NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Note 1 — Description
of Organization and Business Operations and Basis of Presentation
Global Synergy Acquisition Corp. (the “Company”)
was incorporated as a Cayman Islands exempted company on February 11, 2020. The Company was formed for the purpose of effecting a merger,
share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses (the “Initial
Business Combination”). The Company is an emerging growth company and, as such, the Company is subject to all of the risks associated
with emerging growth companies.
As of June 30, 2021, the Company had not commenced
any operations. All activity for the period from February 11, 2020 (inception) through June 30, 2021 relates to the Company’s formation,
the initial public offering described below and since the closing of the initial public offering, the search for a prospective Initial
Business Combination. The Company will not generate any operating revenues until after the completion of its Initial Business Combination,
at the earliest. The Company will generate non-operating income in the form of interest income on cash and cash equivalents from the proceeds
derived from the initial public offering (the “Initial Public Offering”). The Company has selected December 31 as its fiscal
year end.
The Company’s sponsor is Global Synergy
LLC, a Cayman Islands limited liability company (“Sponsor”). The registration statement for the Company’s Initial Public
Offering was declared effective on January 7, 2021. On January 12, 2021, the Company consummated its Initial Public Offering of 25,875,000
units (the “Units” and, with respect to the Class A ordinary shares included in the Units being offered, the “Public
Shares”), including 3,375,000 additional Units to cover over-allotments (the “Over-Allotment Units”), at $10.00 per
Unit, generating gross proceeds of approximately $258.8 million, and incurring offering costs of approximately $14.8 million, of which
approximately $9.1 million was for deferred underwriting commissions (Note 6).
Simultaneously with the closing of the Initial
Public Offering, the Company consummated the private placement (“Private Placement”) of 7,600,000 warrants (each, a “Private
Placement Warrant” and collectively, the “Private Placement Warrants”), at a price of $1.00 per Private Placement Warrant
with the Sponsor, generating gross proceeds of approximately $7.6 million (Note 4).
Upon the closing of the Initial Public
Offering and the Private Placement, approximately $258.8 million ($10.00 per Unit) of the net proceeds of the Initial Public
Offering and certain of the proceeds of the Private Placement were placed in a trust account (“Trust Account”) with
Continental Stock Transfer & Trust Company acting as trustee and invested in United States “government securities”
within the meaning of Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”),
having a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the
Investment Company Act which invest only in direct U.S. government treasury obligations, as determined by the Company, until the
earlier of: (i) the completion of an initial Business Combination and (ii) the distribution of the Trust Account as described
below.
The Company’s management has broad discretion
with respect to the specific application of the net proceeds of its Initial Public Offering and the sale of Private Placement Warrants,
although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. The Company’s
Initial Business Combination must be with one or more operating businesses or assets with a fair market value equal to at least 80% of
the net assets held in the Trust Account (excluding the deferred underwriting commissions and taxes payable on the interest earned on
the Trust Account) at the time the Company signs a definitive agreement in connection with the Initial Business Combination. However,
the Company will only complete a Business Combination if the post-transaction company owns or acquires 50% or more of the outstanding
voting securities of the target business or otherwise acquires a controlling interest in the target business sufficient for it not to
be required to register as an investment company under the Investment Company Act.
GLOBAL SYNERGY ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
The Company will provide the holders of the 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 general meeting called to approve the Business Combination or (ii) by means
of a tender offer. The decision as to whether the Company will seek shareholder approval of a Business Combination or conduct a tender
offer will be made by the Company. The Public Shareholders will be entitled to redeem their Public Shares for a pro rata portion of the
amount then in the Trust Account (initially anticipated to be $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 Public
Shareholders who redeem their Public Shares will not be reduced by the deferred underwriting commissions the Company will pay to Credit
Suisse Securities (USA) LLC and J.P. Morgan Securities LLC (collectively, the “Underwriters”) (as discussed in Note 6). These
Public Shares have been recorded at a redemption value and classified as temporary equity following the completion of the Initial Public
Offering, in accordance with Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.”
Accordingly, the Company will proceed with a Business Combination if the Company has net tangible assets of at least $5,000,001 upon such
consummation of a Business Combination and a majority of the shares are voted in favor of the Business Combination. If a shareholder vote
is not required by applicable law or stock exchange listing requirements and the Company does not decide to hold a shareholder vote for
business or other reasons, the Company will, pursuant to the amended and restated memorandum and articles of association which was adopted
by the Company upon the consummation of the Initial Public Offering (the “Amended and Restated Memorandum and Articles of Association”),
conduct the redemptions pursuant to the tender offer rules of the U.S. Securities and Exchange Commission (the “SEC”), and
file tender offer documents with the SEC prior to completing a Business Combination. If, however, a shareholder approval of the transactions
is required by applicable law or stock exchange listing requirements, or the Company decides to obtain shareholder approval for business
or other reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not
pursuant to the tender offer rules. Additionally, each Public Shareholder may elect to redeem their Public Shares irrespective of whether
they vote for or against the proposed transaction or whether they were a Public Shareholder on the record date for the general meeting
held to approve the proposed transaction. If the Company seeks shareholder approval in connection with a Business Combination, the holders
of the Founder Shares prior to this Initial Public Offering (the “Initial Shareholders”) have agreed to vote their Founder
Shares (as defined in Note 5) and any Public Shares purchased during or after the Initial Public Offering in favor of a Business Combination.
In addition, the Initial Shareholders have agreed to waive their redemption rights with respect to their Founder Shares and Public Shares
in connection with the completion of a Business Combination. In addition, the Company has agreed not to enter into a definitive agreement
regarding an Initial Business Combination without the prior consent of the Sponsor.
Notwithstanding the foregoing, the Company’s
Amended and Restated Memorandum and Articles of Association 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 redeeming its shares with respect to more
than an aggregate of 15% or more of the Class A ordinary shares sold in the Initial Public Offering, without the prior consent of the
Company.
The Company’s Sponsor, officers, and directors
agreed not to propose an amendment to the Company’s Amended and Restated Memorandum and Articles of Association (A) to modify the
substance or timing of the Company’s obligation to allow the redemption of its Public Shares in connection with a Business Combination
or to redeem 100% of its Public Shares if the Company does not complete a Business Combination within 18 months (or 24 months, as applicable)
from the closing of the Initial Public Offering or (B) with respect to any other provisions relating to shareholders’ rights or
pre-initial business combination activity, unless the Company provides the Public Shareholders with the opportunity to redeem their Class
A ordinary shares in conjunction with any such amendment.
If the Company is unable to complete a Business
Combination within 18 months (or 24 months, as applicable) 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 not more than
ten (10) business days thereafter, redeem the Public Shares, at a 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 the Company
to pay its income taxes, if any (less up to $100,000 of interest to pay dissolution expenses) divided by the number of the then-outstanding
Public Shares, which redemption will completely extinguish Public Shareholders’ rights as shareholders (including the right to receive
further liquidation distributions, if any); and (iii) as promptly as reasonably possible following such redemption, subject to the approval
of the remaining shareholders and the board of directors, liquidate and dissolve, subject in each case to the Company’s obligations
under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law.
GLOBAL SYNERGY ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
The Company may, by resolution of the board, extend
the period of time to consummate a Business Combination by an additional six months (for a total of 24 months to complete a Business Combination),
subject to the Sponsor depositing additional funds into the Trust Account as set out in Note 6.
In connection with the redemption of 100% of the
Company’s outstanding Public Shares for a portion of the funds held in the Trust Account, each holder will receive a full pro rata
portion of the amount then in the Trust Account, plus any pro rata interest earned on the funds held in the Trust Account and not previously
released to the Company to pay the Company’s taxes payable (less taxes payable and up to $100,000 of interest to pay dissolution
expenses).
The Initial Shareholders agreed to waive their
liquidation rights with respect to the Founder Shares if the Company fails to complete a Business Combination within the Combination Period.
However, if the Initial Shareholders should acquire Public Shares in or after the Initial Public Offering, they will be entitled to liquidating
distributions from the Trust Account with respect to such Public Shares 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 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 funds held in the Trust Account that will be available to fund the redemption of the Company’s
Public Shares. In the event of such distribution, it is possible that the per share value of the residual assets remaining available for
distribution in the Trust Account will be less than the $10.00 per share initially held in the Trust Account. In order to protect the
amounts held in the Trust Account, 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 other 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 date of the liquidation of the Trust Account, if less than $10.00 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 the 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 Underwriters of the Initial Public Offering against certain liabilities, including
liabilities under the Securities Act of 1933, as amended (the “Securities Act”). In the event that an executed waiver is deemed
to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims.
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 vendors, service providers (except the Company’s independent registered public accounting firm), 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. There can be no guarantee that the Company will be successful
in obtaining such waivers from its targeted vendors and service providers.
Basis of Presentation
The accompanying unaudited condensed financial
statements are presented in U.S. dollars in conformity with accounting principles generally accepted in the United States of America (“GAAP”)
for financial information and pursuant to the rules and regulations of the SEC. Accordingly, they do not include all of the information
and footnotes required by GAAP. In the opinion of management, the unaudited condensed financial statements reflect all adjustments, which
include only normal recurring adjustments necessary for the fair statement of the balances and results for the periods presented. Operating
results for the three and six months ended June 30, 2021 are not necessarily indicative of the results that may be expected through December
31, 2021.
The accompanying unaudited condensed financial
statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K and the final
prospectus filed by the Company with the SEC on March 30, 2021 and January 11, 2021, respectively.
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 of 2002 (“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.
GLOBAL SYNERGY ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
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 an emerging
growth 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. 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 that is neither an emerging growth company nor an emerging growth company that has opted
out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.
Liquidity and Capital
Resources
As of June 30, 2021, the Company had approximately
$929,000 in its operating bank account, respectively, as well as working capital of approximately $1.2 million.
The Company’s liquidity needs to date have
been satisfied through a payment of $25,000 from the Sponsor to cover certain expenses on behalf of the Company in exchange for the issuance
of the Founder Shares, the loan of $300,000 from the Sponsor pursuant to the Note (as defined in Note 5), and the proceeds from the consummation
of the Private Placement not held in the Trust Account. The Company repaid the Note in full upon consummation of the Initial Public Offering.
In addition, in order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor,
or certain of the Company’s officers and directors may, but are not obligated to, provide the Company Working Capital Loans (as
defined in Note 5). As of June 30, 2021 and December 31, 2020, the Company had no borrowings under the Working Capital Loans.
Based on the foregoing, management believes that
the Company will have sufficient working capital and borrowing capacity from the Sponsor or an affiliate of the Sponsor, or certain of
the Company’s officers and directors 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 the purpose of paying existing accounts payable,
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.
Note 2 — Summary
of Significant Accounting Policies
Use of Estimates
The preparation of these condensed financial statements
in conformity with GAAP requires the Company’s 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.
GLOBAL SYNERGY ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Cash and Cash Equivalents
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 no
cash equivalents as of June 30, 2021 and December 31, 2020.
Concentration of Credit Risk
Financial instruments
that potentially subject the Company to concentrations of credit risk consist of cash accounts in a financial institution, which, at times,
may exceed the Federal Depository Insurance Coverage limit of $250,000. As of June 30, 2021, the Company has not experienced losses on
these accounts and management believes the Company is not exposed to significant risks on such accounts.
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
unaudited condensed 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 income from investments held in Trust Account in the accompanying unaudited condensed statement
of operations. The estimated fair values of investments held in the Trust Account are determined using available market information.
Fair Value of Financial Instruments
The fair value of the Company’s assets and
liabilities which qualify as financial instruments under the FASB ASC Topic 820, “Fair Value Measurements,” equal or approximate
the carrying amounts represented in the condensed balance sheets.
Fair Value Measurements
Fair value is defined as the price that would
be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement
date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in 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:
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●
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Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets;
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●
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Level 2, defined as inputs other
than quoted prices in active markets included within Level 1 that are either directly or indirectly observable such as quoted prices
for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active;
and
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●
|
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.
|
In some circumstances, the inputs used to measure
fair value might be categorized within different levels of the fair value hierarchy. In those instances, the fair value measurement is
categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement.
GLOBAL SYNERGY ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Derivative Warrant Liabilities
The Company does not
use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its 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 FASB ASC Topic 815, “Derivatives and Hedging” (“ASC 815”). The
classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is reassessed
at the end of each reporting period.
The warrants issued
in connection with the Initial Public Offering (the “Public Warrants”) and the Private Placement Warrants are recognized
as derivative liabilities in accordance with ASC 815. Accordingly, the Company recognizes the warrant instruments as liabilities at
fair value and adjusts the instruments to fair value at each reporting period. The liabilities are subject to re-measurement 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 the Public Warrants issued in connection with the Initial Public Offering and Private Placement Warrants were
initially measured at fair value using a Monte Carlo simulation model. The fair value of Public Warrants issued in connection with
the Initial Public Offering have subsequently been measured based on the listed market price of such warrants. Subsequently, the
fair value of the Private Placement Warrants has been estimated by reference to the trading price of the Public Warrants.
Offering Costs
Associated with the Initial Public Offering
Offering costs consisted
of legal, accounting, underwriting fees and other costs incurred through the Initial Public Offering that were directly related to the
Initial Public Offering. Offering costs are allocated to the separable financial instruments issued in the Initial Public Offering based
on a relative fair value basis, compared to total proceeds received. Offering costs associated with warrant liabilities are expensed as
incurred and presented as non-operating expenses in the statement of operations. Offering costs associated with the Class A ordinary shares
were charged to shareholders’ equity upon the completion of the Initial Public Offering on January 12, 2021. The Company classifies
deferred underwriting commissions as non-current liabilities as their liquidation is not reasonably expected to require the use of current
assets or require the creation of current liabilities.
Class A Ordinary Shares Subject to Possible
Redemption
The Company accounts for its Class A ordinary
shares subject to possible redemption in accordance with the guidance in ASC Topic 480 “Distinguishing Liabilities from Equity.”
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 are classified as shareholders’ equity. 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 uncertain future events. Accordingly, at June 30, 2021 and December 31, 2020, respectively, 22,970,476 and 0 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.
Income Taxes
The Company complies with the accounting and reporting
requirements of ASC Topic 740, “Income Taxes”. ASC Topic 740 prescribes a recognition threshold and a measurement attribute
for the financial statement 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’s
management determined that the Cayman Islands is the Company’s only major tax jurisdiction. The Company recognizes accrued interest
and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued
for interest and penalties as of June 30, 2021 and December 31, 2020. 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 federal 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.
GLOBAL SYNERGY ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Net Income (Loss)
per Ordinary Share
The Company’s condensed statements of
operations include a presentation of net income (loss) per share for Class A redeemable ordinary shares subject to possible
redemption in a manner similar to the two-class method of net income (loss) per ordinary share. Net income (loss) per ordinary
share, basic and diluted, for Class A redeemable ordinary shares is calculated by dividing the interest income earned on the Trust
Account, less interest available to be withdrawn for the payment of taxes, by the weighted average number of Class A redeemable
ordinary shares outstanding for the periods. Net income (loss) per ordinary share, basic and diluted, for Class
B non-redeemable ordinary shares is calculated by dividing the net income (loss), adjusted for income attributable to Class A
redeemable ordinary shares, by the weighted average number of Class B non-redeemable ordinary
shares outstanding for the periods. Class B non-redeemable ordinary shares include the Founder Shares as these ordinary
shares do not have any redemption features and do not participate in the income earned on the Trust Account.
The calculation of diluted net income (loss)
per ordinary share does not consider the effect of the warrants issued in connection with the Initial Public Offering and the
Private Placement since the exercise of the warrants are contingent upon the occurrence of future events and
the exercise price of the warrants is in excess of the average ordinary share price for the period and as such, would not be
exercised.
The following table reflects the calculation of
basic and diluted net income (loss) per share of ordinary share:
|
|
For the
Three Months
Ended
June 30,
2021
|
|
|
For the
Six Months Ended
June 30,
2021
|
|
|
|
|
|
|
|
|
Class A redeemable ordinary shares
|
|
|
|
|
|
|
Numerator: Income allocable to Class A redeemable ordinary shares
|
|
|
|
|
|
|
Income from investments held in Trust Account
|
|
$
|
6,931
|
|
|
$
|
48,194
|
|
Less: Company’s portion available to be withdrawn to pay taxes
|
|
|
-
|
|
|
|
-
|
|
Net income attributable
|
|
$
|
6,931
|
|
|
$
|
48,194
|
|
Denominator: Weighted average Class A redeemable ordinary shares
|
|
|
|
|
|
|
|
|
Basic and diluted weighted average
shares outstanding, Class A redeemable ordinary shares
|
|
|
25,875,000
|
|
|
|
25,875,000
|
|
Basic and diluted net income per
share, Class A redeemable ordinary shares
|
|
$
|
0.00
|
|
|
$
|
0.00
|
|
|
|
|
|
|
|
|
|
|
Class B non-redeemable ordinary
shares
|
|
|
|
|
|
|
|
|
Numerator: Net income (loss) minus net income allocable
to Class A redeemable ordinary shares
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
|
(5,916,426
|
)
|
|
$
|
2,990,041
|
|
Net income allocable to Class A
redeemable ordinary shares
|
|
|
(6,931
|
)
|
|
|
(48,194
|
)
|
Net income (loss) attributable
|
|
$
|
(5,923,357
|
)
|
|
$
|
2,941,847
|
|
Denominator: weighted average Class B non-redeemable
ordinary shares - Basic
|
|
|
|
|
|
|
|
|
Basic weighted average
shares outstanding, Class B non-redeemable ordinary shares
|
|
|
6,468,750
|
|
|
|
6,417,472
|
|
Basic net loss per
share, Class B non-redeemable ordinary shares
|
|
$
|
(0.92
|
)
|
|
$
|
0.46
|
|
Diluted weighted average
shares outstanding, Class B non-redeemable ordinary shares
|
|
|
6,468,750
|
|
|
|
6,468,750
|
|
Diluted net loss per
share, Class B non-redeemable ordinary shares
|
|
$
|
(0.92
|
)
|
|
$
|
0.45
|
|
Recent Accounting
Standards
In August 2020, the FASB
issued Accounting Standards Update (“ASU”) No. 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): Accounting for Convertible Instruments and
Contracts in an Entity’s Own Equity (“ASU 2020-06”), which simplifies accounting for convertible instruments by
removing major separation models required under current GAAP. The ASU also removes certain settlement conditions that are required for
equity-linked contracts to qualify for the derivative scope exception, and it simplifies the diluted earnings per share calculation in
certain areas. The Company adopted ASU 2020-06 on January 1, 2021. Adoption of the ASU did not impact the Company’s financial position,
results of operations or cash flows.
GLOBAL SYNERGY ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
The Company’s management does not believe
that any other recently issued, but not yet effective, accounting standards if currently adopted would have a material effect on the accompanying
financial statements.
Note 3 — Initial
Public Offering
On January 12, 2021, the Company consummated its
Initial Public Offering of 25,875,000 Units, including 3,375,000 Over-Allotment Units, at $10.00 per Unit, generating gross proceeds of
approximately $258.8 million, and incurring offering costs of approximately $14.8 million, of which approximately $9.1 million was for
deferred underwriting commissions.
Each Unit consists of one Class A ordinary share
and one-half of one redeemable 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 share, subject to adjustment (see Note 7).
Note 4 — Private
Placement
Simultaneously with the closing of the Initial
Public Offering, the Company consummated the Private Placement of 7,600,000 Private Placement Warrants, at a price of $1.00 per Private
Placement Warrant with the Sponsor, generating gross proceeds of $7.6 million.
Each whole Private Placement Warrant is exercisable
for one whole Class A ordinary share at a price of $11.50 per share. A portion of the proceeds from the sale of the Private Placement
Warrants to the Sponsor was added to the proceeds from the Initial Public Offering held in the Trust Account. If the Company does not
complete a Business Combination within the Combination Period, the Private Placement Warrants will expire worthless. The Private Placement
Warrants will be non-redeemable except as described below in Note 7 and exercisable on a cashless basis so long as they are held by the
Sponsor or its permitted transferees.
The Sponsor and the Company’s officers and
directors agreed, subject to limited exceptions, not to transfer, assign or sell any of their Private Placement Warrants until 30 days
after the completion of the Initial Business Combination.
Note 5 — Related
Party Transactions
Founder Shares
On February 28, 2020, the Sponsor paid an aggregate
of $25,000 to cover for certain expenses on behalf of the Company in exchange for issuance of 5,750,000 Class B ordinary shares (the “Founder
Shares”). On September 11, 2020, the Company effected a share capitalization resulting in an aggregate of 6,468,750 Class B ordinary
shares issued and outstanding. All shares and associated amounts have been retroactively restated to reflect the share capitalization.
On December 10, 2020, the Sponsor transferred 25,000 Class B ordinary shares to each of the independent directors. The Sponsor agreed
to forfeit up to an aggregate of 843,750 Founder Shares to the extent that the option to purchase additional units was not exercised in
full by the Underwriters, so that the Founder Shares would represent 20% of the Company’s issued and outstanding ordinary shares
after the Initial Public Offering. On January 12, 2021, the Underwriters fully exercised the over-allotment option; thus, these Founder
Shares are no longer subject to forfeiture.
The Initial Shareholders agreed not to transfer,
assign or sell any of their Founder Shares until the earlier to occur of: (A) one year after the completion of the Initial Business Combination
and (B) subsequent to the Initial Business Combination, (x) if the closing price of Class A ordinary shares equals or exceeds $12.00 per
share (as adjusted for share splits, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within
any 30-trading day period commencing at least 150 days after the Initial Business Combination, or (y) the date on which the Company completes
a liquidation, merger, share exchange or other similar transaction that results in all of the Public Shareholders having the right to
exchange their ordinary shares for cash, securities or other property.
GLOBAL SYNERGY ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Related Party Loans
On February 28, 2020, the Sponsor agreed to loan
the Company up to $300,000 to be used for the payment of costs related to the Initial Public Offering pursuant to a promissory note (the
“Note”). The Note was non-interest bearing, unsecured and due upon the closing of the Initial Public Offering. At December
31, 2020, the Company had outstanding borrowings of $300,000 under the Note which was repaid upon the consummation of the Initial Public
Offering in January 2021. There was no amount outstanding at June 30, 2021 and December 31, 2020.
In addition, in order to fund working capital
deficiencies or finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain
of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working
Capital Loans”). If the Company completes a Business Combination, the Company may repay the Working Capital Loans out of the proceeds
of the Trust Account released to the Company. Otherwise, the Working Capital Loans may be repaid only out of funds held outside the Trust
Account. 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. The Working
Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lenders’ discretion,
up to $2.0 million of such Working Capital Loans may be convertible into warrants of the post Business Combination entity at a price of
$1.00 per warrant. The warrants would be identical to the Private Placement Warrants. Except for the foregoing, the terms of such Working
Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. To date, the Company has had
no borrowings under the Working Capital Loans.
In order for the time available for the Company
to consummate its Initial Business Combination to be extended, the Sponsor or its affiliates or designees, upon five (5) business days
advance notice prior to the expiration of the initial term, must deposit into the Trust Account approximately $2.6 million ($0.10 per
Unit) on or prior to the expiration of the initial term. Any such payment would be made in the form of non-interest bearing loans (“Extension
Loans”). If the Company completes its Initial Business Combination, the Company will, at the lender’s option, repay the Extension
Loans out of the proceeds of the Trust Account released to the Company or convert a portion or all of the total loan amount into warrants
at a price of $1.00 per warrant, which warrants will be identical to the Private Placement Warrants. If the Company does not complete
a Business Combination, the Company will repay the Extension Loans only from funds held outside of the Trust Account. The Sponsor or its
affiliates or designees are not obligated to fund the Trust Account to extend the time for the Company to complete its Initial Business
Combination.
Administrative Services Agreement
Commencing on the date that the
Company’s securities were first listed on the Nasdaq through the earlier of consummation of the Initial Business Combination
and the liquidation, the Company agreed to pay the Sponsor $10,000 per month for office space, administrative and support services.
The Company incurred approximately $30,000 and $56,000 of such expenses in the three and six-month period ending June 30, 2021,
included in general and administrative expenses on the unaudited condensed statement of operations, respectively of which $56,000
has been included as an accrued expense on the unaudited condensed balance sheet as of June 30, 2021.
In addition, the Sponsor, officers and directors,
or any of their respective affiliates will be reimbursed for any out-of-pocket expenses incurred in connection with activities on the
Company’s behalf such as identifying potential target businesses and performing due diligence on suitable Business Combinations.
The Company’s audit committee will review on a quarterly basis all payments that were made by the Company to the Sponsor, officers
or directors, or the Company’s affiliates. Any such payments prior to an Initial Business Combination will be made from funds held
outside the Trust Account.
GLOBAL SYNERGY ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Note 6 — Commitments
and Contingencies
Registration and Shareholder Rights
The holders of Founder Shares, Private Placement
Warrants and warrants that may be issued upon conversion of Working Capital Loans or Extension Loans, if any (and any Class A ordinary
shares issuable upon the exercise of the Private Placement Warrants and warrants that may be issued upon conversion of Working Capital
Loans and Extension Loans) are entitled to registration rights pursuant to a registration and shareholder rights agreement. These holders
will be entitled to certain demand and “piggyback” registration rights. However, the registration and shareholder rights agreement
provides that the Company will not permit any registration statement filed under the Securities Act to become effective until the termination
of the applicable lock-up period for the securities to be registered. 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 from the date of the final prospectus to purchase up to 3,375,000 additional Units at the Initial Public Offering price less the
underwriting discounts and commissions. On January 12, 2021, the Underwriters fully exercised the over-allotment option.
The Underwriters were entitled to an underwriting
discount of $0.20 per unit, or approximately $5.2 million in the aggregate, paid upon the closing of the Initial Public Offering. In addition,
$0.35 per unit, or approximately $9.1 million in the aggregate will be payable to the Underwriters for deferred underwriting commissions.
The deferred fee will become payable to the Underwriters from the amounts held in the Trust Account solely in the event that the Company
completes a Business Combination, subject to the terms of the underwriting agreement.
Note 7 —Warrants
As of June 30, 2021, the Company had 12,937,500
Public Warrants and 7,600,000 Private Warrants outstanding. As of December 31, 2020, the Company had no Public Warrants and no Private
Warrants outstanding.
Public Warrants may only be exercised for a whole
number of shares. No fractional Public Warrants will be issued upon separation of the Units and only whole Public Warrants will trade.
The Public Warrants will become exercisable on the later of (a) 30 days after the completion of a Business Combination and (b) 12 months
from the closing of the Initial Public Offering; provided in each case that the Company has an effective registration statement under
the Securities Act covering the Class A ordinary shares issuable upon exercise of the Public Warrants and a current prospectus relating
to them is available and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of
the state of residence of the holder (or the Company permit holders to exercise their warrants on a cashless basis under certain circumstances).
The Company has agreed that as soon as practicable, but in no event later than twenty (20) business days after the closing of the Initial
Business Combination, the Company will use commercially reasonable efforts to file with the SEC a registration statement covering the
Class A ordinary shares issuable upon exercise of the warrants and to maintain a current prospectus relating to those Class A ordinary
shares until the warrants expire or are redeemed, as specified in the warrant agreement. If a registration statement covering the Class
A ordinary shares issuable upon exercise of the warrants is not effective by the 60th day after the closing of the Initial 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. Notwithstanding the above, if the Class A ordinary shares are at the time of any exercise
of a warrant not listed on a national securities exchange such that they satisfy the definition of a “covered security” under
Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of Public Warrants who exercise their warrants
to do so on a “cashless basis” and, in the event the Company so elects, the Company will not be required to file or maintain
in effect a registration statement, and in the event the Company does not so elect, it will use commercially reasonable efforts to register
or qualify the shares under applicable blue sky laws to the extent an exemption is not available.
GLOBAL SYNERGY ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
The warrants have an exercise price of $11.50
per share, subject to adjustments, and will expire five years after the completion of a Business Combination or earlier upon redemption
or liquidation. In addition, if (x) the Company issues additional Class A ordinary shares or equity-linked securities for capital raising
purposes in connection with the closing of the Initial Business Combination at an issue price or effective issue price of less than $9.20
per ordinary share (with such issue price or effective issue price to be determined in good faith by the 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 Initial Business
Combination on the date of the consummation of the Initial Business Combination (net of redemptions), and (z) the volume weighted average
trading price of Class A 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 under “Redemption of warrants when the price per Class A ordinary share
equals or exceeds $18.00” and “Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00”
will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price, and the $10.00
per share redemption trigger price described under “Redemption of warrants when the price per Class A ordinary share equals or
exceeds $10.00” will be adjusted (to the nearest cent) to be equal to the higher of the Market Value and the Newly Issued Price.
The Private Placement Warrants are identical
to the Public Warrants underlying the Units sold in the Initial Public Offering, except (i) that the Private Placement Warrants and the
Class A ordinary shares issuable upon 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, (ii) except as described below, the Private
Placement Warrants will be non-redeemable so long as they are held by the Sponsor or its permitted transferees and (iii) the Sponsor
or its permitted transferees will have the option to exercise the Private Placement Warrants on a cashless basis and have certain registration
rights. If the Private Placement Warrants are held by someone other than the Sponsor or its permitted transferees, the Private Placement
Warrants will be redeemable by the Company in all redemption scenarios and exercisable by such holders on the same basis as the Public
Warrants.
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 outstanding warrants (except as described herein with respect to the Private Placement Warrants):
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in whole and not in part;
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at a price of $0.01 per warrant;
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●
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upon a minimum of 30 days’ prior written notice
of redemption to each warrant holder; and
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if, and only if, the last reported sale price (the
“closing price”) of Class A ordinary shares equals or exceeds $18.00 per share (as adjusted) for any 20 trading days
within a 30-trading day period ending on the third trading day prior to the date on which the Company sends the notice of redemption
to the warrant holders.
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The Company will not redeem the warrants as described
above unless an effective registration statement under the Securities Act covering the Class A ordinary shares issuable upon exercise
of the warrants is effective and a current prospectus relating to those Class A ordinary shares is available throughout the 30-day redemption
period.
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 outstanding warrants:
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in whole and not in part;
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at $0.10 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 Class A ordinary shares to be determined by reference to an agreed table based on the redemption date
and the “fair market value” of Class A ordinary shares;
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GLOBAL SYNERGY ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
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if, and only if, the closing price of Class A ordinary
shares equals or exceeds $10.00 per share (as adjusted) for any 20 trading days within the 30-trading day period ending three trading
days before the Company sends the notice of redemption to the warrant holders; and
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if the closing price of the Class A ordinary shares
for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which the Company sends
the notice of redemption to the warrant holders is less than $18.00 per share (as adjusted), the Private Placement Warrants must
also be concurrently called for redemption on the same terms as the outstanding Public Warrants, as described above.
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The “fair market value” of Class
A ordinary shares for the above purpose shall mean the volume weighted average price of Class A ordinary shares during the 10 trading
days immediately following the date on which the notice of redemption is sent to the holders of warrants. In no event will the warrants
be exercisable on a cashless basis in connection with this redemption feature for more than 0.361 Class A ordinary shares per warrant
(subject to adjustment).
In no event will the Company be required to net
cash settle any warrant. 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.
Note 8 — Shareholders’
Equity
Preference Shares — The Company
is authorized to issue 1,000,000 preference shares with a par value of $0.0001 per share. At June 30, 2021 and December 31, 2020, there
were no preference shares issued or outstanding.
Class A Ordinary Shares —
The Company is authorized to issue 400,000,000 Class A ordinary shares with a par value of $0.0001 per share. Holders of the Company’s
Class A ordinary shares are entitled to one vote for each share. At June 30, 2021, there were 2,904,524 Class A ordinary shares issued
or outstanding, excluding 22,970,476 Class A ordinary shares subject to possible redemption. At December 31, 2020, there were no Class
A ordinary shares issued or outstanding.
Class B Ordinary Shares —
The Company is authorized to issue 40,000,000 Class B ordinary shares with a par value of $0.0001 per share. On February 28, 2020, the
Company issued 6,468,750 Class B ordinary shares to the Sponsor, which amounts have been adjusted to reflect the share capitalization
as discussed in Note 5. Of the 6,468,750 Class B ordinary shares outstanding, up to 843,750 Class B ordinary shares were subject to forfeiture
to the Company by the Initial Shareholders for no consideration to the extent that the Underwriters’ over-allotment option was
not exercised in full or in part, so that the Initial Shareholders would collectively own 20% of the Company’s issued and outstanding
ordinary shares after the Initial Public Offering. On January 12, 2021, the Underwriters fully exercised the over-allotment option; thus,
these 843,750 Class B ordinary shares are no longer subject to forfeiture.
Ordinary shareholders of record are entitled
to one vote for each share held on all matters to be voted on by shareholders. Except as described below, holders of Class A ordinary
shares and holders of Class B ordinary shares will vote together as a single class on all matters submitted to a vote of the shareholders
except as required by law.
The Class B ordinary shares will automatically
convert into Class A ordinary shares at the time of the Initial Business Combination or earlier at the option of the holders thereof
at a ratio such that the number of Class A ordinary shares issuable upon conversion of all Founder Shares will equal, in the aggregate,
on an as-converted basis, 20% of the sum of (i) the total number of ordinary shares issued and outstanding upon completion of the Initial
Public Offering, plus (ii) the total number of Class A ordinary shares issued or deemed issued or issuable upon conversion or exercise
of any equity-linked securities (as defined herein) or rights issued or deemed issued, by the Company in connection with or in relation
to the consummation of the Initial Business Combination, 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
and any Private Placement Warrants issued to the Sponsor, its affiliates or any member of the Company’s management team upon conversion
of Working Capital Loans or extension loans, if any. In no event will the Class B ordinary shares convert into Class A ordinary shares
at a rate of less than one-to-one.
GLOBAL SYNERGY ACQUISITION CORP.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Note 9 — Fair Value Measurements
The following table presents information about
the Company’s assets and liabilities that are measured at fair value on a recurring basis as of June 30, 2021 and indicates the
fair value hierarchy of the valuation techniques that the Company utilized to determine such fair value.
Description
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Quoted Prices in Active Markets
(Level 1)
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Significant Other Observable Inputs
(Level 2)
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Significant Other Unobservable Inputs
(Level 3)
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Assets:
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Investments held in Trust Account
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$
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258,798,193
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$
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-
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$
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-
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Liabilities:
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Derivative warrant liabilities
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$
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10,220,630
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$
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6,004,000
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$
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-
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There were no assets
and liabilities measured at fair value on a recurring basis at December 31, 2020.
Transfers to/from
Levels 1, 2, and 3 are recognized at the beginning of the reporting period. The estimated fair value of the Public Warrants
were transferred from a Level 3 measurement to a Level 1 fair value measurement, and the fair value of the Private Warrants were
transferred to a Level 2 measurement in March 2021 when the Public Warrants were separately listed and traded.
Level 1 instruments
include investments in mutual funds invested in government securities. 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 fair value of
the Public Warrants issued in connection with the Initial Public Offering and Private Placement Warrants were initially measured at
fair value using a Monte Carlo simulation model and subsequently, the fair value of the Private Placement Warrants has been
estimated by reference to the listing price of the Public Warrants at each measurement date, a Level 2 measurement. The fair value
of Public Warrants issued in connection with the Initial Public Offering has been measured based on the listed market price of such
warrants, a Level 1 measurement, since March 2021. For the three months ended June 30, 2021, the Company recognized a loss
of approximately $5.5 million resulting from an increase in the fair value of derivative
warrant liabilities, presented as change in the fair value of derivative warrant liabilities on the condensed statement of
operations. In the six months ended, the Company recognized income of approximately $4.3 million resulting from a decrease in the
fair value of the derivative warrant liabilities, presented as change in fair value of derivative warrant liabilities on the
accompanying unaudited condensed statement of operations.
The change in the fair
value of derivative warrant liabilities measured with Level 3 inputs for the three and six-month period ended June 30, 2021 is summarized
as follows:
Level 3 - Derivative warrant liabilities at December 31, 2020
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$
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-
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Issuance of Public and Private Warrants
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20,537,500
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Transfer of Public Warrants out of level 3 to Level 1
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(12,937,500
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)
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Transfer of Private Warrants out of level 3 to Level 2
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(7,600,000
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)
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Level 3 - Derivative warrant liabilities at March 31, 2021
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$
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-
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Note 10 — Subsequent
Events
Management has evaluated subsequent events and
transactions that occurred after the balance sheet date through the date the balance sheet was issued. Based upon this review the Company
did not identify any subsequent events that would have required adjustment or disclosure in the financial statements.