NOTES TO UNAUDITED CONDENSED FINANCIAL
STATEMENTS (AS RESTATED)
NOTE 1 - DESCRIPTION OF ORGANIZATION
AND BUSINESS OPERATIONS
JAWS Juggernaut Acquisition Corporation
(the “Company”) was incorporated as a Cayman Islands exempted company on December 16, 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 or entities (the “Business Combination”). The Company is not limited to a particular industry or sector
for purposes of consummating a Business Combination. The Company is an “emerging growth company,” as defined in Section 2(a)
of the Securities Act of 1933, as amended (the “Securities Act”), as modified by the Jumpstart Our Business Startups Act
of 2012 (the “JOBS Act”) 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, the Company
had not yet commenced operations. All activity for the period from December 16, 2020 (inception) through September 30, 2021, relates
to the Company’s formation and the initial public offering (the “Initial Public Offering”) described below, and, subsequent
to the Initial Public Offering, identifying a target company for a Business Combination. The Company will not generate any operating
revenues until after the completion of its initial Business Combination, at the earliest. The Company generates non-operating income
in the form of interest income on investments held in trust from the proceeds of its Initial Public Offering. The Company has selected
December 31 as its fiscal year end.
The Company’s sponsor is Juggernaut
Sponsor LLC, a Delaware limited liability company and an affiliate of JAWS Estates Capital (the “Sponsor”). The registration
statement for the Company’s Initial Public Offering was declared effective on June 17, 2021. On June 22, 2021, the Company consummated
its Initial Public Offering of 27,600,000 units (the “Units” and, with respect to the Class A ordinary shares included in
the Units being offered, the “Public Shares”), which included the full exercise of the underwriters’ option to purchase
an additional 3,600,000 Units to cover over-allotments, at $10.00 per Unit, generating gross proceeds of $276.0 million, and incurring
offering costs of approximately $15.6 million, of which approximately $761,000 was offering costs allocated to the derivate warrant liabilities,
and approximately $9.7 million was for deferred underwriting commissions (see Note 5).
Prior to the closing of the Initial
Public Offering, the Sponsor purchased an aggregate of 6,900,000 Class B ordinary shares and 3,760,000 private placement warrants (“Private
Placement Warrants”) which generated gross proceeds to the Company of $7,545,000 (the “Private Placement”).
Upon the closing of the Initial Public
Offering and the Private Placement, $276.0 million ($10.00 per Unit) of the net proceeds of the sale of the Units in the Initial Public
Offering and of the Private Placement Warrants in the Private Placement were placed in a trust account (“Trust Account”)
and were 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 investing solely
in U.S. Treasuries and meeting certain conditions under Rule 2a-7 of the Investment Company Act of 1940, as amended (the “Investment
Company Act”), as determined by the Company, until the earliest of: (i) the completion of a Business Combination and (ii) the distribution
of the funds in the Trust Account to the Company’s shareholders, as described below.
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. The stock exchange listing rules require that the Business Combination must be with one or more operating businesses or
assets with a fair market value equal to at least 80% of the assets held in the Trust Account (excluding the amount of deferred underwriting
commissions and taxes payable on the interest earned on the Trust Account). The Company will only complete a Business Combination if
the post-Business Combination company owns or acquires 50% or more of the issued and outstanding voting securities of the target 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. There is no assurance that the Company will be able to successfully effect a Business Combination.
JAWS JUGGERNAUT ACQUISITION CORPORATION
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 the 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, solely in its discretion. The Public Shareholders will be entitled to redeem their
Public Shares, equal to the aggregate amount then on deposit in the Trust Account, calculated as of two business days prior to the consummation
of the Business Combination (initially at $10.00 per Public 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) divided by the number of then issued and outstanding Public Shares,
subject to certain limitations as described in the prospectus. The per-share amount to be distributed to the Public Shareholders who
properly redeem their shares will not be reduced by the deferred underwriting commissions the Company will pay to the underwriter (as
discussed in Note 5). There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s
warrants. The Class A ordinary shares subject to possible redemption were recorded at redemption value and classified as temporary equity,
in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”)
Topic 480 “Distinguishing Liabilities from Equity (“ASC 480”).
The Company will proceed with a Business
Combination only if the Company has net tangible assets of at least $5,000,001 and, if the Company seeks shareholder approval, it receives
an ordinary resolution under Cayman Islands law approving a Business Combination, which requires the affirmative vote of a majority of
the shareholders who attend and vote at a general meeting of the Company. 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 Amended and Restated Memorandum
and Articles of Association, conduct the redemptions pursuant to the tender offer rules of the Securities and Exchange Commission (“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. If the Company seeks shareholder approval in connection with a Business Combination, the
Sponsor agreed to vote its Founder Shares (as defined in Note 4) and any Public Shares purchased during or after the Initial Public Offering
in favor of approving a Business Combination. Additionally, each Public Shareholder may elect to redeem their Public Shares, without
voting, and if they do vote, irrespective of whether they vote for or against a proposed Business Combination.
Notwithstanding the foregoing, if the
Company seeks shareholder approval of the Business Combination and the Company does not conduct redemptions pursuant to the tender offer
rules, 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% of the Public Shares without
the Company’s prior written consent.
The Sponsor agreed (a) to waive its
redemption rights with respect to any Founder Shares (as defined in Note 4) and Public Shares held by it in connection with the completion
of a Business Combination and (b) not to propose an amendment to the Amended and Restated Memorandum and Articles of Association (i)
to modify the substance or timing of the Company’s obligation to allow redemption in connection with the Company’s initial
Business Combination or to redeem 100% of the Public Shares if the Company does not complete a Business Combination within the Combination
Period (as defined below) or (ii) with respect to any other provision relating to shareholders’ rights or pre-initial business
combination activity, unless the Company provides the Public Shareholders with the opportunity to redeem their Public Shares upon approval
of any such amendment 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 Trust Account and not previously released to pay taxes, divided by the number of then issued and outstanding Public
Shares.
The Company will have until 24 months
from the closing of the Initial Public Offering, or June 22, 2023, to consummate a Business Combination (the “Combination Period”).
However, if the Company has not completed a Business Combination within 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 business days thereafter, redeem
100% of 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 and not previously released to us to pay our taxes, if any (less up to $100,000 of interest to pay dissolution
expenses), divided by the number of then issued and outstanding Public Shares, which redemption will completely extinguish the rights
of the Public Shareholders as shareholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly
as reasonably possible following such redemption, subject to the approval of the Company’s remaining Public Shareholders and its
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. There will be no redemption rights or liquidating distributions
with respect to the Company’s warrants, which will expire worthless if the Company fails to complete a Business Combination within
the Combination Period.
JAWS JUGGERNAUT ACQUISITION CORPORATION
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
The Sponsor agreed to waive its rights
to liquidating distributions from the Trust Account with respect to the Founder 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 underwriter agreed to waive its right to its deferred underwriting commission (see Note 5) 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 Initial Public Offering price per Unit ($10.00).
In order to protect the amounts held
in the Trust Account, the Sponsor agreed that it will be liable to the Company if and to the extent any claims by a third party (other
than the Company’s independent registered public accounting firm) for services rendered or products sold to the Company, or a prospective
target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account
to below the lesser of (1) $10.00 per Public Share and (2) 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 Public Share, due to reductions in the value of trust assets, in each
case net of the interest that may be withdrawn to pay taxes. This liability will not apply to any claims by a third party who executed
a waiver of any and all rights to seek access to the Trust Account and as to any claims under the Company’s indemnity of the underwriter
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 all vendors, service providers (other than 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.
Liquidity and Capital Resources
As of September 30, 2021, the Company
had approximately $941,000 million in its operating bank account and working capital of approximately $968,000.
The Company’s liquidity needs
prior to the consummation of the Initial Public Offering were satisfied through contribution from the Sponsor in exchange for issuance
of Founder Shares (as defined in Note 4) and Private Placement Warrants, and a loan from the Sponsor of approximately $174,000 under
the Note (as defined in Note 4). The Company repaid the Note in full on June 23, 2021, at which date the Note was terminated. Subsequent
to the consummation of the Initial Public Offering, the Company’s liquidity has been satisfied through the net proceeds from the
consummation of the Initial Public Offering and the Private Placement held outside of the Trust Account. 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 4). 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 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, the Company will be using the funds held outside of the
Trust Account for 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 - BASIS OF PRESENTATION AND
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (as restated)
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 normal recurring adjustments, necessary for the fair statement of the balances and results for
the period presented. Operating results for the three and nine months ended September 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 final prospectus filed
by the Company with the SEC on June 21, 2021.
JAWS JUGGERNAUT ACQUISITION CORPORATION
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Restatement of Previously
Reported Financial Statements
In preparation of the Company’s unaudited
condensed financial statements as of and for quarterly period ended September 30, 2021, the Company concluded it should restate its financial
statements to classify all Class A ordinary shares subject to possible redemption in temporary equity and restate its presentation of
earnings per share. 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 require ordinary shares subject to redemption to be classified outside
of permanent equity. The Company had previously classified a portion of its Class A ordinary shares in permanent equity, or total shareholders’
equity. Although the Company did not specify a maximum redemption threshold, its charter currently provides that, the Company will not
redeem its public shares in an amount that would cause its net tangible assets to be less than $5,000,001. Previously, the Company presented
a portion of its Class A ordinary shares sold in its initial public offering as permanent equity to maintain shareholders’ equity
greater than $5,000,000 on the basis that the Company will consummate its initial business combination only if the Company has net tangible
assets of at least $5,000,001. After discussion and evaluation, the Company has concluded that all of its redeemable Class A ordinary
shares should be classified as temporary equity regardless of the minimum net tangible assets required by the Company to complete its
initial business combination. Accordingly, effective with this filing, the Company presents all redeemable Class A ordinary shares as
temporary equity and recognized accretion from the initial book value to redemption value at the time of its Initial Public Offering
and in accordance with ASC 480. In connection with the change in presentation for the Class A ordinary shares subject to possible redemption,
the Company restated its earnings per share calculation to allocate income and losses share pro rata between the the two classes of shares.
This presentation contemplates a Business Combination as the most likely outcome, in which case, both classes of shares participate pro
rata in the income and losses of the Company.
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 statements that contained the error, reported in the Company’s
Form 10-Q for the quarterly period ended June 30, 2021 (the “Affected Quarterly Period”). Therefore, the Company, in consultation
with its Audit Committee, concluded that the Affected Quarterly 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 and restate earnings per share. As such, the Company is reporting these restatements to those periods in
this quarterly report.
Impact of the Restatement
The table below presents the effect of the
financial statement adjustments related to the restatement discussed above of the Company’s previously reported balance sheet as
of June 30, 2021:
As of June 30, 2021 (unaudited)
|
|
As Reported
|
|
|
Adjustment
|
|
|
As Restated
|
|
Total assets
|
|
$
|
278,450,132
|
|
|
$
|
(1
|
)
|
|
$
|
278,450,131
|
|
Total liabilities
|
|
$
|
31,620,317
|
|
|
|
|
|
|
$
|
31,620,317
|
|
Class A ordinary shares subject to possible redemption
|
|
|
241,829,810
|
|
|
|
34,170,190
|
|
|
|
276,000,000
|
|
Class A ordinary shares
|
|
|
342
|
|
|
|
(342
|
)
|
|
|
-
|
|
Class B ordinary shares
|
|
|
690
|
|
|
|
-
|
|
|
|
690
|
|
Additional paid-in capital
|
|
|
6,026,329
|
|
|
|
(6,026,329
|
)
|
|
|
-
|
|
Accumulated deficit
|
|
|
(1,027,356
|
)
|
|
|
(28,143,520
|
)
|
|
|
(29,170,876
|
)
|
Total shareholders’ equity (deficit)
|
|
$
|
5,000,005
|
|
|
$
|
(34,170,191
|
)
|
|
$
|
(29,170,186
|
)
|
Total Liabilities, Class A ordinary
shares Subject to Possible Redemption and Shareholders’ Equity (Deficit)
|
|
$
|
278,450,132
|
|
|
$
|
(1
|
)
|
|
$
|
278,450,131
|
|
Shares of Class A ordinary shares subject to possible redemption
|
|
|
24,182,981
|
|
|
|
3,417,019
|
|
|
|
27,600,000
|
|
Shares of Class A non-redeemable ordinary share
|
|
|
3,417,019
|
|
|
|
(3,417,019
|
)
|
|
|
-
|
|
The Company’s statements of changes
in shareholders’ deficit has been restated to reflect the changes to the impacted shareholders’ deficit accounts described
above.
The table below presents the effect of the financial
statement adjustments related to the restatement discussed above of the Company’s previously reported statement of cash flows for
the six months ended June 30, 2021:
Six months ended June 30, 2021 (unaudited)
|
|
As Reported
|
|
|
Adjustment
|
|
|
As Restated
|
|
Supplemental Disclosure of Noncash Financing Activities:
|
|
|
|
|
|
|
|
|
|
Initial value of Class A ordinary share subject to possible redemption
|
|
$
|
242,066,480
|
|
|
$
|
(242,066,480
|
)
|
|
$
|
-
|
|
Change in initial value of class a shares subject to possible redemption
|
|
$
|
(236,670
|
)
|
|
$
|
236,670
|
|
|
$
|
-
|
|
JAWS JUGGERNAUT ACQUISITION CORPORATION
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
The impact to the reported amounts of weighted
average shares outstanding and basic and diluted earnings per ordinary share is presented below for the Affected Quarterly Periods:
|
|
Earnings (Loss) Per Share
|
|
|
|
As Reported
|
|
|
Adjustment
|
|
|
As Adjusted
|
|
Three months ended June 30, 2021 (unaudited)
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(1,003,376
|
)
|
|
$
|
-
|
|
|
$
|
(1,003,376
|
)
|
Weighted average shares outstanding - Class A ordinary shares
|
|
|
27,600,000
|
|
|
|
(24,870,330
|
)
|
|
|
2,729,670
|
|
Basic and diluted earnings per share - Class A ordinary shares
|
|
$
|
0.00
|
|
|
$
|
(0.11
|
)
|
|
$
|
(0.11
|
)
|
Weighted average shares outstanding - Class B ordinary shares
|
|
|
6,089,011
|
|
|
|
-
|
|
|
|
6,089,011
|
|
Basic and diluted loss per share - Class B ordinary shares
|
|
$
|
(0.16
|
)
|
|
$
|
0.05
|
|
|
$
|
(0.11
|
)
|
Six months ended June 30, 2021 (unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(1,016,684
|
)
|
|
$
|
-
|
|
|
$
|
(1,016,684
|
)
|
Weighted average shares outstanding - Class A ordinary shares
|
|
|
27,600,000
|
|
|
|
(26,066,667
|
)
|
|
|
1,533,333
|
|
Basic and diluted earnings per share - Class A ordinary shares
|
|
$
|
0.00
|
|
|
$
|
(0.13
|
)
|
|
$
|
(0.13
|
)
|
Weighted average shares outstanding - Class B ordinary shares
|
|
|
6,049,693
|
|
|
|
-
|
|
|
|
6,049,693
|
|
Basic and diluted loss per share - Class B ordinary shares
|
|
$
|
(0.17
|
)
|
|
$
|
0.04
|
|
|
$
|
(0.13
|
)
|
Emerging Growth Company
The Company is an “emerging growth
company,” as defined in Section 2(a) of the Securities Act, as modified by 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 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 unaudited condensed 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.
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 Deposit Insurance Corporation coverage limit of $250,000. As of September 30, 2021, and December 31, 2020, the Company has
not experienced losses on these accounts and management believes the Company is not exposed to significant risks on such accounts.
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 September 30, 2021, and December 31, 2020.
Investments Held in Trust Account
The Company’s portfolio of investments
is comprised 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 and generally have a readily determinable
fair value, or a combination thereof. When the Company’s investments held in the Trust Account are comprised of U.S. government
securities, the investments are classified as trading securities. When the Company’s investments held in the Trust Account are
comprised of money market funds, the investments are recognized at fair value. Trading securities and investments in money market funds
are presented on the balance sheets 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 or loss from investments held in Trust Account in the accompanying unaudited condensed
statements of operations. The estimated fair values of investments held in the Trust Account are determined using available market information.
JAWS JUGGERNAUT ACQUISITION CORPORATION
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Use of Estimates
The preparation of 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 unaudited condensed 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 unaudited condensed financial statements, which management considered in formulating its estimate, could
change in the near term due to one or more future confirming events. Such estimates may be subject to change as more current information
becomes available; accordingly, the actual results could differ significantly from those estimates.
Fair Value of Financial Instruments
The fair value of the Company’s
assets and liabilities which qualify as financial instruments under FASB ASC Topic 820, “Fair Value Measurements,” equal
or approximate the carrying amounts represented in the balance sheet due to their short-term nature.
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 consist of:
|
●
|
Level 1, defined as observable
inputs such as quoted prices (unadjusted) for identical instruments in active markets;
|
|
●
|
Level 2, defined as inputs
other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly; and
|
|
●
|
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.
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 Public Offering and Private Placement Warrants were initially measured at fair value using a Black-Scholes Option
Pricing Method (the “BSM”). As of September 30, 2021, the fair value of the Public Warrants is based on their listed trading
price and the fair value of the Private Placement Warrants is measured by reference to the listed trading price of the Public Warrants.
The determination of the fair value of the warrant liabilities may be subject to change as more current information becomes available
and accordingly the actual results could differ significantly. Derivative warrant liabilities are classified 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.
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,
presented as non-operating expenses in the condensed statement of operations. Offering costs associated with the Public Share were charged
to the carrying value of the Class A ordinary shares subject to possible redemption upon the completion of the Initial Public Offering.
The Company classifies deferred underwriting commissions are non-current liabilities as their liquidation is not reasonably expected
to require the use of current assets or require the creation of current liabilities.
JAWS JUGGERNAUT ACQUISITION CORPORATION
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
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 480. 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, 27,600,000 Class A ordinary shares subject to possible redemption are presented as temporary equity, outside
of the shareholders’ equity section of the Company’s unaudited condensed balance sheet. There were no Class A ordinary shares
issued or outstanding at December 31, 2020.
Under ASC 480-10-S99, the Company has elected to recognize changes in the redemption value immediately as they occur and adjust the carrying
value of the security to equal the redemption value at the end of the reporting period. This method would view the end of the reporting
period as if it were also the redemption date of the security. Effective with the closing of the Initial
Public Offering, the Company recognized the accretion from initial book value to redemption amount, which resulted in charges against
additional paid-in capital (to the extent available) and accumulated deficit.
Income Taxes
FASB ASC Topic 740, “Income Taxes”,
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. There were no unrecognized tax benefits as of September 30, 2021. 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. No amounts were accrued for the payment of interest and penalties
as of September 30, 2021, or 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. The Company is subject to income tax examinations by major taxing authorities
since inception.
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 unaudited condensed 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.
Net Income (Loss) Per Ordinary
Share
The Company complies with accounting
and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share.” The Company has two classes of shares, which are
referred to as Class A ordinary shares and Class B ordinary shares. Income and losses are shared pro rata between the two classes of
shares. Net income (loss) per ordinary share is calculated by dividing the net income (loss) by the weighted average shares of ordinary
shares outstanding for the respective period.
The calculation of diluted net income per ordinary shares does not consider the effect of the warrants issued in connection with the Initial Public Offering (including
exercise of the over-allotment option) and the Private Placement to purchase an aggregate of 10,660,000 Class A ordinary shares since
their exercise is contingent upon future events. The Company has considered the effect of Class B ordinary shares that were excluded
from the weighted average number of basic shares outstanding as they were contingent on the exercise of the over-allotment option by
the underwriters. Since the contingency was satisfied, the Company has included these shares in the weighted average number as of the
beginning of the interim period to determine the dilutive impact of these shares. Accretion associated with the redeemable Class A ordinary
shares is excluded from earnings per share as the redemption value approximates fair value.
JAWS JUGGERNAUT ACQUISITION CORPORATION
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
The following table presents
a reconciliation of the numerator and denominator used to compute basic and diluted net income per share for each class of ordinary shares:
|
|
Three Months Ended
September 30, 2021
|
|
|
Nine Months Ended
September 30, 2021
|
|
|
|
Class A
|
|
|
Class B
|
|
|
Class A
|
|
|
Class B
|
|
Basic and diluted net income (loss) per ordinary share:
|
|
|
|
|
|
|
|
|
|
|
|
|
Numerator:
|
|
|
|
|
|
|
|
|
|
|
|
|
Allocation of net income - basic
|
|
$
|
6,240,722
|
|
|
$
|
1,560,181
|
|
|
$
|
4,289,824
|
|
|
$
|
2,494,395
|
|
Allocation of net income - diluted
|
|
$
|
6,240,722
|
|
|
$
|
1,560,181
|
|
|
$
|
4,159,066
|
|
|
$
|
2,625,153
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Denominator:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic weighted average ordinary shares outstanding
|
|
|
27,600,000
|
|
|
|
6,900,000
|
|
|
|
10,931,765
|
|
|
|
6,356,471
|
|
Diluted weighted average ordinary shares outstanding
|
|
|
27,600,000
|
|
|
|
6,900,000
|
|
|
|
10,931,765
|
|
|
|
6,900,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net income per ordinary share
|
|
$
|
0.23
|
|
|
$
|
0.23
|
|
|
$
|
0.39
|
|
|
$
|
0.39
|
|
Diluted net income per ordinary share
|
|
$
|
0.23
|
|
|
$
|
0.23
|
|
|
$
|
0.38
|
|
|
$
|
0.38
|
|
Recent Accounting Pronouncements
In August 2020, the FASB issued Accounting
Standard 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.
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 unaudited condensed financial statements.
NOTE 3 - INITIAL PUBLIC OFFERING
On June 22, 2021, the Company consummated
its Initial Public Offering of 27,600,000 Units, which included the full exercise of the underwriters’ option to purchase an additional
3,600,000 Units to cover over-allotments, at $10.00 per Unit, generating gross proceeds of $276.0 million, and incurring offering costs
of approximately $15.6 million, of which approximately $761,000 were offering costs allocated to the derivative warrant liabilities and
approximately $9.7 million was for deferred underwriting commissions.
Each Unit consists of one Class A ordinary
share, and one-fourth of one redeemable Public Warrant. Each Public Warrant entitles the holder to purchase one Class A ordinary share
at a price of $11.50 per share, subject to adjustment (see Note 8).
NOTE 4 - RELATED PARTY TRANSACTIONS
Founder Shares and Private Placement
Warrants
On January 19, 2021, the Sponsor purchased
5,750,000 Class B ordinary shares (the “Founder Shares”) and 3,300,000 Private Placement Warrants for an aggregate purchase
price of $6,625,000. On June 22, 2021, the Sponsor purchased 460,000 additional Private Placement Warrants, increasing the aggregate
purchase price for the Class B ordinary shares and Private Placement Warrants to $7,545,000. In addition, on June 22, 2021, the Company
effected a share dividend with respect to Class B ordinary shares, resulting in an aggregate of 6,900,000 Class B ordinary shares outstanding.
The Founder Shares included an aggregate of up to 900,000 shares that were subject to forfeiture in the event that, and to the extent
to which, the underwriter’s option to purchase additional Units was exercised, so that the number of Founder Shares would equal,
on an as-converted basis, approximately 20% of the Company’s issued and outstanding ordinary shares after the Initial Public Offering.
The underwriters fully exercised the over-allotment on June 22, 2021; thus, these 900,000 Founder Shares were no longer subject to forfeiture.
JAWS JUGGERNAUT ACQUISITION CORPORATION
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Each Private Placement Warrant is exercisable
to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment (see Note 6). A portion of the proceeds
from the Private Placement Warrants 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 proceeds from the sale of the Private Placement Warrants
will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Placement Warrants
will expire worthless.
The Sponsor agreed, subject to limited
exceptions, not to transfer, assign or sell any of the Founder Shares until the earliest of: (A) one year after the completion of a Business
Combination and (B) subsequent to a Business Combination, (x) if the closing price of the Class A ordinary shares equals or exceeds $12.00
per share (as adjusted for share sub-divisions, share dividends, rights issuances, reorganizations, recapitalizations and the like) for
any 20 trading days within any 30-trading day period commencing at least 150 days after a 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 Class A ordinary shares for cash, securities or other property.
Promissory Note - Related Party
On January 19, 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”). This Note was non-interest bearing and payable upon the completion of the Initial Public Offering. The
Company borrowed approximately $174,000 under the Note and repaid the Note in full on June 23, 2021, at which date the Note was terminated.
Related Party Loans
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, 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 the 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. 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. The
Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s
discretion, up to $1.5 million of such Working Capital Loans may be convertible into warrants of the post Business Combination entity
at a price of $2.00 per warrant. The warrants would be identical to the Private Placement Warrants. As of September 30, 2021, and December
31, 2020, the Company had no borrowings under the Working Capital Loans.
Administrative Support Agreement
The Company entered into an agreement
to pay its Sponsor a total of $10,000 per month for office space, secretarial and administrative services provided to the Company commencing
on the Company’s registration statement for the Initial Public Offering through the earlier of consummation of the initial Business
Combination or the Company’s liquidation.
For the three and nine months ended
September 30, 2021, the Company incurred approximately $30,000 and $33,000, respectively, in such fees which is included in the condensed
statement of operations as general and administrative fees - related party. As of September 30, 2021, there were no amounts payable for
these fees.
Due to Related Party
As of December 31, 2020, the Sponsor
paid $5,563 on behalf of the Company to cover certain general and administrative expenses.
During the nine months ended September
30, 2021, the $5,563 due to related party balance was allocated to the Note which was executed on January 19, 2021. As of September 30,
2021, there was no amount due to related party as the Note was repaid.
JAWS JUGGERNAUT ACQUISITION CORPORATION
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 5 - COMMITMENTS AND CONTINGENCIES
Registration and Shareholder Rights
The holders of the Founder Shares, Private
Placement Warrants and any warrants that may be issued upon conversion of Working Capital Loans (and any Class A ordinary shares issuable
upon the exercise of the Private Placement Warrants and warrants that may be issued upon conversion of the Working Capital Loans) have
registration rights to require the Company to register a sale of any of the securities held by them pursuant to a registration rights
agreement signed upon the effective date of the Initial Public Offering. The holders 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 completion of a Business Combination. The registration
rights agreement does not contain liquidating damages or other cash settlement provisions resulting from delays in registering the Company’s
securities. The Company will bear the expenses incurred in connection with the filing of any such registration statements.
Underwriting Agreement
The Company granted the underwriter
a 45-day option from the final prospectus relating to the Initial Public Offering to purchase up to 3,600,000 additional Units to cover
over-allotments, if any, at the Initial Public Offering price less the underwriting discounts and commissions. The underwriters fully
exercised the over-allotment on June 22, 2021.
The underwriter was entitled to an underwriting
discount of $0.20 per Unit, or approximately $5.5 million in the aggregate, paid upon the closing of the Initial Public Offering. In addition,
$0.35 per unit, or approximately $9.7 million in the aggregate will be payable to the underwriter for deferred underwriting commissions.
The deferred fee will become payable to the underwriter 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.
Risks and Uncertainties
Management continues to evaluate the
impact of the COVID-19 pandemic on the industry and has concluded that while it is reasonably possible that the virus 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 this unaudited condensed financial statements. The unaudited condensed financial statement
does not include any adjustments that might result from the outcome of this uncertainty.
NOTE 6 - DERIVATIVE WARRANT LIABILITIES
As of September 30, 2021, the Company
had 6,900,000 Public Warrants and 3,760,000 Private Warrants outstanding. There were no warrants outstanding at December 31, 2020.
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 on the later of (a) 30 days after the completion of a Business Combination and (b) one year from the closing of the Initial
Public Offering. The Public Warrants will expire five years from the completion 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 warrant and will have no obligation to settle such warrant exercise
unless a registration statement under the Securities Act with respect to the Class A ordinary shares underlying the warrants is then effective
and a prospectus relating thereto is current, subject to the Company satisfying its obligations with respect to registration, or a valid
exemption from registration is available. No warrant will be exercisable and the Company will not be obligated to issue a Class A ordinary
share upon exercise of a warrant unless the Class A ordinary share issuable upon such warrant exercise has been registered, qualified
or deemed to be exempt under the securities laws of the state of residence of the registered holder of the warrants.
JAWS JUGGERNAUT ACQUISITION CORPORATION
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
The Company agreed that as soon as practicable,
but in no event later than 20 business days, after the closing of a Business Combination, it will use its best efforts to file with the
SEC a registration statement for the registration, under the Securities Act, of the Class A ordinary shares issuable upon exercise of
the warrants. The Company will use its best efforts to cause the same to become effective and to maintain the effectiveness of such registration
statement, and a current prospectus relating thereto, until the expiration of the warrants in accordance with the provisions of the warrant
agreement. If a registration statement covering the Class A ordinary shares issuable upon exercise of the warrants is not effective by
the sixtieth (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. Notwithstanding
the above, if our 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” in accordance with
Section 3(a)(9) of the Securities Act and, in the event the Company so elect, the Company will not be required to file or maintain in
effect a registration statement, and in the event the Company do not so elect, the Company will use its best efforts to register or qualify
the shares under applicable blue sky laws to the extent an exemption is not available.
Redemption of warrants when the price
per Class A ordinary share equals or exceeds $18.00.
Once the warrants become exercisable,
the Company may call the warrants for redemption (except as described with respect to the Private Placement Warrants):
|
●
|
in whole and not in part;
|
|
●
|
at a price of $0.01 per warrant;
|
|
●
|
upon not less than 30 days’
prior written notice of redemption to each warrant holder; and
|
|
●
|
if, and only if, the closing price of the Class A ordinary
shares equals or exceeds $18.00 per share (as adjusted for share subdivisions, share capitalizations, reorganizations, recapitalizations
and the like) for any 20 trading days within a 30-trading day period ending three business days before the Company sends to the notice
of redemption to the warrant holders (the “Reference Value”).
|
If and when the warrants become redeemable
by the Company, the Company may exercise its redemption right even if it is unable to register or qualify the underlying securities for
sale under all applicable state securities laws.
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:
|
●
|
in whole and not in part;
|
|
●
|
upon not less than 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 based on the redemption date and the fair market value of the Class A ordinary shares except as otherwise
described below;
|
|
●
|
if, and only if, the Reference
Value equals or exceeds $10.00 per Public 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
|
|
●
|
if the Reference Value 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.
|
If the Company calls the Public Warrants
for redemption, as described above, its management will have the option to require any holder that wishes to exercise the Public Warrants
to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number 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. However, except as described below, the Public Warrants will not
be adjusted for issuances of ordinary shares at a price below its exercise price. Additionally, in no event will the Company be required
to net cash to 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 Public Warrants will not receive any of such funds with respect
to their Public Warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with
respect to such Public Warrants. Accordingly, the Public Warrants may expire worthless.
JAWS JUGGERNAUT ACQUISITION CORPORATION
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
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 a Business
Combination at an issue price or effective issue price of less than $9.20 per Class A ordinary share (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 a Business Combination on the date of the consummation of a
Business Combination (net of redemptions), and (z) the volume weighted average trading price of its 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 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 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 will be adjusted (to the nearest cent) to be equal to the higher of the Market Value and the Newly Issued
Share Price.
The Private Placement Warrants are identical
to the Public Warrants underlying the Units being sold in the Initial Public Offering, except that the Private Placement Warrants and
the Class A 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 be non-redeemable, except as described above, 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.
The Company accounts for the Private
Placement Warrants and the Public Warrants issued in connection with the Initial Public Offering in accordance with the guidance contained
in ASC 815. Such guidance provides that because the warrants do not meet the criteria for equity treatment thereunder, each warrant must
be classified as a liability due to the existence of provisions whereby adjustments to the exercise price of the warrants is based on
a variable that is not an input to the fair value of a “fixed-for-fixed” option and the existence of the potential for net
cash settlement for the warrant holders (but not all shareholders) in the event of a tender offer.
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 300,000,000 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. As of September 30, 2021, there were 27,600,000
Class A ordinary shares outstanding, all of which were subject to possible redemption.
The Class A ordinary shares subject
to possible redemption reflected on the condensed balance sheet is reconciled on the following table:
Gross proceeds
|
|
$
|
276,000,000
|
|
Less:
|
|
|
|
|
Fair value of Public Warrants at issuance
|
|
|
(13,455,000
|
)
|
Offering costs allocated to Class A ordinary shares subject to possible redemption
|
|
|
(14,825,630
|
)
|
Plus:
|
|
|
|
|
Accretion of Class A ordinary shares subject to possible redemption amount
|
|
|
28,280,630
|
|
Class A ordinary shares subject to possible redemption
|
|
$
|
276,000,000
|
|
JAWS JUGGERNAUT ACQUISITION CORPORATION
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 8 - SHAREHOLDERS’ DEFICIT
Preference Shares - The
Company is authorized to issue 1,000,000 preference shares with a par value of $0.0001 per share, with such designations, voting and other
rights and preferences as may be determined from time to time by the Company’s board of directors. As of September 30, 2021 and
December 31, 2020, there were no preference shares issued or outstanding.
Class A Ordinary Shares -
The Company is authorized to issue 300,000,000 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. As of September 30, 2021, there were 27,600,000 Class
A ordinary shares issued and outstanding, which were all subject to possible redemption and have been classified as temporary equity (see
Note 7). There were no Class A ordinary shares issued or outstanding at December 31, 2020.
Class B Ordinary Shares -
The Company is authorized to issue 30,000,000 Class B ordinary shares, with a par value of $0.0001 per share. Holders of the Class B ordinary
shares are entitled to one vote for each share. As of December 31, 2020, there was one Class B ordinary share issued and outstanding,
which was subsequently canceled. On January 19, 2021, the Sponsor purchased 5,750,000 Class B ordinary shares. On June 22, 2021, the Company
effected a share dividend with respect to Class B ordinary shares, resulting in an aggregate of 6,900,000 Class B ordinary shares outstanding.
Of the 6,900,000 Class B ordinary shares outstanding, up to an aggregate of 900,000 shares were subject to forfeiture in the event that,
and to the extent to which, the underwriter’s option to purchase additional Units was exercised, so that the number of outstanding
Class B ordinary shares would equal, on an as-converted basis, approximately 20% of the Company’s issued and outstanding ordinary
shares after the Initial Public Offering. The underwriters fully exercised the over-allotment on June 22, 2021; thus, these 900,000 Class
B ordinary shares were no longer subject to forfeiture. Accordingly, at September 30, 2021 and December 31, 2020, 6,900,000 and 1 Class
B ordinary share(s) were issued and outstanding, respectively, none subject to forfeiture.
Holders of Class A ordinary shares and
Class B ordinary shares will vote together as a single class on all matters submitted to a vote of shareholders, except as required by
law.
The Class B ordinary shares will automatically
convert into Class A ordinary shares concurrently with or immediately following the consummation of a Business Combination on a one-for-one
basis, subject to adjustment. In the case that additional Class A ordinary shares or equity-linked securities are issued or deemed issued
in connection with a Business Combination, the number of Class A ordinary shares issuable upon conversion of all Founder Shares will equal,
in the aggregate, 20% of the total number of Class A ordinary shares outstanding after such conversion (after giving effect to any redemptions
of Class A ordinary shares by Public Shareholders), including the total number of Class A ordinary shares issued, or deemed issued or
issuable upon conversion or exercise of any equity-linked securities or rights issued or deemed issued, by the Company in connection with
or in relation to the consummation of a Business Combination, excluding any Class A ordinary shares or equity-linked securities exercisable
for or convertible into Class A ordinary shares issued, or to be issued, to any seller in a Business Combination and any Private Placement
Warrants issued to the Sponsor, officers or directors upon conversion of Working Capital Loans; provided that such conversion of Founder
Shares will never occur on a less than one-for-one basis.
JAWS JUGGERNAUT ACQUISITION CORPORATION
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 9 - FAIR VALUE MEASUREMENTS
The following table presents information
about the Company’s financial assets and liabilities that are measured at fair value as of September 30, 2021:
Description
|
|
Quoted Prices in Active
Markets
(Level 1)
|
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
|
Significant Other
Unobservable Inputs
(Level 3)
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
Investments held in Trust Account - U.S. Treasury Securities (1)
|
|
$
|
276,008,062
|
|
|
$
|
-
|
|
|
$
|
-
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivative warrant liabilities
|
|
$
|
8,211,000
|
|
|
$
|
-
|
|
|
$
|
-
|
|
Derivative warrant liabilities
|
|
$
|
-
|
|
|
$
|
4,474,400
|
|
|
$
|
-
|
|
(1) Includes $398 of cash.
Transfers to/from
Levels 1, 2, and 3 are recognized at the beginning of the reporting period. The Public Warrants began to be separately listed and traded
in August 2021 resulting in the transfer of the valuation of the warrant liabilities from Level 3 measurements to Level 1 and Level 2
measurements. At September 30, 2021 the fair value of the Public Warrants is measured at their listed trading price, a Level 1 measurement
and the fair value of the Private Warrants is measured by reference to the Public Warrant trading price, a Level 2 measurement. As the
transfer of Private Placement Warrants to anyone who is not a permitted transferee would result in the Private Placement Warrants having
substantially the same terms as the Public Warrants, the Company determined that the fair value of each Private Placement Warrant is equivalent
to that of each Public Warrant.
Level 1 assets include investments in
U.S. Treasury Securities. The Company uses inputs such as actual trade data, 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 Public Offering and Private Placement Warrants were initially measured at fair value using a Black-Scholes Option
Pricing Method (the “BSM”). As of September 30, 2021, the fair value of the Public Warrants is based on their listed trading
price and the fair value of the Private Placement Warrants is measured by reference to the listed trading price of the Public Warrants.
JAWS JUGGERNAUT ACQUISITION CORPORATION
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
The change in the fair value of the
derivative warrant liabilities measured with Level 3 inputs for the three and nine months ended September 30, 2021, is summarized as follows:
Derivative warrant liabilities at January 1, 2021
|
|
$
|
-
|
|
Issuance of Private Warrants January 19,
2021
|
|
|
6,501,000
|
|
Derivative warrant liabilities at March 31, 2021 (unaudited)
|
|
|
6,501,000
|
|
Issuance of Public and Private Warrant Liabilities
|
|
|
14,361,200
|
|
Change in Fair Value of warrant liabilities
|
|
|
138,000
|
|
Derivative warrant liabilities at June 30, 2021 (unaudited)
|
|
|
21,000,200
|
|
Transfer of Public Warrants to Level 1 measurement
|
|
|
(13,593,000
|
)
|
Transfer of Private Warrants to Level 2 measurement
|
|
|
(7,407,200
|
)
|
Derivative warrant liabilities at September 30, 2021 (unaudited)
|
|
$
|
-
|
|
NOTE 10 - SUBSEQUENT EVENTS
The Company evaluated subsequent events and
transactions that occurred up to the date unaudited condensed financial statements were issued. Based on this evaluation, other than
described in this Note, and with respect to the restatements described in Note 2. The Company did not identify any subsequent events
that would have required adjustment or disclosure in the unaudited condensed financial statements.