’s ordinary shares feature certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at March 31, 2022 and December 31, 2021, 22,940,811 Class A ordinary shares subject to possible redemption are presented as temporary equity, outside of the shareholders’ equity section of the Company’s balance sheet.

 

As of March 31, 2022 and December 31, 2021, the ordinary share reflected on the balance sheet are reconciled in the following table:

 

     
Gross Proceeds  $229,408,110 
Less:     
Proceeds allocated to public warrants   (6,236,666)
Class A ordinary shares issuance costs   (13,396,055)
Add:     
Accretion   19,632,721 
Class A ordinary shares subject to possible redemption  $229,408,110 

 

Fair Value of Financial Instruments
 

9

 

 

Offering Costs

 

Offering costs consist of legal, accounting, underwriting fees and other costs incurred through the balance sheet date that are directly related to the Initial Public Offering. Offering costs amounting to $13,781,962 were charged to shareholders’ equity or operations upon the completion of the Initial Public Offering.

 

Share Based Compensation

 

The transfer of the Founder Shares (see Note 5) is in the scope of FASB ASC Topic 718, “Compensation-Stock Compensation” (“ASC 718”). Under ASC 718, share-based compensation associated with equity-classified awards is measured at fair value upon the grant date. The Founders Shares were granted subject to a performance condition (i.e., the occurrence of a Business Combination). Share-based compensation would be recognized at the date a Business Combination is considered probable (i.e., upon occurrence of a Business Combination) in an amount equal to the number of Founders Shares that ultimately vest multiplied by the grant date fair value per share (unless subsequently modified) less the amount initially received for the purchase of the Founders Shares. As of December 31, 2021, the Company determined that a Business Combination is not considered probable, and, therefore, no share-based compensation expense has been recognized.

 

The fair value at the grant date of the 125,000 shares transferred to the Company’s directors was $222,780 or $ 1.78 per share. Upon consummation of an initial business combination, the Company will recognize $222,780 in compensation expense.

 

Basic income per ordinary share is computed by dividing net income applicable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Consistent with FASB 480, ordinary shares subject to possible redemption, as well as their pro rata share of undistributed trust earnings consistent with the two-class method, have been excluded from the calculation of income per ordinary share for the three months ended March 31, 2022 and for the period from March 10, 2021 (inception) to March 31, 2021. Such shares, if redeemed, only participate in their pro rata share of trust earnings. Diluted income per share includes the incremental number of ordinary shares to be issued to settle warrants, as calculated using the treasury method. For the three months ended March 31, 2022 and the period from March 10, 2021 (inception) to March 31, 2021, the Company did not have any dilutive warrants, securities or other contracts that could potentially, be exercised or converted into ordinary shares. As a result, diluted income per ordinary share is the same as basic income per ordinary share for all periods presented.

 

A reconciliation of net income per ordinary share is as follows:

 

                    
  

For the
Three Months Ended
March 31,
2022

   For the period from
March 10, 2021
(inception) through
March 31,
2021
 
    Class A    Class F    Class A    Class F 
Basic and diluted net income (loss) per common stock                    
Numerator:                    
Allocation of net income (loss), as adjusted  $2,205,263   $245,029   $   $(5,000)
Denominator:                    
Basic and diluted weighted average shares outstanding   22,940,811    2,548,979        2,222,222 
Basic and diluted net income (loss) per common stock  $0.10   $0.10   $(0.00)  $(0.00)

 

Concentration of Credit Risk

 

Financial instruments that potentially subject the Company to concentration of credit risk consist of a cash account in a financial institution which, at times may exceed the Federal Depository Insurance Corporation coverage limit of $250,000. The Company has not experienced losses on this account and management believes the Company is not exposed to significant risks on such account.

 

10

 

 

Fair Value of Financial Instruments 

 

The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying balance sheet, primarily due to their short-term nature.  

Offering Costs
 
Offering costs consist of legal, accounting, underwriting fees

 

Derivative Financial Instruments

 

The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, “Derivatives and other costs incurred through the Initial Public OfferingHedging”. For derivative financial instruments that are directly related toaccounted for as liabilities, the Initial Public Offering. Offering costsderivative instrument is initially recorded at its fair value on the grant date and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The classification amounting to $12,164,514 

were charged to temporaryof derivative instruments, including whether such instruments should be recorded as liabilities or as equity, shareholders’ deficit or operations uponis evaluated at the end of each reporting period. Derivative liabilities are classified in the balance sheet as current or non-current based the completionon whether or not net-cash settlement or conversion of the Initial Public Offering.
 
 
instrument could be required within 12 months of the balance sheet date.

 

 

Recently Issued Accounting Standards 

 
Management does not believe that any 

 

In August 2020, 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 for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impact this guidance will have on its financial statements.

 

Management does not believe that any other recently issued, but not yet effective, accounting pronouncementsstandards, if currently adopted, would have a material impacteffect on the balance sheet.

 
NOTE 4. INITIAL PUBLIC OFFERING 
 
 
our financial statements.

 

NOTE 3. INITIAL PUBLIC OFFERING 

 

Pursuant to the Initial Public Offering, the Company sold 20,000,000 Units at a purchase price of $10.00 per Unit. Each Unit will consist of one Class A ordinary share, $0.0001 par value, and

one-fourth
one-fourth of one redeemable warrant (“Public Warrant”). Each whole Public Warrant will entitle the holder to purchase one Class A ordinary share at an exercise price of $11.50 per whole share
(see Note 9
7).  

 

On August 16, 2021, the underwriters partially exercised the over-allotment option and purchased an additional  2,940,811 Over-Allotment Units, generating an aggregate of gross proceeds of $29,408,110, incurred $received $588,162 in underwriting fees in cash underwriting fees, and forfeited the remainder of the over-allotment option,. whichThe over-allotment closed on August  18, 2021.  

 

NOTE 5. PRIVATE PLACEMENT 
 
 

NOTE 4. PRIVATE PLACEMENT

 

Simultaneously with the initial public offering, the Sponsor purchased an aggregate of 3,000,000 Private Placement Warrants at a price of $2.00 per warrant for an aggregate purchase price of $6,000,000. Simultaneously with the closing of the exercise of the overallotment option, the Company completed the private sale of an additional 294,081 Private Placement Warrants to the Company’s Sponsor, Blue Whale Sponsor I LLC, at a purchase price of $ at a purchase price of $2.00 per Private Warrant, generating gross proceeds of $588,162.

 
 
 
9
   
 
 
 
 
 
 
  
.

 

Each Private Placement Warrant is identical to the warrants offered in the Initial Public Offering, except there will be no redemption rights or liquidating distributions from the trust account with respect to Private Placement Warrants, which will expire worthless if we do not consummate a Business Combination within the Combination Period. 

 

 

11

 

 
 

 

NOTE 6. RELATED PARTY TRANSACTIONS 
 
 
Founder Shares
 
On March 

NOTE 5. RELATED PARTY TRANSACTIONS

 

Founder Shares

 

On March 11, 2021, the Company issued an aggregate of 5,750,000 shares of Class B ordinary shares (the “Founder Shares”) to the Sponsor for an aggregate purchase price of $25,000. The Founder Shares include an aggregate of up to 750,000 

 shares subject to forfeiture by the Sponsor to the extent that the underwritersunderwriters over-allotment is not exercised in full or in part. Such shares have been recapitalized into  2,548,979 Class F ordinary shares and 5,097,958 Class G ordinary shares (which we respectively refer to as “Class F founder shares” and “Class G founder shares,” and collectively refer to as “founder shares” as further described herein). Pursuant to a
re-organization
of the Company’s share capital effective July  5, 2021, the Class B ordinary shares have been canceled and all of the shares presently issued and outstanding are Class F ordinary shares and Class G ordinary shares. (See
Note 9
)
.
 
note 8).

 

On August 18, 2021, the underwriters partially exercised the over-allotment option resulting in the issuance of an additional  326,757 

Class F ordinary shares and
  Class F ordinary shares and 653,513 
Class G ordinary shares to the Sponsor. 
 
 Class G ordinary shares to the Sponsor. On September 17, 2021, the remaining balance of the over-allotment option expired unexercised and was therefore forfeited.

 

The Sponsor has agreed not to transfer, assign or sell any of its Founder Shares until two years after the completion of a Business Combination.  

Promissory Note—

 

Promissory Note - Related Party  

On March 

 

On March 11, 2021, the Sponsor agreed to loan the Company an aggregate of up to $300,000 to cover expenses related to the Initial Public Offering pursuant to a promissory note (the “Note”). The Note is

non-interest
bearing and is payable on the earlier of (i) March 11December 31, 2022 or (ii) the consummation ofdate the Proposed Public OfferingCompany completes its initial Business Combination. As of September 30, 2021, the Company has March 31, 2022 and December 31, 2021, the Company has $not drawn156,384 outstanding on the Note.  
Related Party Loans
 
, which is classified as current on our Balance Sheet.

 

Related Party Loans

 

In order to finance transaction costs in connection with a Business Combination, the Company’s Sponsor, an affiliate of the Sponsor, or the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (the “Working Capital Loans”). Such Working Capital Loans would be evidenced by promissory notes. On February 16, 2022, the Sponsor confirmed to the Company that it will provide any such Working Capital Loans for at least the next twelve months, pursuant to a promissory note. The notes would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $2,500,000 of notes may be converted upon consummation of a Business Combination into warrants at a price of $2.00 per warrant. The warrants will be identical to the Private Placement Warrants. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans.  

Administrative Support Agreement
 
The Company entered into an agreement,

 

On February 16, 2022, the Company entered into a promissory note with the Sponsor pursuant to which the Sponsor agreed to loan the Company up to an aggregate principal amount of $2,500,000 which the Company drew down in full on February 22, 2022. This note is non-interest bearing and is due on the earlier of the day by which the Company must complete a Business Combination, and the effective date of a Business Combination. The outstanding balance under this loan amounted to $2,500,000 as of March 31, 2022. Management determined that there was an embedded conversion feature related to the note that would require bifurcation and be classified as a liability. However, based on a third-party valuation, the amount was determined to be de minimis.

 

In addition, our Sponsor, officers and directors, or our respective affiliates will be reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable Business Combinations. Our audit committee will review on a quarterly basis all payments that were made by us to our Sponsor, executive officers or directors, or our affiliates. Any such payments prior to an initial Business Combination will be made using funds held outside the Trust Account. There was $325,000 due to related party at March 31, 2022 and December 31, 2021.

 

12

 

 

Administrative Support Agreement

 

The Company entered into an agreement whereby, commencing on August 6, 2021, throughand continuing until the earlier of the consummation of a Business Combination or the Company’s liquidation, the Company may reimburse an affiliate of the Sponsor up to an amount of $10,000 per month for office space and secretarial and administrative support. 

 
 
 
10
   
 
 
 
 
 
 
 
 
 
NOTE 7.

 

NOTE 6. COMMITMENTS AND CONTINGENCIES   

Registration Rights
 
 

 

Registration Rights

 

The holders of the Founder Shares, Private Placement Warrants and any warrants that may be issued upon conversion of the Working Capital Loans (and in each case holders of their component securities, as applicable) will be entitled to registration rights pursuant to a registration rights agreement to be signed prior to or on the effective date of the Initial Public Offering, requiring the Company to register such securities for resale (in the case of the Founder Shares, only after conversion to our Class A ordinary shares). The holders of the majority of these securities are entitled to make up to three demands, excluding short form demands, that the Company register such securities. In

 
 addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the consummation of a Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. The Company will bear the expenses incurred in connection with the filing of any such registration statements.  
Underwriting Agreement
 
 
 
The Company granted the underwriters a 
45-day
 option to purchase up to 3,000,000 additional Units to cover over-allotments at the Initial Public Offering price, less the underwriting discounts and commissions.
 
The

 

Underwriting Agreement

 

Pursuant to the Underwriting Agreement, the underwriters were paid a cash underwriting discount of  2.00% of the gross proceeds of the Initial Public Offering, or $4,000488,000162.

. In addition, the underwriters will be entitled to a deferred fee of three and half percent ( (3.50%) of the gross proceeds of the Initial Public Offering, or $78,000029,000284. On August  16, 2021, the Underwriters partially exercised the over-allotment option and purchased an additional 2,940,811 Over-Allotment Units, generating an aggregate of gross proceeds of $29,408,110, incurred $, incurred $588,162 in cash underwriting fees and $1,029,284 
 in deferred underwriters’ fees, and forfeited the remainder of the option, which over-allotment closed on August 18, 2021. The deferred fee was placed in the Trust Account and will be paid in cash upon the closing of a Business Combination, subject to the terms of the underwriting agreement. 
Forward Purchase Agreement
 

 

Forward Purchase Agreement

 

The Company entered into a forward purchase agreement that will provide for the purchase by it of up to an aggregate of 5,000,000 units for an aggregate purchase price of up to $50,000,000, or $, or $10.00 per unit, in a private placement to close substantially concurrently with the closing of our initial business combination. The forward purchase investor will determine in its sole discretion the specific number of forward purchase units it will purchase, if any, pursuant to the forward purchase agreement. Each forward purchase unit will consist of one Class  A ordinary share and

one-
one- fourth of one redeemable warrant.
. The terms of the forward purchase units will generally be identical to the terms of the units being issued in this offering, except that the securities underlying the forward purchase units will be subject to certain registration rights.  

 

Consistent with the warrant liability discussed in Note 109, the Company will account for the FPA in accordance with the guidance contained in ASC

815-40.
815-40. Such guidance provides that because the FPA units do not meet the criteria for equity treatment thereunder, each unit must be recorded as a liability. Accordingly, the Company will classify the FPA as an asseta liability at its fair value. This assetliability is subject to
re-measurement
at each balance sheet date. With each such remeasurement, the FPA asset will beliability is adjusted to fair value, with the change in fair value recognized in the Company’s statement of operations.  

 

NOTE 8.

NOTE 7. CLASS A ORDINARY SHARES SUBJECT TO POSSIBLE REDEMPTION 

 
 

 

The Company’s Class A ordinary shares feature certain redemption rights that are considered to be outside of the Company’s control and subject to the occurrence of future events. The Company is authorized to issue  500,000,000 shares of Class A ordinary shares with a par value $ shares of Class A ordinary shares with a par value $0.0001 per share.  per share. Holders of the Company’s Class A ordinary shares are entitled to one  one vote for each share. As of September 30, 2021, there were March 31, 2022 and December 31, 2021, there were 22,940,811  Class A ordinary shares outstanding, respectively, which were subject to possible redemption and are classified outside of permanent equity in the condensed balance sheets. 

 

 

13

11
   
 
 
 
 

 

 

NOTE 9. SHAREHOLDER’S DEFICIT 
 
 
Preferred Shares
—The Company is authorized to issue

NOTE 8. SHAREHOLDER’S DEFICIT

 

Preferred Shares—The Company is authorized to issue 5,000,000 shares of $ shares of $0.0001 par value preferred shares. At September 30, 2021, there were March 31, 2022 and December 31, 2021, there were no preferred shares issued or outstanding.

 
Founder shares
The Company is authorized to issue up to 30,000,000 class F ordinary shares, $, respectively.

 

Class A Ordinary shares—The Company is authorized to issue up to 500,000,000 shares of Class A, $0.0001 par value ordinary shares. Holders of the Company’s ordinary shares are entitled to one vote for each share. At March 31, 2022 and December 31, 2021, there were no Class A ordinary shares issued or outstanding, respectively.

 

Founder sharesThe Company is authorized to issue up to 30,000,000 class F ordinary shares, $0.0001 par value and  par value and 30,000,000 class G ordinary shares, $ class G ordinary shares, $0.0001 par value, out of which we have issued  par value, out of which we have issued 2,548,979 Class F ordinary shares and  Class F ordinary shares and 5,097,958 Class G ordinary shares. Holders of the Company’s ordinary shares are entitled to one vote for each share. At September 30, 2021, there were March 31, 2022 and December 31, 2021, there were 2,548,979 and  Class F and 5,097,958 Class F and Class G ordinary shares issued and outstanding,

  respectively. (
See Note 6
)
.
 
(see note 5).

 

Shareholders of record are entitled to one vote for each share held (on an

as-converted
to Class A ordinary share basis) on all matters to be voted on by shareholders. Prior to our initial business combination, only holders of our Class F ordinary shares will have the right to vote on the appointment of directors. Holders of our Class G ordinary shares and public shares will not be entitled to vote on the appointment of directors during such time. 
 

 

The Class F founder shares will automatically convert into Class A ordinary shares on the first business day following the closing of our initial business combination, at a ratio such that the number of Class A ordinary shares issuable upon conversion of all Class F founder shares will equal, in the aggregate on an as converted basis, 10% of the sum of (i) the total number of all Class A ordinary shares issued and outstanding upon completion of this offering (including any over-allotment shares if the underwriters exercise their over-allotment option and without giving effect to any redemptions of any public shares in connection with the initial business combination), plus (ii) the total number of Class A ordinary shares issued or deemed issued or issuable upon conversion of the Class F founder shares, plus (iii) unless waived by our sponsor, the total number of Class A ordinary shares or equity- linked securities exercisable for or convertible into Class A ordinary shares issued, deemed issued, or to be issued, in connection with or in relation to the consummation of the initial business combination, including any forward purchase shares, and excluding (x) any Class A ordinary shares or equity-linked securities exercisable for or convertible into Class A ordinary shares issued, deemed issued, or to be issued, to any seller in the initial business combination and (y) any Class A ordinary shares issuable upon conversion of the Class G founder shares. Prior to our initial business combination, only holders of our Class F ordinary shares will be entitled to vote on the appointment of directors

.
 
.

 

The Class G founder shares will convert into Class A ordinary shares after our initial business combination only to the extent certain triggering events occur prior to the applicable anniversary of our initial business combination including three triggering events based on our shares trading at

$$15.00, $, $20.00 and $ and $25.00 
 per share following the closing of our initial business combination and also upon specified strategic transactions, in each
 case, as described in the Company’s finalthis prospectus filed with the SEC on August 4, 2021 (the “Prospectus”). The Class  G founder shares will be convertible into Class  A ordinary shares at a ratio such that the number of Class  A ordinary shares issuable upon conversion of all founder shares (including both Class  F founder shares and Class  G founder shares) would equal, in the aggregate on an as-converted basis,  15%, %, 20% and % and 25%
% (based on varying triggers as discussed in more detail in the Prospectusthis prospectus) of the sum of (i)  the total number of all Class  A ordinary shares issued and outstanding upon completion of this offering (including any over-allotment shares if the underwriters exercise their over-allotment option and without giving effect
 to any redemptions of any public shares in connection with the initial business combination), plus (ii)  the total number of Class  A ordinary shares issued or deemed issued or issuable upon conversion of the Class  F founder shares and Class  G founder shares, plus (iii)  unless waived by our Sponsorsponsor, the total number of Class  A ordinary shares or equity-linked securities exercisable for or convertible into Class  A ordinary shares issued, deemed issued, or 
to be issued, in connection with or in relation to the consummation of the initial business combination, including any forward purchase shares and excluding any Class  A ordinary shares or equity-linked securities exercisable for or convertible into Class  A ordinary shares issued, deemed issued, or to be issued, to any seller in the initial business combination.
 
 
 
12
   
 
 
 
 
 
 
 
 
 

 

The Class G ordinary shares were granted subject to a performance condition (i.e., the occurrence of a Business Combination), as well as various market conditions (i.e., stock price targets after consummation of the Business Combination). The various market conditions are considered in determining the grant date fair value of these instruments using Monte Carlo simulation. Compensation expense related to

the
the Class G ordinary shares is recognized only when the performance condition is probable of occurrence.
 
 

 

14

 

 

 

NOTE 10.

NOTE 9. WARRANT LIABILITIES

 
The Company accounts for

 

The Company accounts for 89,294029,081283 warrants— warrants - 5,000735,000202 Public Warrants and the  Public Warrants and the 3,294,081 Private

 
 Placement Warrants - issued in connection with the Proposed Public Offering in accordance with the guidance contained in ASC
815-40.
815-40. Such guidance provides that because the warrants do not meet the criteria for equity treatment thereunder, each warrant must be recorded as a liability. Accordingly, the Company will classify each warrant as a liability at its fair value. This liability is subject to
re-measurement
at each balance sheet date. With each such remeasurement, the warrant liability will be adjusted to fair value, with the change in fair value recognized in the Company’s statement of operations. 
 
Warrants

 

Warrants—Public Warrants may only be exercised for a whole number of shares. No fractional shares will be issued upon exercise of the Public Warrants. The Public Warrants will become exercisable 30 days after the consummation of a Business Combination. The Public Warrants will expire five yearsfive years from the consummation of a Business Combination or earlier upon redemption or liquidation. 

 

 

The Company will not be obligated to deliver any Class A ordinary shares pursuant to the exercise of a Public Warrant and will have no obligation to settle such Public Warrant exercise unless a registration statement under the Securities Act covering the issuance of the Class A ordinary shares issuable upon exercise of the Public Warrants is then effective and a prospectus relating thereto is current, subject to the Company satisfying its obligations with respect to registration. No Public Warrant will be exercisable for cash or on a cashless basis, and the Company will not be obligated to issue any shares to holders seeking to exercise their Public Warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption from registration is available. 

 

 

The Company has agreed that as soon as practicable, but in no event later than 15 business days, after the closing of a Business Combination, it will use its best efforts to file with the SEC a registration statement registering the issuance, under the Securities Act, of the Class A ordinary shares issuable upon exercise of the Public Warrants. The Company will use its best efforts to file with the SEC a registration statement covering the shares of Class A ordinary shares issuable upon exercise of the warrants, to cause such registration statement to become effective and to maintain a current prospectus relating to those shares of Class A ordinary shares until the warrants expire or are redeemed, as specified in the warrant agreement. If a registration statement covering the shares of Class A ordinary shares issuable upon exercise of the warrants is not effective by the 60th business day after the closing of a Business Combination, warrant holders may, until such time as there is an effective registration statement and during any period when the Company will have failed to maintain an effective registration statement, exercise warrants on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act or another exemption. 

 
Redemption of warrants when the price per Class

 

Redemption of warrants when the price per Class A ordinary share equals or exceeds $18.00

.
. Once the warrants become exercisable, the Company may redeem the Warrants for redemption: 
 
 

 

 
   
in whole and not in part; 
 
 
 
 

 

 
   
at a price of $0.01 per Public Warrant; 
 
 
 
 

 

 
   
upon not less than 30 days’ prior written notice of redemption to each warrant holder and 
 
 
 
 

 

 
   
if, and only if, the reported last sale price of the Class A ordinary shares equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described) for any 20 trading days within a
30-trading
day period ending three business days before the Company sends the notice of redemption to the warrant holders. 
 
 
 

 

The Company will not redeem the warrants as described above unless an effective registration statement under the Securities Act covering the issuance of the Class A ordinary shares issuable upon exercise of the warrants is then effective and a current prospectus relating to those Class A ordinary shares is available throughout the

30-day
30-day redemption period. If and when the warrants become redeemable by us, the Company may exercise its redemption right even if the Company is unable to register or qualify the underlying securities for sale under all applicable state securities laws. 

 

15

 
 
13
   
 
 
 
 
Redemption of warrants when the price per Class

 

 

Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00

.
. Once the Warrants become exercisable, the Company may redeem the Warrants for redemption: 
 
 

 

 
   
in whole and not in part; 
 
 
 
 

 

 
   
at $at $0.10 per warrant upon a minimum of  per warrant upon a minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by reference to the table based on the redemption date and the “fair market value” of our Class A ordinary shares; 
 
 
 
 

 

 
   
if, and only if, the Reference Value (as defined above under “Redemption of warrants when the price per Class A ordinary share equals or exceeds $18.00”) equals or exceeds $10.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant); and 
 
 
 
 

 

 
   
if the Reference Value is less than $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant), the private placement warrants must also concurrently be called for redemption on the same terms as the outstanding public warrants, as described above. 
 
 
 

 

If and when the Public Warrants become redeemable by the Company, the Company may not exercise its redemption right if the issuance of shares of ordinary shares upon exercise of the warrants is not exempt from registration or qualification under applicable state blue sky laws or the Company is unable to effect such registration or qualification. 

 

 

The exercise price and number of shares of Class A ordinary shares issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a share dividend, or recapitalization, reorganization, merger or consolidation. Additionally, in no event will the Company be required to net cash settle the Public Warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with the respect to such warrants. Accordingly, the warrants may expire worthless. If the Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of shares of ordinary shares issuable upon exercise of the Public Warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend or recapitalization, reorganization, merger or consolidation. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with respect to such warrants. Accordingly, the warrants may expire worthless. 

 

 

In addition, if (x) the Company issues additional shares of Class A ordinary shares or equity- linked securities for capital raising purposes in connection with the closing of its initial Business Combination at an issue price or effective issue price of less than $9.20 per share of Class A ordinary shares (with such issue price or effective issue price to be determined in good faith by the Company’s board of directors and, in the case of any such issuance to the Sponsor or its affiliates, without taking into account any Founder Shares held by the Sponsor or such affiliates, as applicable, prior to such issuance) (the “Newly Issued Price”), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of the Company’s initial Business Combination on the date of the consummation of such initial Business Combination (net of redemptions), and (z) the volume weighted average trading price of the Company’s ordinary shares during the 20 trading day period starting on the trading day prior to the day on which the Company consummates its initial Business Combination (such price, the “Market Value”) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price and the $18.00 per share redemption trigger price described above will be adjusted (to the nearest cent) to be equal to 180% of the greater of the Market Value and the Newly Issued Price. 

  
 
 
14
 
  
 
 
 
 
 
 
 
 
 
  
The
 
Private Placement Warrants will be identical to the Public Warrants included in
the

 

The Private Placement Warrants will be identical to the Public Warrants included in the Units being sold in the Initial Public Offering, except that the Private Placement Warrants will and the shares of ordinary shares issuable upon the exercise of the Private Placement Warrants will not be transferable, assignable or salable until

30
days after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and will be
non-redeemable
non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are
 
 held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants.
 
 

 

16

 

 

 

NOTE 11.

NOTE 10. FAIR VALUE MEASUREMENT 

 
 
 
The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company

 

Fair value is defined as the price that would havebe received in connection with thefor sale of the assetsan asset or paid in connection with thefor transfer of the liabilitiesa liability, in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchyGAAP establishes a three-tier fair value hierarchy, is used to classify assets and liabilities based on the observable inputs and unobservablewhich prioritizes the inputs used in order to value the assets and liabilities:

 
 
    measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include:

 

Level 1:  Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.
Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets;

 

 
 Level  
Level 2:  Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include2, defined as inputs other than quoted prices in active markets for similar assetsthat are either directly or indirectly observable such as quoted prices for similar instruments in active markets or liabilities and quoted prices for identical assets or liabilitiessimilar instruments in markets that are not active.; and

 

    
  
Level 3:  Unobservable inputs based on the Company’s assessment of the assumptions that market participants would use in pricing the asset or liability.
 
The following table presents Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

 

The following table presents information about the Company’s fair value hierarchy for assets and liabilities that are measured at fair value on a recurring basis as of September 30, 2021:  

 
 
The Warrantsat March 31, 2022 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:

 

                    
   Level 1   Level 2   Level 3   Total 
Liabilities:                    
Warrant Liabilities:                    
Public Warrants  $2,867,601   $   $   $2,867,601 
Private Placement Warrants           1,647,041    1,647,041 
Total Warrant Liabilities  $2,867,601   $   $1,647,041   $4,514,642 
                     
FPA  $   $   $   $ 

 

The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at December 31, 2021 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:

 

   Level 1   Level 2   Level 3   Total 
Liabilities:                    
Warrant Liabilities:                    
Public Warrants  $4,874,922   $   $   $4,874,922 
Private Placement Warrants           2,799,969    2,799,969 
Total Warrant Liabilities  $4,874,922   $   $2,799,969   $7,674,891 
                     
FPA  $   $   $150,000   $150,000 

 

The Warrants liabilities and FPA assets were accounted for as liabilities in accordance with ASC

815-40
815-40 and are presented within warrant liabilities and FPA assets on our balance sheet. The warrant liabilities and FPA asset/liability measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value of warrant liabilities and change in fair value of FPA assets, respectively, in the statement of operations.  
Level 1 instruments include investments in money market funds and U.S. Treasury securities and

 

Level 1 instruments include the Public Warrants. The Company uses inputs such as actual trade data, benchmark yields, quoted market prices from dealers or brokers, and other similar sources to determine the fair value of its investments. The Public Warrants for periods where no observable traded price was available are valued using a barrier option simulation. For the periodquarter ended September 30March 31, 20212022 (the periods subsequent to the detachment of the Public Warrants from the Units), the Public Warrant quoted market price was used as the fair value as of each relevant date. 

 

17

Warrants
 

 

 

Initial Measurement

 

Warrants

 

The Warrants were accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities on our condensed balance sheets. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value of warrant liabilities in the condensed statements of operations.  

 

The Private Warrants were valued using a Modified Black Scholes Option Pricing Model, which is considered to be a Level 3 fair value measurement. The Modified Black Scholes model’s primary unobservable input utilized in determining the fair value of the Private Warrants is the expected volatility of the ordinary shares. The expected volatility as of the IPO date was derived from observable public warrant pricing on comparable ‘blank-check’ companies without an identified target. The expected volatility as of subsequent valuation dates was implied from the Company’s own public warrant pricing. 

 

 
          
Input  March 31,
2022
   December 31,
2021
 
Risk-free interest rate   2.41%   1.25%
Expected term (years)   5    5 
Expected Volatility   8.4%   14.8%
Exercise Price  $11.50   $11.50 
Share Price  $11.50   $11.50 

 

The following table presents a summary of the changes in the fair value of the Private Placement Warrants, a Level 3 liability, measured on a recurring basis. 

 
 

 

     
Fair Value as of August 6, 2021  $3,524,667 
Change in valuation inputs or other assumptions(1)   (724,698)
Fair Value as of December 31, 2021  $2,799,969 
Change in valuation inputs or other assumptions(1)   (1,152,928)
Fair Value as of March 31, 2022  $1,647,041 

 

 
 
 
(1)
(1)
 
Represents the non-cash gain on the change in valuation of the Private Placement Warrants and is included in Gain on change in fair value of warrant liability in the unaudited condensed statement of operations. 
 
 
FPA Asset
 
The liability for the

 

FPA

 

The FPAs were valued using a discounted cash flows method, which is considered to be a Level 3 fair value measurement. Under the discounted cash flow method utilized, the aggregate commitment of $200200 million pursuant to the FPAs is discounted to present value and compared to the fair value of the ordinary shares and warrants to be issued pursuant to the FPAs. The fair value of the ordinary shares and warrants to be issued under the FPAs are based on the public trading price of the Units issued in the Company’s IPO. The excess (liability) or deficit (asset) of the fair value of the ordinary shares and warrants to be issued compared to the $5050 million fixed commitment is then reduced to account for the probability of consummation of the Business Combination. The primary unobservable input utilized in determining the fair value of the FPA is the probability of consummation of the Business Combination. As of September 30December 31, 2021, the probability assigned to the consummation of the Business Combination was 9595% which was determined based on observed success rates of business combinations for special purpose acquisition companies. 

 
 
 
 
 

 

     
Fair Value as of August 6, 2021 – Liability  $100,000 
Change in valuation inputs or other assumptions(1)   (250,000)
Fair Value as of December 31, 2021 – (Asset)  $(150,000)
Change in valuation inputs or other assumptions(1)   150,000 
Fair Value as of March 31, 2022  $ 

 

 
 
 
(1)
(1)
 
Represents the non-cash gain/loss on the change in valuation of the FPA asset and is included in Gain/Loss on change in fair value of FPA asset in the unaudited condensed statement of operations. 
 

 

 
 
NOTE 12. SUBSEQUENT EVENTS
 
Management of the Company evaluated

18

 

 

Note 11 – Subsequent Events

 

Management of the Company evaluated subsequent events and transactions that have occurred after the balance sheet date of September 30, 2021 throughup to the date thesethat the unaudited condensed financial statements were issued. Based upon the review, managementOther than as described in these financial statements, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the unaudited condensed financial statements. 

 

19


 
   
    
   
On
 
November
 
22, 2021 the Sponsor confirmed to the Company that it will provide any such Working Capital Loans for at least the next twelve months.
 
 
 
15
   
 
 
 
 
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
 

 

 

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

 

References to “we”, “us”, “our” or the “Company” are to Blue Whale Acquisition Corp I, except where the context requires otherwise. The following discussion should be read in conjunction with our condensed financial statements and related notes thereto included elsewhere in this report.

 
Cautionary Note Regarding Forward-Looking Statements
 
Certain information contained in the discussion and analysis set forth below includes forward-looking statements. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors.

 

Cautionary Note Regarding Forward-Looking Statements

 

This Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act, as amended, 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, 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 “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and variations thereof 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 the Company’s prospectus10-K filed with the SEC on August 4April 11, 20212022. 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. 
 
Overview
 

 

Overview

 

We are a blank check company incorporated as a Cayman Islands exempted company on March  10, 2021 for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combinationBusiness Combination with one or more businesses (the “Business Combination”). While we may pursue an initial Business Combination target in any industry or geographic location, we intend to focus our search for a target business operating in the media, entertainment and technology industries. Our sponsor isSponsor, Blue Whale Sponsor I LLC (the “Sponsor”), a Cayman Islands limited liability company.

 
Our registration statement for our initial public offering (the “We intend to effectuate our initial Business Combination using cash from the proceeds of our initial public offering and the private placement of the private placement warrants, our shares, debt or a combination of cash, equity and debt. We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete a Business Combination will be successful.

 

Our registration statement for our Initial Public Offering”) was declared effective on August  3, 2021. On August  6, 2021, we consummated our Initial Public Offering of 20,000,000 units (the “Units” and, with respect to, including the Class A ordinary shares included inissuance of 2,940,811 units as a result of the Units offered, the “Public Shares”)underwriters’ full exercise of their over-allotment option, at $10.00 per Unit, generating gross proceeds of $200 million and incurring offering costs of approximately $12,164,514, consisting of $4,000,000 of underwriting commission, $7,000,000 of deferred underwriting commission, and $1,164,514 of other offering costs. The Company also granted the underwriters in the IPO a

45-day
 option to purchase up to an additional 3,000,000 Units to cover over-allotments, if any.
 
Simultaneously with the closing of the Initial Public Offering, we consummated the private placement (the “Private Placement”) of 3,000,000 Warrants (each, a “Private Placement Warrant” and collectively, the “Private Placement Warrants”), at a price of $2.00 per Private Placement Warrant to our Sponsor, generating gross proceeds of $6 million.
 
Upon the closing of the Initial Public Offering and229,408,110. Each Unit consisted of one Public Share and one-fourth of one redeemable Warrant. Each whole Public Warrant entitles the holder to purchase one Public Share for $11.50 per share, subject to adjustment.

 

Following the closing of the Initial Public Offering on the Private Placement, an aggregate ofAugust 6, 2021, $200 million,000,000 ($10.00 per Unit) offrom the net proceeds of the sale of the Units in the Initial Public Offering and certain of the proceedssale of the Private Placement Warrants was placed in a trust account (non-interest bearing Trust Account (the “Trust Account”). with Continental Stock Transfer &If, in the future, the proceeds held in the Trust Company acting as trustee andAccount are invested, then the proceeds will be invested only in United StatesU.S. government treasury obligations bills with a maturity of 185 days or less or in money market funds investing solely in U.S. Treasuries and meeting certain conditions under Rule

2a-7
2a-7 under the Investment Company Act, as determined by the Company, until the earlier of: (i) the completion of a Business Combination and (ii) the distribution of funds in the Trust Account to the Company’s shareholders, as described below. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay franchise and income tax obligations (less up to $100,000 of interest to pay dissolution expenses), the proceeds from the Initial Public
 
 
 
16
 
  
 
 
 
 
 
 
 
 
 
Offering and the sale of the Private Placement Warrants will not which invest only in direct U.S. government treasury obligations. Assuming an interest rate of 0.10% per year, the trust account may generate approximately $200,000 of interest annually; however, we can provide no assurances regarding this amount or that we will invest in U.S. government treasury obligations. We will not be permitted to withdraw any of the principal or interest held in the trust account except for the withdrawal of interest to pay taxes, if any. The funds held in the trust account will not otherwise be released from the trust account until the earliest of: (i) the1) our completion of the Company’san initial Business Combinationbusiness combination; (ii2)  the redemption of any public shares properly submitted in connection with a shareholder vote to amend the Company’s Amendedour amended and Restated Memorandumrestated memorandum and Articlesarticles of Associationassociation (aA)  to modify the substance or timing of itsour obligation to allow redemption in connection with the Company’sour initial business combination or to redeem 100% of itsour public shares if the Company doeswe do not complete itsour initial business combination within 24 months from the closing of the Initial Public Offeringthis offering or (bB)  with respect to any other provisionsprovision relating to shareholders’ rights or
pre-initial
business combination activity; and (iii) 3) the redemption of theour public shares if the Company haswe have not completed an initial business combination within 24 months from the closing of the Initial Public Offeringthis offering, subject to applicable law (the “Combination Period”). The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. .

 

20

If we are unable to complete a

 

 

If we are unable to complete our initial Business Combination within the Combination Period, asor such period may be extendedduring any Extension Period, we will (i)  cease all operations except for the purpose of winding up;, (ii)  as promptly as reasonably possible but notno more than 10ten business days thereafter, redeem the public shares, at a

per-share
per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust accountTrust Account, divided by the number of then issued and outstanding public shares, which redemption will completely extinguish public shareholdersShareholders rights as shareholders (including the right to receive further liquidatingliquidation distributions, if any);, subject to applicable law, and (iii)  as promptly as reasonably possible following such redemption, subject to the approval of ourthe remaining shareholders and ourthe Company’s board of directors, liquidate and dissolveproceed to commence a voluntary liquidation and thereby a formal dissolution of the Company, subject in each case to ourits obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. 
 
Results of Operations
 
Our only activities from inception through September 30, 2021

 

Liquidity and Capital Resources

 

On August 6, 2021 the Company consummated the Initial Public Offering of 20,000,000 units, generating gross proceeds of $200,000,000. Simultaneously with the closing of the Initial Public Offering, the Company consummated a private placement of 3,000,000 Warrants at a price of $2.00 per Private Placement Warrant to its Sponsor, generating gross proceeds of $6,000,000.

 

On August 16, 2021, the underwriters partially exercised the over-allotment option and purchased an additional 2,940,811 Units, generating an aggregate of gross proceeds of $29,408,110, incurred $588,162 in cash underwriting fees, and forfeited the remainder of the option, which over-allotment closed on August 18, 2021. Simultaneously with the closing of the exercise of the over-allotment option, the Company completed the private sale of an aggregate of 294,081 Private Warrants to the Company’s Sponsor, at a purchase price of $2.00 per Private Warrant, generating gross proceeds of $588,162.

 

Following the consummation of the Initial Public Offering on August 6, 2021, an amount of $200,000,000 ($10.00 per Unit) from the net proceeds of the sale of the Units in the Initial Public Offering was placed in the Trust Account. Transaction costs amounted to $13,781,962 consisting of $4,588,162 of underwriting fees, $8,029,284 of deferred underwriting fees and $1,164,516 of other costs.

 

As of March 31, 2022 and December 31, 2021, we had approximately $229,408,110 cash held in the Trust Account. We intend to use substantially all of the funds held in the Trust Account and the proceeds from the sale of the forward purchase shares to complete our Business Combination. To the extent that our shares or debt is used, in whole or in part, as consideration to complete our Business Combination, the remaining proceeds held in the Trust Account will be used as working capital to finance the operations of the post-Business Combination entity, make other acquisitions and pursue our growth strategies.

 

As of March 31, 2022 and December 31, 2021, we had cash of $2,406,907 and $66,156 held outside of the Trust Account, respectively. We intend to use the funds held outside of the Trust Account primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, properties, or similar locations of prospective target businesses or their representative or owners, review corporate documents and material agreements of prospective target businesses, and structure, negotiate and complete a Business Combination.

 

In order to finance transaction costs in connection with a Business Combination, our Sponsor or an affiliate of our Sponsor, or our officers and directors may provide us working capital loans (“Working Capital Loans”). On February 16, 2022, the Sponsor confirmed to the Company that it will provide any such Working Capital Loans for at least the next twelve months. On February 22, 2022, the Company drew down and received cash proceeds of $2.5 million. The outstanding balance under this loan is $2.5 million as of March 31, 2022. If we complete a Business Combination, we may repay such loaned amounts out of the proceeds of the Trust Account released to us. In the event that a Business Combination does not close, we may use a portion of the working capital held outside the Trust Account to repay such loaned amounts, but no proceeds from our Trust Account would be used for such repayment. Up to $2,500,000 of such loans may be convertible into warrants, at a price of $2.00 per warrant, at the option of the lender. The warrants would be identical to the Private Placement Warrants.

 

Based on the foregoing, management believes that the Company will have sufficient working capital and borrowing capacity to meet its needs through the earlier of the consummation of a Business Combination or one year from this filing. Over this time period, we will be using the funds held outside of the Trust Account for paying existing accounts payable, identifying, and evaluating prospective Business Combination candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to merge with or acquire, and structuring, negotiating, and consummating the Business Combination.

 

21

 

 

Results of Operations

 

Our only activities from inception through March 31, 2022, were those related to our formation, the preparation for our Initial Public Offering and, since the closing of the Initial Public Offering, the search for a prospective initial Business Combination. We have neither engaged in any operations nor generated any operating revenues to date. We will not generate any operating revenues until after completion of our initial Business Combination, at the earliest. We incurred expenses as a result of being a public company (including for legal, financial reporting, accounting and auditing compliance), as well as for expenses in connection with searching for a prospective initial Business Combination. 

 
For the three months ended September 30, 2021

 

For the three months ended March 31, 2022, we had a net income of approximately $817$2,594450,292, which consists of changes in the derivative warrant liabilitiesis comprised of formation and operating expenses of $559,957, a change in fair value of the warrant liability of $3,160,249 and a change in the fair value of approximately $1,492,935, financing costs for our warrant liabilities of approximately $342,640 and unrealized gain on investments held in the Trust Account of approximately $5,000, partially offset by approximately $337,701 in general and administrative costs.

 
Liquidity and Capital Resources
 
As of September 30, 2021, we had approximatelythe FPA of $150,000.

 

For the period from March 10, 2021 (inception) through March 31, 2021, we had a net loss of $2295,413000,110 cash held in thewhich is comprised of formation and operating expenses of $5,000.

 

Related Party Transactions

 

Founder Shares

 

On March 11, 2021, the Company issued an aggregate of 5,750,000 shares of Class B ordinary shares (the “Founder Shares”) to the Sponsor for an aggregate purchase price of $25,000. The Founder Shares include an aggregate of up to 750,000 shares subject to forfeiture by the Sponsor to the extent that the underwriters’ over-allotment is not exercised in full Trust Accountor in part. We intend to use substantially all of the funds held the Trust Account, including any amounts, representing interest earned on the Trust Account (less taxes payable (if applicable) and deferred underwriting commissions) and the proceeds from the sale of the forward purchaseSuch shares have been recapitalized into 2,548,979 Class F ordinary shares and 5,097,958 Class G ordinary shares (which we respectively refer to as “Class F founder shares” and “Class G founder shares,” and collectively refer to as “founder shares” as further described herein). Pursuant to a re-organization of the Company’s share capital effective July 5, 2021, the Class B ordinary shares have been canceled and all of the shares presently issued and outstanding are Class F ordinary shares and Class G ordinary shares. (See Note 9).

 

On August 18, 2021, the underwriters partially exercised the over-allotment option resulting in the issuance of an additional 326,757 Class F ordinary shares and 653,513 Class G ordinary shares to complete our Business Combination. To the extend that our shares or debt is used, in whole or in part, as consideration to complete our Business Combination, the remaining proceeds held in the Trust Account will be used as working capital to finance the operations of the post-Business Combination entity, make other acquisitions and pursue our growth strategies.

 
As of September 30, 2021, we had cash of $372,788 held outside of the Trust Account. We intend to use the funds held outside of the Trust Account primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, properties, or similar locations of prospective target businesses or their representative or owners, review corporate documents and material agreements of prospective target businesses, and structure, negotiate and complete a Business Combination.
 
 
Prior to the completion of the Initial Public Offering, our liquidity needs were satisfied through a payment fromthe Sponsor.

 

The Sponsor has agreed not to transfer, assign or sell any of its Founder Shares until two years after the completion of a Business Combination.

 

Related Party Loans

 

On March 11, 2021, the Sponsor of $25,000 (see Note 6) foragreed to loan the Founder Shares and borrowings under the Promissory Note ofCompany an aggregate of up to $300,000 (seeto Note 6). Subsequent to the consummation ofcover expenses related to the Initial Public Offering and Private Placement, our liquidity needs have been satisfied frompursuant to a promissory note (the “Note”). The Note is non-interest bearing and is payable on the proceeds from the Initial Public Offering and Private Placement not held in the Trust Account. During the interim period ended September 30earlier of (i) December 31, 2022 or (ii) the date the Company completes its initial Business Combination. As of March 31, 2022 and December 31, 2021, the Company has sustained negative cash flows from operations and expects to continue to incur negative cash flows from operations for at least the next twelve months from the filing of this report. Consequently, substantial doubt about the Company’s ability to continue as a going concern existed as of September 30, 2021. In addition, in$156,384 outstanding on the Note, which is classified as current on our Balance Sheet.

 

In order to finance transaction costs in connection with a Business Combination, ourthe Company’s Sponsor or, an affiliate of ourthe Sponsor, or ourthe Company’s officers and directors may provide us working capital loans (loan the Company funds as may be required (the “Working Capital Loans”). On November 22Such Working Capital Loans would be evidenced by promissory notes. On February 16, 20212022, the Sponsor confirmed to the Company that it will provide any such Working Capital Loans for at least the next twelve months. As of September 30, 2021, there were no amounts outstanding under any Working Capital Loan.

 
 
 
17
 
 
 
 
 
 
 
Based on the foregoing, management believes that we will have sufficient working capital and borrowing capacity to meet its needs through the earlier of the, pursuant to a promissory note. The notes would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $2,500,000 of notes may be converted upon consummation of a Business Combination or one yearinto warrants at froma this filing. Over this time period, weprice of $2.00 per warrant. The warrants will be using the funds held outside ofidentical to the Private Placement Warrants. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account for paying existing accounts payable, identifying and evaluating prospective Business Combination candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to merge with or acquire, and structuring, negotiating and consummating the Business Combination.
 
Off-Balance
 Sheet Arrangements; Commitments and Contractual Obligations; Quarterly Results
 
As of September 30, 2021, we did not have any
off-balance
 sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation
S-K
 and did not have any commitments or contractual obligations other than obligations disclosed herein.
 
Contractual Obligations
 
Administrative Services Agreement
 
Commencing on the date that our securities were first listed on Nasdaq through the earlier of consummation of the initial Business Combination and the liquidation, we agreed to pay our Sponsor $10,000 per month for office space, secretarial and administrative services provided to us by an affiliate of our Sponsor. There was no balance due to related party at September 30, 2021.
 
In addition, our Sponsor, officers and directors, or our respective affiliates will be reimbursed for any
out-of-pocket
to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans.

 

In addition, our Sponsor, officers and directors, or our respective affiliates will be reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable Business Combinations. Our audit committee will review on a quarterly basis all payments that were made by us to our Sponsor, executive officers or directors, or our affiliates. Any such payments prior to an initial Business Combination will be made using funds held outside the Trust Account. There was no balance due to related party at September 30$325,000 due to related party at March 31, 2022 and December 31, 2021, respectively.

 

22

 

 

Contractual Obligations

 

Administrative Services Agreement

 

Commencing on the date that our securities were first listed on Nasdaq through the earlier of consummation of the initial Business Combination and the liquidation, we agreed to pay our Sponsor $10,000 per month for office space, secretarial and administrative services provided to us by an affiliate of our Sponsor. There was no balance due to related party at March 31, 2022 and December 31, 2021.

 
, respectively.

 

Registration Rights Agreement 

 

 

The holders of the Founder Shares, Private Placement Shares, and any shares that may be issued upon conversion of Working Capital Loans (and any Class  A ordinary shares issuable upon conversion of the Founder Shares) were entitled to registration rights pursuant to a registration and shareholder rights agreement signed upon the effective date of the Initial Public Offering. The holders of these securities were entitled to make up to three demands, excluding short form demands, that we register such securities. In addition, the holders had certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of the initial Business Combination. We will bear the expenses incurred in connection with the filing of any such registration statements. 

 
Underwriting Agreement
 
The Company granted the underwriters a
45-day
 option to purchase up to 3,000,000 additional Units to cover over-allotments at the Initial Public Offering price, less the underwriting discounts and commissions.
 

 

Underwriting Agreement

 

The underwriters were paid a cash underwriting discount of 2.00% of the gross proceeds of the Initial Public Offering, or $4,000588,000162. In addition, the underwriters will be entitled to a deferred fee of three and half percent (3.50%) of the gross proceeds of the Initial Public Offering, or $78,000029,000284. On August  16, 2021, the underwriters partially exercised the over-allotment option and purchased an additional 2,940,811 Over-Allotment Units, generating an aggregate of gross proceeds of $29,480,110, incurred $588,162 in cash underwriting fees and $1,029,284 in deferred underwriters’ fees, and forfeited the remainder of the option, which over-allotment closed on August  18, 2021. The deferred fee was placed in the Trust Account and will be paid in cash upon the closing of a Business Combination, subject to the terms of the underwriting agreement. 

 
 
 
18
 
 
 
 
 
 
 
 
 
 
 
 
Forward Purchase Agreement
 

 

Forward Purchase Agreement

 

The Company entered into a forward purchase agreement with MIC Capital Partners (Public) Parallel Cayman, LP, an affiliate of the Sponsor, providing for the purchase, in its sole discretion, an aggregate of up to 5,000,000 Units for an aggregate purchase price of up to $50,000,000, or $10.00 per Unit, in a private placement to close substantially concurrently with the closing of our initial Business Combination. The forward purchase investor will determine in its sole discretion the specific number of forward purchase Units it will purchase, if any, pursuant to the forward purchase agreement. Each forward purchase Unit will consist of one Class  A ordinary share and

one-fourth
of one redeemable Warrant. The terms of the forward purchase Units will generally be identical to the terms of the units being issued in the Initial Public Offering, except that the securities underlying the forward purchase Units will be subject to certain registration rights. 
 
Critical Accounting Policies and Estimates
 

 

Critical Accounting Estimates

 

This management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with GAAPUnited States Generally Accepted Accounting Polices (“GAAP”). The preparation of our financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in our financial statements. On an ongoing basis, we evaluate our estimates and judgments, including those related to fair value of financial instruments and accrued expenses. We base our estimates on historical experience, known trends and events and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. The company has identified the following as its critical accounting policies: 

 
Warrant Liabilities
 
We do not use derivative instruments to hedge exposures to cash flow, market

 

23

 

 

Derivative Financial Instruments

 

The Company accounts for the Warrants and Forward Purchase Agreements (“FPAs”) as either equity-classified or liability-classified instruments based on an assessment of the specific terms of the Warrants and FPAs and the applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, “Distinguishing Liabilities from Equity” (“ASC 480”), and or foreign currency risks. We evaluate all of ourASC 815, “Derivatives and Hedging” (“Warrants and FPAs ASC 815”). The assessment considers whether they are freestanding financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480 and ASC

815-15.
 The, meet the definition of a liability pursuant to ASC 480, and meet all of the requirements for equity classification of derivative instruments, including whether such instruments shouldunder ASC 815, including whether the Warrants and FPAs are indexed to the Company’s own ordinary shares and whether the holders of the Warrants could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of issuance of the Warrants and execution of the FPAs and as of each subsequent quarterly period end date while the Warrants and FPAs are outstanding. For issued or modified warrants and FPAs that meet all of the criteria for equity classification, such warrants are required to be recorded as liabilities or as equity, is
re-assessed
 at the enda component of additional paid-in capital at the time of each reporting period.
 
We issued an aggregate of 5issuance. For issued or modified warrants and FPAs that do not meet all the criteria for equity classification, such warrants are required to be recorded at their initial fair value on the date of issuance,000,000 ordinary shares warrants associated with Units issued to investors and each balance sheet date thereafter. Changes in our Initial Public Offering and we issued 3,294,081 Private Placement Warrants. All of our outstandingthe estimated fair value of liability-classified warrants are recognized as derivative liabilities in accordance with ASC
815-40.
 Accordingly, we recognize the warrant instruments as liabilities at fair value and adjust the instruments to fair value at each reporting period. The liabilities are subject to remeasurement at each balance sheet date until exercised, and any change in fair value is recognized in the Company’s statement of operations. The fair value of warrants issued in connection with the Initial Public Offering and Private Placement were initially measured at fair value using a binomial lattice model. The fair value of Warrants issued in connection with our Initial Public Offering have subsequently been measured based on the listed market price of such warrants, and the fair value of the Private Placement Warrants have been estimated using a binomial lattice model each measurement date.
 
 
 
19
 
 
 
 
 
 
 
Investments Held in Trust Account
 
The Company’s portfolio of investments is comprised solely of U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act, with a maturity of 185 days or less, or investments in money market funds that invest in U.S. government securities, or a combination thereof. The Company’s investments held in the Trust Account are classified as trading securities. Trading securities are presented on the balance sheet at fair value at the end of each reporting period. Gains and losses resulting from the change in fair value of these securities is included in net gain on investments held in Trust Account in the accompanying statement of operations. The estimated fair values of investments held in the Trust Account are determined using available market information, other than for investments in open-ended money market funds with published daily net asset values (“NAV”), in which case the Company uses NAV as a practical expedient to fair value. The NAV on these investments is typically held constant at $1.00 per unit.
 
Fair Value of Financial Instruments
 
Fair value measurements are based on the premise that fair value is an exit price representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the following three-tier fair value hierarchy has been used in determining the inputs used in measuring fair value:
 
 
            
     
Level 1    Quoted prices in active markets for identical assets or liabilities on the reporting date.
   
Level 2    Pricing inputs are based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
   
Level 3    Pricing inputs are generally unobservable and include situations where there is little, if any, market activity for the investment. The inputs into the determination of fair value require management’s judgment or estimation of assumptions that market participants would use in pricing the assets or liabilities. The fair values are therefore determined using factors that involve considerable judgment and interpretations, including, but not limited to, private and public comparables, third-party appraisals, discounted cash flow models, and fund manager estimates.
 
 
As of September 30, 2021, the recorded values of cash and cash held in the Trust Account, prepaid expenses, accounts payable, accrued expenses and accrued expenses – related party approximate the fair values due to the short-term nature of the instruments.
 
Class A Ordinary shares Subject to Possible Redemption
 
Class A ordinary shares subject to mandatory redemption (if any) are classified as liability instruments and are measured at fair value. Conditionally redeemable Class A ordinary shares (including Class A ordinary shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) are classified as temporary equity. At all other times, Class A ordinary shares is classified as shareholders’ equity. Our Class A ordinary shares features certain redemption rights that are considered to be outside of our control and subject to the occurrence of uncertain future events. Accordingly, at September 30, 2021, 22,940,811 shares of Class A ordinary shares subject to possible redemption are presented as temporary equity, outside of the shareholders’ equity section of the Company’s balance sheet.
 
 
 
20
 
 
 
 
 
 
 
 
 
 
 
 
Net Earnings (Loss) Per Ordinary Share
 
Net income (loss) per share is computed by dividing net income by the weighted-average number of ordinary shares outstanding during the period. We have not considered the effect of the warrants sold in the Public Offering and Private Placement to purchase an aggregate of 8,000,000 shares in the calculation of diluted loss per share, since the exercise of the warrants are contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive.
 
Our statement of operations includes a presentation of earnings (loss) per share for Class A ordinary shares subject to redemption in a manner similar to the
two-class
 method of earnings (loss) per share. Net income per common share, basic and diluted, for Class A ordinary shares subject to redemption is calculated by dividing the proportionate share of earnings or loss on marketable securities held by the Trust Account, neta non-cash gain or loss on the statements of operations.

 

Recently Issued Accounting Standards

 

In August 2020, 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 applicable franchisebeneficial conversion and income taxes, by the weighted average number of ordinary shares subject to possible redemption outstanding since original issuancecash 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.

 
Net income or lossASU 2020-06 amends the diluted earnings per share, basic and diluted, for
non-redeemable
 ordinary shares is calculated by dividing the net income or loss, adjusted for income or loss on marketable securities attributable to ordinary shares subject to redemption, by the weighted average number of
non-redeemable
 ordinary shares outstanding for the period.
 
JOBS Act
 
On April 5, 2012, the JOBS Act was signed into law guidance, including the requirement to use the if-converted method for all convertible instruments. ASU 2020-06 is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years, with early adoption permitted. The JOBS Act contains provisions that,Company is currently evaluating the impact this guidance will have on its financial statements. 

 

Management does not believe that amongany other things, relax certain reporting requirements for qualifying public companies. Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do notrecently issued, but not yet effective, accounting standards, if currently adopted, would have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to

non-emerging
 growth companies but any such an election to opt out is irrevocable. We have elected to irrevocably opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, we will adopt the new or revised standard at the time public companies adopt the new or revised standard. This may make comparison of our financial statements with another emerging growth company that has not opted out of using the extended transition period difficult or impossible because of the potential differences in accountant standards used.
 
Additionally, we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an “emerging growth company”, we choose to rely on such exemptions we may not be required to, among other things, (i) provide an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may be required of
non-emerging
 growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (auditor discussion and analysis), and (iv) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation. These exemptions will apply for a period of five years following the completion of our Initial Public Offering or until we are no longer an “emerging growth company,” whichever is earlier.
 
 
 
21
 
 
 
 
 
 
 
Item 3. Quantitative and Qualitative Disclosures About Market Risk
 
material effect on our financial statements.

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk

 

We are a smaller reporting company as defined by Rule

12b-2
12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item. 
 

 

Item 4. Controls and Procedures

 

 

Evaluation of Disclosure Controls and Procedures 

 

 

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures as of the end of the fiscal quarter ended September 30, 2021March 31, 2022, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on this evaluation, our principal executive officer and principal financial officer have 

 

Disclosure controls and procedures are designed to ensure that information required to be disclosed by us in our Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

 

24

 

 

Based on this evaluation, our principal executive officer and principal financial officer have concluded that during the period covered by this report, our disclosure controls and procedures were not effective as of September 30March 31, 20212022, because of a material weakness in our internal control over financial reporting. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. Specifically, the Company’s management has concluded that our control around the interpretation and accounting for certain complex features of the Class A ordinary sharesfinancial instruments issued by the Company was not effectively designed or maintained. This material weakness resulted in the restatement of the Company’s balance sheet as of August 6, 2021. Additionally, this

 

The Company, with the oversight of its Audit Committee, is actively undertaking remediation efforts to address the material weakness could result in a misstatement ofidentified above and is developing measures and controls to prevent a re-occurrence of such a deficiency in the future. The remediation plan will include the Class A ordinary shares and related accounts and disclosures that would result in a material misstatement of the financial statements that would not be prevented or detected on a timely basis.

 
Disclosure controls and procedures are designed to ensure that information required to be disclosed by us in our Exchange Act reports is recorded, processed, summarizedfollowing actions:

 

 
Implement additional monitoring controls and formalizing the review process of its post-close procedures, and;

 

 
Enhance the formality and rigor of review procedures around complex financial instruments including consulting with subject matter experts

 

The Company is committed to maintaining an effective internal control environment, and although it has made progress in this area, additional steps need to be taken, as indicated above, and reported within the time periodssufficient time needs to elapse before management can conclude that the newly implement specified in the SEC’s rules and forms,controls are operating effectively and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

 
the material weakness has been adequately remediated.

 

Changes in Internal Control over Financial Reporting 

 

 

There was no change in our internal control over financial reporting that occurred during the fiscal quarter ended September 30period from inception through March 31, 20212022 covered by this Quarterly Report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting except for the below: 

 
The
 
principal financial officer 

 

The principal financial officer performed additional accounting and financial analyses and other post-closing procedures including consulting with subject matter experts related to the accounting for certain complex features of the Class A ordinary sharesfinancial instruments. The Company’s management has expended, and will continue to expend, a substantial amount of effort and resources for the remediation and improvement of our internal control over financial reporting. While we have processes to properly identify and evaluate the appropriate accounting technical pronouncements and other literature for all significant or unusual transactions, we have expanded and will continue to improve these processes to ensure that the nuances of such transactions are effectively evaluated in the context of the increasingly complex accounting standards. 

 

25

 
 
22
 
 
 
 
 
 
 
 
 
 
 
 
PART II—OTHER INFORMATION
 
Item 1. Legal Proceedings
 
None.
 
Item 1A. Risk Factors
 
We have identified material weaknesses in our internal control over financial reporting as of September 30, 2021. If we are unable to develop and maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results in a timely manner, which may adversely affect investor confidence in us and We have identified a material weakness in our internal control over financial reporting as of September 30

 

 

PART II—OTHER INFORMATION

 

Item 1. Legal Proceedings

 

None.

 

Item 1A. Risk Factors

 

Factors that could cause our actual results to differ materially from those in this Quarterly Report are any of the risks previously disclosed in our Annual Report on Form 10-K filed with the SEC on April 11, 2022. Any of those 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 on Form 10-K filed with the SEC on April 11, 2022, except for the following:

 

Our search for a Business Combination, and any target business with which we may ultimately consummate a Business Combination, may be materially adversely affected by the geopolitical conditions resulting from the recent invasion of Ukraine by Russia and subsequent sanctions against Russia, Belarus and related individuals and entities and the status of debt and equity markets, as well as protectionist legislation in our target markets.

 

United States and global markets are experiencing volatility and disruption following the escalation of geopolitical tensions and the recent invasion of Ukraine by Russia in February 2022. In response to such invasion, the North Atlantic Treaty Organization (“NATO”) deployed additional military forces to eastern Europe, and the United States, the United Kingdom, the European Union and other countries have announced various sanctions and restrictive actions against Russia, Belarus and related individuals and entities, including the removal of certain financial institutions from the Society for Worldwide Interbank Financial Telecommunication (SWIFT) payment system. Certain countries, including the United States, have also provided and may continue to provide military aid or other assistance to Ukraine during the ongoing military conflict, increasing geopolitical tensions with Russia. The invasion of Ukraine by Russia and the resulting measures that have been taken, and could be taken in the future, by NATO, the United States, the United Kingdom, the European Union and other countries have created global security concerns that could have a lasting impact on regional and global economies. Although the length and impact of the ongoing military conflict in Ukraine is highly unpredictable, the conflict could lead to market disruptions, including significant volatility in commodity prices, credit and capital markets, as well as supply chain interruptions. Additionally, Russian military actions and the resulting sanctions could adversely affect the global economy and financial markets and lead to instability and lack of liquidity in capital markets.

 

Any of the abovementioned factors, or any other negative impact on the global economy, capital markets or other geopolitical conditions resulting from the Russian invasion of Ukraine and subsequent sanctions, could adversely affect our search for a Business Combination and any target business with which we may ultimately consummate a Business Combination. The extent and duration of the Russian invasion of Ukraine, resulting sanctions and any related market disruptions are impossible to predict, but could be substantial, particularly if current or new sanctions continue for an extended period of time or if geopolitical tensions result in expanded military operations on a global scale. Any such disruptions may also have the effect of heightening many of the other risks described in the “Risk Factors” section of our Annual Report on Form 10-K. If these disruptions or other matters of global concern continue for an extensive period of time, our ability to consummate a Business Combination, or the operations of a target business with which we may ultimately consummate a Business Combination, may be materially adversely affected.

 

In addition, the recent invasion of Ukraine by Russia, and the impact of sanctions against Russia and the potential for retaliatory acts from Russia, could result in increased cyber-attacks against U.S. companies.

 

Changes in laws or regulations or how such laws or regulations are interpreted or applied, or a failure to comply with any laws or regulations, may adversely affect our business, including our ability to negotiate and complete our initial Business Combination, and results of operations.

 

We are subject to laws and regulations enacted by national, regional and local governments. In particular, we are required to comply with certain SEC and other legal requirements, our business combination may be contingent on our ability to comply with certain laws and regulations and any post-business combination company may be subject to additional laws and regulations. Compliance with, and monitoring of, applicable laws and regulations may be difficult, time consuming and costly. A failure to comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect on our business, including our ability to negotiate and complete our initial Business Combination, and results of operations. In addition, those laws and regulations and their interpretation and application may change from time to time, including as a result of changes in economic, political, social and government policies, and those changes could have a material adverse effect on our business, including our ability to negotiate and complete our initial Business Combination, and results of operations.

 

On March 30, 2022, the SEC issued proposed rules that would, among other items, impose additional disclosure requirements in business combination transactions involving SPACs and private operating companies; amend the financial statement requirements applicable to business combination transactions involving such companies; update and expand guidance regarding the general use of projections in SEC filings, as well as when projections are disclosed in connection with proposed business combination transactions; increase the potential liability of certain participants in proposed business combination transactions; and impact the extent to which SPACs could become subject to regulation under the Investment Company Act of 1940. These rules, if adopted, whether in the form proposed or in revised form, may materially adversely affect our business, including our ability to negotiate and complete our initial business combination and may increase the costs and time related thereto.

 

26

 

 

We have identified material weaknesses in our internal control over financial reporting. This material weakness could continue to adversely affect our ability to report our results of operations and financial condition accurately and in a timely manner.

 

In connection with the preparation of the Company’s financial statements as of December 31, 2021, the Company reevaluated the classification of the complex financial instruments. After consultation with our independent registered public accounting firm, our management and our audit committee concluded that the previously issued financial statements as of August 6, 2021 should be restated to report all Class A ordinary shares subject to possible redemption as temporary equity. This error correction is reflected in our Form 10Q for the period ended September 30, 2021.

 

As described elsewhere in this Quarterly Report, we identified a material weakness in our internal control over financial reporting related to the accounting for the Company’s complex financial instruments.  As a result of this material weakness, our management has concluded that our internal controls over financial reporting were not effective as of March 31, 2022.  For a discussion of management’s consideration of the material weakness identified related to our accounting for complex financial instruments we issued in connection with our IPO, see Part I, Item 4: Controls and Procedures included in this Quarterly Report. As described in Item 4. “Controls and Procedures,” we have concluded that our internal controls over financial reporting was ineffective as of March 31, 2022 because a material weakness existed in our internal control over financial reporting. We have taken a number of measures to remediate the material weakness described therein; however, if we are unable to remediate our material weakness in a timely manner or we identify additional material weaknesses, we may be unable to provide required financial information in a timely or reliable manner and we may incorrectly report financial information. Likewise, if our financial statements are not filed on a timely basis, we could be subject to sanctions or investigations by the Nasdaq, where our ordinary shares are listed, the SEC or other regulatory authorities. In such a case, there could result a material adverse effect on our business results of operations and financial condition and our ability to complete a Business Combination. The existence of material weaknesses or significant deficiencies in internal control over financial reporting could adversely affect our reputation or investor perceptions of us, which could have a negative effect on the trading price of our shares. In addition, we may incur additional costs to remediate the material weakness in our internal control over financial reporting, as described in Item 4. “Controls and Procedures.”

 

We can give no assurance that the measures we have taken and plan to take in the future will remediate the material weakness identified or that any additional material weaknesses or restatements of financial results will not arise in the future due to a failure to implement and maintain adequate internal control over financial reporting or circumvention of these controls or otherwise.

 

See also our risk factor "We have identified material weaknesses in our internal control over financial reporting as of December 31, 2021. If we are unable to develop and maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results in a timely manner, which may adversely affect investor confidence in us and materially and adversely affect our business and operating results. 

 
In connection with the preparation of the Company’s financial statements as of September 30, 2021, the Company reevaluated the classification of the complex financial instruments. After consultation with our independent registered public accounting firm, our management and our audit committee concluded that the previously issued financial statements as of August 6, 2021 should be restated to report all Class A ordinary shares subject to possible redemption as temporary equity.
 
As described elsewhere in this Quarterly Report on Form 10-Q, we identified a material weakness in our internal control over financial reporting related to the accounting for the Company’s complex financial instruments. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented, or detected and corrected on a timely basis.
 
Effective internal controls are necessary for us to provide reliable financial reports and prevent fraud. We have taken a number of measures to remediate the material weaknesses, and continue to evaluate steps to remediate the material weaknesses. However, these remediation measures may be time consuming and costly and there is no assurance that these initiatives will ultimately have the intended effects. If we are unable to remediate our material weaknesses in a timely manner or we identify additional material weaknesses, we may be unable to provide required financial information in a timely and reliable manner and we may incorrectly report financial information. If our financial statements are not filed on a timely basis, we could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities. Failure to timely file would cause us to be ineligible to utilize short form registration statements on Form S-3 or Form S-4, which may impair our ability to obtain capital in a timely fashion to execute our business strategies or issue shares to effect an acquisition. If any of these events were to occur, it could have a material adverse effect on our business.
 
In addition, the existence of material weaknesses or a significant deficiency in internal control over financial reporting could adversely affect our reputation or investor perceptions of us, which could have a negative effect on the trading price of our securities.
 
We can provide no assurance that the measures we have taken and plan to take in the future will remediate the material weaknesses identified or that any additional material weaknesses or restatements of financial results will not arise in the future due to a failure to implement and maintain adequate internal control over financial reporting. In addition, even if we are successful in strengthening our controls and procedures, in the future those controls and procedures may not be adequate to prevent or identify irregularities or errors or to facilitate the fair presentation of our financial statements.
 
We may face litigation and other risks as a result of the material weakness in our internal control over financial reporting.
 
" in our Annual Report on Form 10-K for the year ended December 31, 2021.

 

We may face litigation and other risks as a result of the material weakness in our internal control over financial reporting.

 

As a result of such material weaknesses, the changes in accounting for the warrants and for Class A ordinary shares subject to redemption, and other matters raised or that may in the future be raised by the SEC, we face potential for litigation or other disputes which may include, among others, claims invoking the federal and state securities laws, contractual claims or other claims arising from the material weaknesses in our internal control over financial reporting and the preparation of our financial statements. As of the date of this Quarterly Report on Form 10-Q, we have no knowledge of any such litigation or dispute. However, we can provide no assurance that such litigation or dispute will not arise in the future. Any such litigation or dispute, whether successful or not, could have a material adverse effect on our business, results of operations and financial condition or our ability to complete a business combination. 

 

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds from Registered Securities

 
On August 6, 2021, we consummated our Initial Public Offering

 

Unregistered Sales

 

In March 2021, the Sponsor paid $25,000, or approximately $0.004 per share, to cover certain offering costs in consideration for 5,750,000 Class B ordinary shares, par value $0.0001. Up to 750,000 founder shares were subject to forfeiture by the Sponsor depending on the extent to which the underwriters’ over-allotment option was exercised. Such shares have been recapitalized into 2,548,979 Class F ordinary shares and 5,097,958 Class G ordinary shares (which we respectively refer to as “Class F founder shares” and “Class G founder shares,” and collectively refer to as “founder shares”). Pursuant to a re-organization of the Company’s share capital effective July 5, 2021, the Class B ordinary shares have been canceled and all of 20,000,000 Units.the shares The Units were sold at an offering price of $10.00 per Unit, generating total gross proceeds of $200,000,000. Goldman Sachs & Co. LLC and BofA Securities actedpresently issued and outstanding are Class as book-running managers inF ordinary shares and the offering. The securities sold in the offering were registered under the Securities Act on a registration statement on Form

S-1
 (No.
333-257816).
 The SEC declared the registration statement effective on August 3, 2021.
 
Class G ordinary shares.

 

Simultaneously with the consummation of the Initial Public Offering, we consummated a private placement of 3,000,000 Private Placement Warrants to our Sponsor at a price of $2.00 per Private Placement Warrant, generating total proceeds of $6,000,000. On August 1816, 2021, simultaneously with the issuance and sale of the Over-Allotment Units, the Company consummated the sale of an additional 294,081 Private Placement Warrants to the Sponsor at a purchase price of $2.00 per Private Placement Warrant, generating gross proceeds of $588,162. Such securities were issued pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act.

 

 

The Private Placement Warrants are identical to the warrants sold as part of the Units in the Initial Public Offering except that, so long as they are held by the Sponsor or its permitted transferees: (1)  they will not be redeemable by us (except in certain redemption scenarios when the price per Class  A ordinary share equals or exceeds $10.00 (as adjusted)); (2) they (including the Class  A ordinary shares issuable upon exercise of these warrants) may not, subject to certain limited exceptions, be transferred, assigned or sold by our sponsorSponsor until 30 days after the completion of our initial Business Combination; (3)  they may be exercised by the holders on a cashless basis; and (4)  they (including the ordinary shares issuable upon exercise of these warrants) are entitled to registration rights. 

 

 

27

 

 

Of the gross proceeds received from the Initial Public Offering, including the partial exercise of the over-allotment option, and the sale of and the Private Placement Warrants, $229,408,110 were placed in the Trust Account. 

 

 

We paid a total of $4,588,162 in underwriting discounts and commissions and $1,614,514164,516 of other offering costs (including in connection with the exercise of the over-allotment option). In addition, the underwriters agreed to defer $8,029,284 in underwriting discounts and commissions (including those attributable to the Units sold in connection with the exercise of the over-allotment option). 

 
For a description of the use of the proceeds generated in our Initial Public Offering, see Part I, Item 2 of this Quarterly Report.
 

 

Use of Proceeds

 

The registration statement for the Company’s Initial Public Offering was declared effective on August 3, 2021. On August 6, 2021, the Company consummated the Initial Public Offering of 22,940,811 units, including the issuance of 2,940,811 units as a result of the underwriters’ full exercise of their over-allotment option, at $10.00 per Unit, generating gross proceeds of $229,408,110. On August 16, 2021, the Underwriters partially exercised the over-allotment option and purchased an additional 2,940,811 Over-Allotment Units, generating additional gross proceeds of $229,480,110. Each Unit consisted of one Public Share and one-fourth of one redeemable Warrant. Each whole Public Warrant entitles the holder to purchase one Public Share for $11.50 per share, subject to adjustment.

 

Simultaneously with the closing of the Initial Public Offering, the Company consummated a private placement of 3,294,081 Warrants at a price of $2.00 per Private Placement Warrant to the Sponsor, generating gross proceeds of $6,588,162.

 

In connection with the Initial Public Offering, we incurred offering costs of $13,781,962 (including deferred underwriting commissions of approximately $8,029,284). Other incurred offering costs consisted principally of preparation fees related to the Initial Public Offering. After deducting the underwriting discounts and commissions (excluding the deferred portion, which amount will be payable upon consummation of the initial Business Combination, if consummated) and the Initial Public Offering expenses, $229,408,110 of the net proceeds from our Initial Public Offering and certain of the proceeds from the private placement of the Private Placement Warrants (or $10.00 per Unit sold in the Initial Public Offering) was placed in the Trust Account. The net proceeds of the Initial Public Offering and certain proceeds from the sale of the Private Placement Warrants are held in the Trust Account as described elsewhere in this Quarterly Report on Form 10-Q.

 

There has been no material change in the planned use of the proceeds from the Initial Public Offering and Private Placement as is described in the Company’s final prospectus related to the Initial Public Offering

 

For a description of the use of the proceeds generated in our Initial Public Offering, see Part I, Item 2 of this Quarterly Report.

 

Item 3. Defaults Upon Senior Securities

 
None.
 

 

None.

 

Item 4. Mine Safety Disclosures

 
Not applicable.
 
Item 5. Other Information
 
None.
 
 
 
23
 
 
 
 
 
 
 
Item 6. Exhibits.
 

 

Not applicable.

 

Item 5. Other Information

 

None.

 

28

 

 

Item 6. Exhibits.

 

The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on

Form 10-Q.
 
 

 

No.   Description of Exhibit
3.1   Amended and Restated Memorandum and Articles of Association (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on August 6, 2021)
     
31.1*   Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
   
31.2*   Certification of Principal Financial Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
   
32.1**   Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
   
32.2**   Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
   
101.INS*   XBRL Instance Document
   
101.CAL*   XBRL Taxonomy Extension Calculation Linkbase Document
   
101.SCH*   XBRL Taxonomy Extension Schema Document
   
101.DEF*   XBRL Taxonomy Extension Definition Linkbase Document
   
101.LAB*   XBRL Taxonomy Extension Labels Linkbase Document
   
101.PRE*   XBRL Taxonomy Extension Presentation Linkbase Document

 

 
 
 
 
 
** 
Filed herewith. 
 
 
**** 
Furnished.
 Furnished.
 

 

29

 
 
24
   
 
 
 
 
 
 
 
 
 
SIGNATURES
 

 

 

SIGNATURES

 

Pursuant to the requirements of Section 13 or 15(d) of the Securities Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. 

 
 

 

                          
 
  
Blue Whale Acquisition Corp I
Blue Whale Acquisition Corp I
   
Date: November May 23, 20212022     By:  

/s/ Maxime Franzetti

 

   Name:  Name: Maxime Franzetti
   Title:  Title: Chief Executive Officer and President
       (Principal Executive Officer)
   
Date: November May 23, 20212022     By:  

/s/ Russ Pillar

 

   Name:  Name: Russ PillarRuss Pillar
   Title:  Title: Chief Financial Officer
       (Principal Financial and Accounting Officer)
 

 

 
 
 
25
 
 

30

EXHIBIT 31.1  

EXHIBIT 31.1

CERTIFICATION  

PURSUANT CERTIFICATION

PURSUANT TO RULE 13a-14 AND 15d-14 

UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED

 

I, Maxime Franzetti, certify that: 

  

1.1. 

I have reviewed this Quarterly Report on Form 10-Q10-Q of Blue Whale Acquisition Corp I;

 

2.2. 

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.3. 

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4.4. 

The registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

 

 a)a) 

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

 b)b) 

[Paragraph omitted pursuant to SEC Release Nos. 33-8238/34-47986 and  and 33-8392/34-49313];

 

 c)c) 

Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

 d)d) 

Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and

 

5.5. 

The registrants other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions):

 

 (a)(a) 

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and

 

 (b)(b) 

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting.

 

Date: NovemberDate: May 23, 20212022  By:  By:  

/s/ Maxime Franzetti

   Name:  Name: Maxime Franzetti
   Title:  Title: Chief Executive Officer 
       (Principal Executive Officer)

 

 

EXHIBIT 31.2  

EXHIBIT 31.2

CERTIFICATION  

PURSUANT CERTIFICATION

PURSUANT TO RULE 13a-14 AND 15d-14 

UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED

I, Russ Pillar, certify that:  

I, Russ Pillar, certify that:

  

1.1. 

I have reviewed this Quarterly Report on Form 10-Q10-Q of Blue Whale Acquisition Corp I;

 

2.2. 

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.3. 

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4.4. 

The registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

 

 a)a) 

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

 b)b) 

[Paragraph omitted pursuant to SEC Release Nos. 33-8238/34-47986 and  and 33-8392/34-49313];

 

 c)c) 

Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

 d)d) 

Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and

 

5.5. 

The registrants other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions):

 

 (a)(a) 

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and

 

 (b)(b) 

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting.

 

Date: NovemberDate: May 23, 20212022  By:  By:  

/s/ Russ Pillar

 

     Russ PillarRuss Pillar
       Chief Financial Officer
       (Principal Financial and Accounting Officer)

 

 

EXHIBIT 32.1  

EXHIBIT 32.1

CERTIFICATION PURSUANT TO  

CERTIFICATION PURSUANT TO

18 U.S.C. 1350 

(SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002)

 

In connection with the Quarterly Report of Blue Whale Acquisition Corp I (the Company) on Form 10-Q for the quarter ended September 30March 31, 20212022, as filed with the Securities and Exchange Commission on the date hereof (the Report), I, Maxime Franzetti, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge: 

  

(1)(1) 

the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

(2)(2) 

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Date: NovemberDate: May 23, 20212022  By:  By:  

/s/ Maxime Franzetti

   Name:  Name: Maxime Franzetti
   Title:  Title: Chief Executive Officer
       (Principal Executive Officer)

 

 

 

EXHIBIT 32.2

CERTIFICATION PURSUANT TO  

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350 ,

(AS ADDED BY

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002)

 

In connection with the Quarterly Report of Blue Whale Acquisition Corp I (the Company) on Form 10-Q for the quarter ended September 30March 31, 20212022, as filed with the Securities and Exchange Commission on the date hereof (the Report), I, Russ Pillar, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge: 

  

(1)(1) 

the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

(2)(2) 

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Date: NovemberDate: May 23, 20212022  By:  By:  

/s/ Russ Pillar

       Russ Pillar
       Chief Financial Officer
       (Principal Financial and Accounting Officer)

 

 

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