The accompanying notes are an integral part of
the unaudited condensed financial statements.
The accompanying notes are an integral part of
the unaudited condensed financial statements.
The accompanying notes are an integral part of
the unaudited condensed financial statements.
The accompanying notes are an integral part of
the unaudited condensed financial statements.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(Unaudited)
NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS
SilverSPAC Inc. (the “Company”) is
a blank check company incorporated as a Cayman Islands exempted company on January 21, 2021. In March 2021, the Company effected a name
change to SILVERspac Inc. 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 (“Business Combination”).
The Company is not limited to a particular industry
or geographic region for purposes of completing a Business Combination. The Company is an early stage and emerging growth company and,
as such, the Company is subject to all of the risks associated with early stage and emerging growth companies.
As of September 30, 2021, the Company had not
commenced any operations. All activity for the period from January 21, 2021 (inception) through September 30, 2021 relates to the Company’s
formation, the initial public offering (“Initial Public Offering”), which is described below, and identifying a target company
for a Business Combination. The Company will not generate any operating revenues until after the completion of a Business Combination,
at the earliest. The Company will generate non-operating income in the form of interest income from the proceeds derived from the Initial
Public Offering.
The registration statement for the Company’s
Initial Public Offering was declared effective on September 9, 2021. On September 14, 2021, the Company consummated the Initial Public
Offering of 25,000,000 units (the “Units” and, with respect to the Class A ordinary shares included in the Units being offered,
the “Public Shares”), at $10.00 per Unit, generating gross proceeds of $250,000,000, which is described in Note 3.
Simultaneously with the closing of the Initial
Public Offering, the Company consummated the sale of 4,666,667 warrants (the “Private Placement Warrants”) at a price of $1.50
per Private Placement Warrant in a private placement to SILVERspac Sponsor LLC (the “Sponsor”), generating gross proceeds
of $7,000,000, which is described in Note 4.
Transaction costs amounted to $15,082,415, consisting
of $5,000,000 of underwriting fees, $8,750,000 of deferred underwriting fees and $1,332,415 of other offering costs.
Following the closing of the Initial Public Offering
on September 14, 2021, an amount of $250,000,000 ($10.00 per Unit) from the net proceeds of the sale of the Units in the Initial Public
Offering and the sale of the Private Placement Units was placed in a trust account (the “Trust Account”) which will be invested
in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended (the
“Investment Company Act”), with a maturity of 185 days or less or in any open-ended investment company that holds itself out
as a money market fund meeting the conditions of Rule 2a-7 of the Investment Company Act, as determined by the Company. Except with respect
to interest earned on the funds held in the Trust Account that may be released to pay the Company’s taxes, if any, the funds held
in the Trust Account will not be released from the Trust Account until the earliest to occur of: (i) the completion of a Business Combination
or (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 completing a Business Combination. The Company
must complete its initial Business Combination with one or more target businesses that together have a fair market value equal to at least
80% of the net assets held in the Trust Account (net of amounts disbursed to management for working capital purposes, if permitted, and
excluding the amount of any deferred underwriting discount held in the Trust Account) at the time of the agreement to enter into a Business
Combination. The Company will only complete a Business Combination if the post-Business Combination company owns or acquires 50% or more
of the 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 complete a Business Combination.
The Company will provide its shareholders with
the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection
with a shareholder meeting called to approve the Business Combination or (ii) by means of a tender offer. 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 shareholders
will be entitled to redeem their shares for a pro rata portion of the amount held in the Trust Account (initially $10.00 per share), calculated
as of two business days prior to the completion of a Business Combination, including any pro rata interest earned on the funds held in
the Trust Account (which interest shall be net of taxes payable). There will be no redemption rights upon the completion of a Business
Combination with respect to the Company’s warrants.
SILVERSPAC INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(Unaudited)
The Company will proceed with a Business Combination
only if the Company has net tangible assets of at least $5,000,001 upon such completion of a Business Combination and, if the Company
seeks shareholder approval in connection with a Business Combination, 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 vote at a general meeting of the Company.
If a shareholder vote is not required under 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 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 has agreed to
vote its Founder Shares (as defined in Note 5) and any Public Shares purchased in or after the Initial Public Offering in favor of
approving a Business Combination and to waive its redemption rights with respect to any such shares in connection with a shareholder vote
to approve a Business Combination. However, the amended and restated memorandum and articles of association provide that the Company may
not redeem its Public Shares in an amount that would cause its net tangible assets to be less than $5,000,001. Additionally, each public
shareholder may elect to redeem its 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 a Business Combination and it does not conduct redemptions pursuant to the tender offer rules, 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% of the Public Shares without the Company’s prior written consent.
The Sponsor has agreed (a) to waive its redemption
rights with respect to any Founder Shares 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 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 in conjunction with any such amendment and (iii) to waive its rights to liquidating distributions from the Trust Account
with respect to the Founder Shares if the Company fails to complete a Business Combination.
The Company will have until September 14, 2023
(the “Combination Period”) to complete a Business Combination. If the Company is unable to complete 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 no more than 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 pay taxes (less up to $100,000 of interest to pay dissolution expenses and which interest shall be net of taxes
payable), divided by the number of then issued and outstanding Public Shares, which redemption will completely extinguish public shareholders’
rights 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 remaining shareholders and the Company’s board of directors,
dissolve and liquidate, subject in each case to its obligations under Cayman Islands law to provide for claims of creditors and the requirements
of other applicable law.
The Sponsor has agreed to waive its liquidation
rights with respect to the Founder Shares if the Company fails to complete a Business Combination within the Combination Period. However,
if the Sponsor acquires Public Shares in or after the Initial Public Offering, such Public Shares will be entitled to liquidating distributions
from the Trust Account if the Company fails to complete a Business Combination within the Combination Period. The underwriters have agreed
to waive their rights to their deferred underwriting commission (see Note 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 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).
SILVERSPAC INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(Unaudited)
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 by 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 (1) $10.00 per Public Share or (2) such lesser amount per
Public Share held in the Trust Account as of the date of the liquidation of the Trust Account due to reductions in the value of trust
assets, in each case net of the amount of interest which may be withdrawn to pay taxes. This liability will not apply with respect to
any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account 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”). Moreover, 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 auditors), prospective target businesses
or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim
of any kind in or to monies held in the Trust Account.
Risks and Uncertainties
Management continues to evaluate the impact of
the COVID-19 pandemic and has concluded that while it is reasonably possible that the pandemic could have a negative effect on the Company’s
financial position, results of its operations, and/or search for a target company, the specific impact is not readily determinable as
of the date of these financial statements. The financial statements do not include any adjustments that might result from the outcome
of this uncertainty.
Liquidity and Going Concern
As of September 30, 2021, the Company had $594,526
in its operating bank accounts, $250,000,657 in securities held in the Trust Account to be used for a Business Combination or to repurchase
or redeem its common stock in connection therewith and working capital of $574,140. As of September 30, 2021, $657 of the amount on deposit
in the Trust Account represented interest income, which is available to pay the Company’s tax obligations.
Until the consummation of a Business Combination,
the Company will be using the funds not held in the Trust Account for identifying and evaluating prospective acquisition candidates, performing
due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to acquire, and structuring,
negotiating and consummating the Business Combination.
The Company will need to raise additional capital
through loans or additional investments from its Sponsor, stockholders, officers, directors, or third parties. The Company’s officers,
directors and Sponsor may, but are not obligated to, loan the Company funds, from time to time or at any time, in whatever amount they
deem reasonable in their sole discretion, to meet the Company’s working capital needs. Accordingly, the Company may not be able
to obtain additional financing. If the Company is unable to raise additional capital, it may be required to take additional measures to
conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending the pursuit of a potential
transaction, and reducing overhead expenses. The Company cannot provide any assurance that new financing will be available to it on commercially
acceptable terms, if at all. These conditions raise substantial doubt about the Company’s ability to continue as a going concern
until the earlier of the consummation of the Business Combination or September 14, 2023, the date the Company is required to liquidate.
These financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the
liabilities that might be necessary should the Company be unable to continue as a going concern.
SILVERSPAC INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(Unaudited)
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited condensed financial
statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”)
for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the SEC. Certain
information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or
omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information
and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management,
the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are
necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented.
The accompanying unaudited condensed financial
statements should be read in conjunction with the Company’s prospectus for its Initial Public Offering as filed with the SEC on
September 9, 2021, as well as the Company’s Current Report on Form 8-K, as filed with the SEC on September 21, 2021. The interim
results for the three months ended September 30, 2021 and for the period from January 21, 2021 (inception) through September 30, 2021
are not necessarily indicative of the results to be expected for the year ending December 31, 2021 or for any future periods.
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 auditor attestation requirements
of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and
proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder
approval of any golden parachute payments not previously approved.
Further, Section 102(b)(1) of the JOBS Act exempts
emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that
is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered
under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company
can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but
any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that
when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging
growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison
of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth
company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting
standards used.
Use of Estimates
The preparation of the 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.
SILVERSPAC INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(Unaudited)
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. One of the more significant accounting estimates included in these condensed financial
statements is the determination of the fair value of warrant liabilities. Such estimates may be subject to change as more current information
becomes available and accordingly, the actual results could differ significantly from those estimates.
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 did not have any cash equivalents
as of September 30, 2021.
Marketable Securities Held in Trust Account
At September 30, 2021, substantially all of the
assets held in the Trust Account were held in money market funds which are invested primarily in U.S. Treasury securities.
Warrant Liabilities
The Company accounts for warrants as either equity-classified
or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance
in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing
Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment
considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant
to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants
are indexed to the Company’s own common stock, among other conditions for equity classification. This assessment, which requires
the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while
the warrants are outstanding.
For issued or modified warrants that meet all
of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the
time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required
to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair
value of the warrants are recognized as a non-cash gain or loss on the statements of operations (see Note 9).
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 Accounting Standards Codification (“ASC”) Topic 480
“Distinguishing Liabilities from Equity.” Conditionally redeemable ordinary shares (including ordinary shares that features
redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not
solely within the Company’s control) is classified as temporary equity. The Company’s Class A ordinary shares features certain
redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events.
Accordingly, at September 30, 2021, Class A ordinary shares subject to possible redemption is presented at redemption value as temporary
equity, outside of the shareholders’ equity section of the Company’s condensed balance sheet.
The Company recognizes changes in redemption value
immediately as they occur and adjusts the carrying value of redeemable ordinary shares to equal the redemption value at the end of each
reporting period. Immediately upon the closing of the Initial Public Offering, the Company recognized the accretion from initial book
value to redemption amount value. The change in the carrying value of redeemable Class A ordinary shares resulted in charges against additional
paid-in capital and accumulated deficit.
At September 30, 2021, the Class A ordinary shares
reflected in the condensed balance sheet are reconciled in the following table:
Gross proceeds
|
|
$
|
250,000,000
|
|
Less:
|
|
|
|
|
Proceeds allocated to Public Warrants
|
|
|
(7,166,666
|
)
|
Class A ordinary shares issuance costs
|
|
|
(14,318,926
|
)
|
Plus:
|
|
|
|
|
Accretion of carrying value to redemption value
|
|
|
21,486,249
|
|
Class A ordinary shares subject to possible redemption
|
|
$
|
250,000,657
|
|
SILVERSPAC INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(Unaudited)
Income Taxes
The Company accounts for income taxes under ASC
740, “Income Taxes” (“ASC 740”). ASC 740 requires the recognition of deferred tax assets and liabilities for both
the expected impact of differences between the financial statement and tax basis of assets and liabilities and for the expected future
tax benefit to be derived from tax loss and tax credit carry forwards. ASC 740 additionally requires a valuation allowance to be established
when it is more likely than not that all or a portion of deferred tax assets will not be realized.
ASC 740 also clarifies the accounting for uncertainty
in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement process
for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. For those benefits
to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The Company recognizes
accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and
no amounts accrued for interest and penalties as of September 30, 2021. 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.
The Company is considered an exempted Cayman Islands
Company and is presently not subject to income taxes or income tax filing requirements in the Cayman Islands or the United States. As
such, the Company's tax provision was zero for the periods presented.
Offering Costs
Offering costs consist of underwriting, legal,
accounting and other expenses incurred through the Initial Public Offering that are 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 derivative warrant liabilities are expensed as incurred, presented
as non-operating expenses in the statements of operations. Offering costs associated with the Public Shares were charged to accumulated
deficit, due to a lack of balance in additional paid in capital, upon the completion of the Initial Public Offering. Offering costs amounted
to $15,082,415, of which $14,260,300 were charged to shareholders’ equity upon the completion of the Initial Public Offering and
$822,115 were expensed to the statements of operations.
Deferred Legal Fee
In connection with the closing of the Initial
Public Offering, the Company became obligated to pay its attorneys a deferred legal fee of $681,933 upon consummation of a Business Combination.
Accordingly, the Company recorded $681,933 as accrued offering costs in the accompanying balance sheet. The deferred fee will be forfeited
by the attorneys in the event that the Company fails to complete a Business Combination.
Net income (Loss) per Ordinary Share
The Company complies with accounting and disclosure
requirements of FASB ASC Topic 260, “Earnings Per Share”. Net income (loss) per ordinary share is computed by dividing net
income (loss) by the weighted average number of ordinary shares outstanding for the period. The Company applies the two-class method in
calculating earnings per share. Accretion associated with the redeemable shares of Class A ordinary shares is excluded from earnings per
share as the redemption value approximates fair value.
The calculation of diluted income (loss) per share
does not consider the effect of the warrants issued in connection with the (i) Initial Public Offering, and (ii) the private placement
since the exercise of the warrants is contingent upon the occurrence of future events. The warrants are exercisable to purchase 9,888,889
Class A ordinary shares in the aggregate. As of September 30, 2021, the Company did not have any dilutive securities or other contracts
that could, potentially, be exercised or converted into ordinary shares and then share in the earnings of the Company. As a result, diluted
net income (loss) per ordinary share is the same as basic net loss per ordinary share for the periods presented.
SILVERSPAC INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(Unaudited)
The following table reflects the calculation of
basic and diluted net income (loss) per ordinary share (in dollars, except per share amounts):
|
|
Three
Months Ended
September 30, 2021
|
|
|
For the period from
January 21,
2021
(inception) through
September 30, 2021
|
|
|
|
Class A
|
|
|
Class B
|
|
|
Class A
|
|
|
Class B
|
|
Basic and diluted net income per ordinary share
|
|
|
|
|
|
|
|
|
|
|
|
|
Numerator:
|
|
|
|
|
|
|
|
|
|
|
|
|
Allocation of net income, as adjusted
|
|
$
|
565,563
|
|
|
$
|
924,784
|
|
|
$
|
268,463
|
|
|
$
|
1,215,634
|
|
Denominator:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted weighted average shares outstanding
|
|
|
4,395,604
|
|
|
|
7,187,500
|
|
|
|
1,587,302
|
|
|
|
7,187,500
|
|
Basic and diluted net income per ordinary share
|
|
$
|
0.13
|
|
|
$
|
0.13
|
|
|
$
|
0.17
|
|
|
$
|
0.17
|
|
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 of $250,000. The Company has not experienced losses on these accounts.
Fair Value of Financial Instruments
The fair value of the Company’s assets and
liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurement,” approximates the carrying
amounts represented in the accompanying condensed balance sheet, primarily due to their short-term nature, except for warrant liabilities
(see Note 9.)
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:
|
●
|
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 in active markets 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
|
|
●
|
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.
|
Recent Accounting Standards
In August 2020, the FASB issued 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. ASU 2020-06 removes
certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, and it also simplifies
the diluted earnings per share calculation in certain areas. ASU 2020-06 is effective for fiscal years beginning after December
15, 2023, including interim periods within those fiscal years, with early adoption permitted. The Company adopted ASU 2020-06 effective
January 21, 2021. The adoption of ASU 2020-06 did not have a material impact on the Company’s financial statement.
Management does not believe that any recently
issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed
financial statements.
SILVERSPAC INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(Unaudited)
NOTE 3. PUBLIC OFFERING
Pursuant to the Initial Public Offering, the Company
sold 25,000,000 Units at a purchase price of $10.00 per Unit. Each Unit consists of one Class A ordinary share and one-third of one
redeemable warrant (“Public Warrant”). Each whole Public Warrant entitles the holder to purchase one Class A ordinary
share at an exercise price of $11.50 per share, subject to adjustment (see Note 8).
NOTE 4. PRIVATE PLACEMENT
Simultaneously with the closing of the Initial
Public Offering, the Sponsor purchased an aggregate of 4,666,667 Private Placement Warrants at a price of $1.50 per Private Placement
Warrant (for an aggregate purchase price of $7,000,000) from the Company in a private placement. Each Private Placement Warrant is exercisable
for one Class A ordinary share at a price of $11.50 per share, subject to adjustment (see Note 8). The proceeds from the sale
of the Private Placement Warrants were added to the net 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 held
in the Trust Account 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.
NOTE 5. RELATED PARTY TRANSACTIONS
Founder Shares
On January 21, 2021, the Sponsor paid $25,000
to cover certain offering and formation costs of the Company in consideration for 7,187,500 Class B ordinary shares (the “Founder
Shares”). In February 2021 and July 2021 (with respect to Ms. Roffman), our Sponsor transferred 25,000 founder shares to each
of David Z. Hirsh, Bonnie Kintzer, Dana Roffman, David Sable and Hagi Schwartz, our independent director nominees, at their original
per-share purchase price. The Founder Shares included an aggregate of up to 937,500 shares which were subject to forfeiture depending
on the extent that the underwriters’ over-allotment option was not exercised, if at all. On October 25, 2021, upon the expiration
of the 45-day period and the underwriters not exercising the over-allotment option, 937,500 Founder Shares were forfeited by the Sponsor
in order for the number of Founder Shares to collectively represent 20% of the Company’s issued and outstanding shares upon the
completion of the Initial Public Offering.
The initial shareholders have agreed, subject
to limited exceptions, not to transfer, assign or sell any of their Founder Shares until the earlier to occur of: (A) one year after
the completion of a Business Combination; and (B) subsequent to a Business Combination, (x) if the last reported sale price
of the Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share sub-divisions, share dividends, rights issuances,
consolidations, reorganizations, recapitalizations and other similar transactions) 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,
amalgamation, share exchange, reorganization or other similar transaction that results in all of the Company’s shareholders having
the right to exchange their Class A ordinary shares for cash, securities or other property.
In connection with the closing of the Initial
Public Offering, certain qualified institutional buyers or institutional accredited investors (“Anchor Investors”) acquired
from the Sponsor an indirect economic interest in an aggregate of 1,485,606 Founder Shares at the original purchase price that the Sponsor
paid for the Founder Shares. The Sponsor has agreed to distribute such Founder Shares to the Anchor Investors after the completion of
a Business Combination. The Company estimated the aggregate fair value of the Founder Shares attributable to the Anchor Investors to be
$8,393,674, or $5.65 per share. The fair value of the Founder Shares were valued using a binomial/lattice model. The excess of the fair
value of the Founder Shares was determined to be an offering cost in accordance with Staff Accounting Bulletin Topic 5A. Accordingly,
the offering cost was 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 related to the Founder Shares amounted to $8,393,674, of which $369,322
were expensed to the statements of operations and included in transaction costs attributable to warrant liabilities and the remaining
$8,024,352 was netted to accumulated deficit due to a lack of balance in additional paid in capital.
The allocation of the Founder Shares to the director
nominees is in the scope of FASB ASC Topic 718, “Compensation-Stock Compensation” (“ASC 718”). Under ASC
718, stock-based compensation associated with equity-classified awards is measured at fair value upon the grant date. The Company has
hired a valuation firm to assess using the lattice model, the fair value associated with the found shares granted. The fair value of the
100,000 shares granted to the Company’s director nominees in February 2021 was $252,000 or $2.52 per share. The fair value of the
25,000 shares granted in July 2021 was $77,500 or $3.10 per share. The Founder Shares were granted subject to a performance condition
(i.e., the occurrence of a Business Combination). Compensation expense related to the Founder Shares is recognized only when the performance
condition is probable of occurrence under the applicable accounting literature in this circumstance. As of September 14, 2021, the Company
determined the performance conditions are not considered probable, and, therefore, no stock-based compensation expense has been recognized.
Stock-based compensation would be recognized at the date the performance conditions are considered probable (i.e., upon consummation of
a Business Combination) in an amount equal to the number of Founder Shares vested times the grant date fair value per share (unless subsequently
modified) less the amount initially received for the purchase of the Founder Shares.
SILVERSPAC INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(Unaudited)
Office Space and Indemnification Agreement
The Company entered into an office space and indemnification
agreement, commencing on September 9, 2021 through the earlier of the Company’s consummation of a Business Combination or its liquidation,
to, among other things pay Silverstein Properties LLC a total of up to $120,000 per year for office space. Upon completion of a Business
Combination or the Company’s liquidation, the Company will cease paying these fees.
Promissory Note — Related Party
On January 26, 2021, the Company issued an unsecured
promissory note to the Sponsor (the “Promissory Note”), pursuant to which the Company may borrow up to an aggregate principal
amount of $300,000. The Promissory Note is non-interest bearing and payable on the earlier of December 31, 2021, or the consummation of
the Initial Public Offering. As of September 30, 2021, the outstanding amount of $258,731 was repaid during the Initial Public Offering.
Related Party Loans
In order to fund working capital deficiencies
or to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor or certain of the
Company’s directors and officers 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 would repay the Working Capital Loans out of the proceeds
of the Trust Account released to the Company. Otherwise, the Working Capital Loans would 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.
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 $2,000,000 of such Working Capital Loans may be convertible into warrants of the post-Business
Combination entity at a price of $1.50 per warrant. The warrants would be identical to the Private Placement Warrants. As of September
30, 2021, there were no Working Capital Loans outstanding.
NOTE 6. COMMITMENTS
Registration Rights
Pursuant to a registration rights agreement entered
into on September 9, 2021, the holders of the Founder Shares, Private Placement Warrants and warrants that may be issued upon conversion
of the 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 Working Capital Loans and upon conversion of the Founder Shares) are entitled to certain registration
rights. The holders of these securities are entitled to make up to three demands, excluding short form registration 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 the Business Combination and rights to require the Company to register for resale such
securities pursuant to Rule 415 under the Securities Act. However, the registration rights agreement provides that the Company will
not be required to effect or permit any registration or cause any registration statement to become effective until termination of the
applicable lock-up period. The Company will bear the expenses incurred in connection with the filing of any such registration statements.
Underwriting Agreement
The Company granted the underwriters a 45-day
option to purchase up to 3,750,000 additional Units to cover over-allotments at the Initial Public Offering price, less the underwriting
discounts and commissions. On October 25, 2021, the over-allotment option expired unexercised.
The underwriters were entitled to a cash underwriting
discount of $0.20 per Unit, or $5,000,000 in the aggregate, paid upon the closing of the Initial Public Offering. In addition, the underwriters
are entitled to a deferred fee of $0.35 per Unit, or $8,750,000 in the aggregate. 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.
SILVERSPAC INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(Unaudited)
NOTE 7. SHAREHOLDERS’ EQUITY
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. At September 30, 2021, there were no
preference shares issued or outstanding.
Class A Ordinary Shares —
The Company is authorized to issue 200,000,000 Class A ordinary shares, with a par value of $0.0001 per share. Holders of Class A
ordinary shares are entitled to one vote for each share. At September 30, 2021, there were 25,000,000 Class A ordinary shares issued
and outstanding, including 25,000,000 shares of Class A ordinary shares subject to possible redemption, which are presented as temporary
equity.
Class B Ordinary Shares —
The Company is authorized to issue 20,000,000 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. At September 30, 2021, there were 7,187,500 Class B ordinary shares issued
and outstanding. . On October 25, 2021, upon the expiration of the 45-day period and the underwriters not exercising the over-allotment
option, 937,500 Class B ordinary shares were forfeited by the Sponsor in order for the number of Founder Shares to collectively represent
equal 20% of the Company’s issued and outstanding ordinary shares upon the completion of the Initial Public Offering.
Holders of Class B ordinary shares will have
the right to elect all of the Company’s directors prior to a Business Combination. Holders of Class A ordinary shares and Class B
ordinary shares will vote together as a single class on all other 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 at the time of a Business Combination, or earlier at the option of the holder, 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 excess of the amounts issued in the Initial Public Offering and related to the closing of the Business Combination, the ratio
at which the Class B ordinary shares will convert into Class A ordinary shares will be adjusted (unless the holders of a majority
of the issued and outstanding Class B ordinary shares agree to waive such anti-dilution adjustment with respect to any such issuance
or deemed issuance) so that the number of Class A ordinary shares issuable upon conversion of all Class B ordinary shares will
equal, in the aggregate, on an as-converted basis, 20% of the sum of all ordinary shares issued and outstanding upon the completion of
the Initial Public Offering plus all Class A ordinary shares and equity-linked securities issued or deemed issued in connection with
the Business Combination, excluding any shares or equity-linked securities issued, or to be issued, to any seller in the Business Combination.
NOTE 8. WARRANT LIABILITY
At September 30, 2021, there are 8,333,333 Public
Warrants outstanding. Public Warrants may only be exercised for a whole number of shares. No fractional shares will be issued upon exercise
of the Public Warrants. The Public Warrants will become exercisable 30 days after the completion of a Business Combination. 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 Public Warrant and will have no obligation to settle such Public Warrant exercise
unless a registration statement under the Securities Act covering the issuance of the Class A ordinary shares issuable upon exercise
of the warrants is then effective and a current prospectus relating thereto is available, subject to the Company satisfying its obligations
with respect to registration, or a valid exemption from registration is available. No warrant will be exercisable for cash or on a cashless
basis, and the Company will not be obligated to issue any shares to holders seeking to exercise their warrants, unless the issuance of
the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption
is available.
SILVERSPAC INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(Unaudited)
The Company has agreed that as soon as practicable,
but in no event later than 15 business days, after the closing of a Business Combination, it will use its commercially reasonable efforts
to file with the SEC a post-effective amendment to the registration statement of which this prospectus forms a part or a new registration
statement covering the issuance, under the Securities Act, of the Class A ordinary shares issuable upon exercise of the warrants,
and the Company will use our commercially reasonable efforts to cause the same to become effective within 60 business days after the closing
of a Business Combination 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. 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” in accordance with Section 3(a)(9)
of the Securities Act and, in the event the Company so elects, the Company will not be required to file or maintain in effect a registration
statement, but will use its commercially reasonable 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 redeem the outstanding Public
Warrants (except with respect to the Private Placement Warrants):
|
●
|
in
whole and not in part;
|
|
●
|
at
a price of $0.01 per Public Warrant;
|
|
●
|
upon
not less than 30 days’ prior written notice of redemption to each warrant holder; and
|
|
●
|
if,
and only if, if, and only if, the last reported sale 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
(the “Reference Value”) equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable
upon exercise or the exercise price of a warrant).
|
If and when the warrants become redeemable by the Company, the Company
may exercise its redemption right even if the Company is unable to register or qualify the underlying securities for sale under all applicable
state securities laws.
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;
|
|
●
|
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 shares, based on the redemption date and the fair market
value of the Class A ordinary shares;
|
|
●
|
if,
and only if, the Reference Value equals or exceeds $10.00 per share (as adjusted for adjustments to the number of shares issuable upon
exercise or the exercise price of a warrant); and
|
|
●
|
if
the Reference Value is less than $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the
exercise price of a warrant), the Private Placement Warrants must also be concurrently called for redemption on the same terms as the
outstanding Public Warrants, as described above.
|
SILVERSPAC INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(Unaudited)
The exercise price and number of Class A
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 Class A ordinary shares at a price below its exercise price. Additionally,
in no event will the Company be required to net cash settle the Public Warrants. If the Company is unable to complete a Business Combination
within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of 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.
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
Price.
As of September 30, 2021, there are 4,666,667
Private Placement Warrants outstanding. The Private Placement Warrants are identical to the Public Warrants underlying the Units 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.
SILVERSPAC INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(Unaudited)
NOTE 9. FAIR VALUE MEASUREMENTS
The following table presents information about
the Company’s assets that are measured at fair value on a recurring basis at September 30, 2021, and indicates the fair value hierarchy
of the valuation inputs the Company utilized to determine such fair value:
Description
|
|
Level
|
|
|
September 30,
2021
|
|
Assets:
|
|
|
|
|
|
|
Marketable securities held in Trust Account
|
|
|
1
|
|
|
$
|
250,000,657
|
|
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
Warrant liability – Public Warrants
|
|
|
3
|
|
|
$
|
5,612,800
|
|
Warrant liability – Private Placement Warrants
|
|
|
3
|
|
|
$
|
3,143,200
|
|
The Warrants were accounted for as liabilities
in accordance with ASC 815-40 and are presented within warrant liabilities in the accompanying balance sheet. The warrant liabilities
are measured at fair value at inception and on a recurring basis, with changes in fair value presented within the statements of operations.
The Private Placement Warrants were initially
and subsequently valued using a Monte Carlo Simulation Model, which is considered to be a Level 3 fair value measurement. The Monte Carlo
Simulation model’s primary unobservable input utilized in determining the fair value of the Private Placement Warrants is the expected
volatility of the common stock. The expected volatility as of the Initial Public Offering date was derived from observable public warrant
pricing on comparable ‘blank-check’ companies without an identified target. The expected volatility as of subsequent valuation
dates was implied from the Company’s own Public Warrant pricing. A Monte Carlo simulation methodology was used in estimating the
fair value of the Public Warrants for periods where no observable traded price was available, using the same expected volatility as was
used in measuring the fair value of the Private Placement Warrants. For periods subsequent to the detachment of the Public Warrants from
the Units, the close price of the Public Warrant price will be used as the fair value as of each relevant date.
The key inputs into the Monte Carlo Simulation
for the Private Placement Warrants as of September 30, 2021 and September 14, 2021, were as follows:
Input
|
|
September 14,
2021
(Initial
Measurement)
|
|
|
September 30,
2021
|
|
Stock price
|
|
$
|
9.52
|
|
|
|
10.00
|
|
Exercise price
|
|
$
|
11.50
|
|
|
|
11.50
|
|
Expected term (in years)
|
|
|
5.0
|
|
|
|
5.0
|
|
Probability of business combination
|
|
|
65.0
|
%
|
|
|
80.0
|
%
|
Volatility
|
|
|
20.0
|
%
|
|
|
15.0
|
%
|
Risk-free rate
|
|
|
1.0
|
%
|
|
|
0.93
|
%
|
Term (years)
|
|
|
1.50
|
|
|
|
1.50
|
|
Dividend yield
|
|
|
0.0
|
%
|
|
|
0.0
|
%
|
SILVERSPAC INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2021
(Unaudited)
The following table presents the changes in the
fair value of Level 3 warrant liabilities:
|
|
Private
Placement
|
|
|
Public
|
|
|
Warrant
Liabilities
|
|
Fair value as of January 21, 2021 (inception)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Initial measurement on September 14, 2021
|
|
|
4,013,334
|
|
|
|
7,166,666
|
|
|
|
11,180,000
|
|
Change in fair value
|
|
|
(870,134
|
)
|
|
|
(1,553,866
|
)
|
|
|
(2,424,000
|
)
|
Fair value as of September 30, 2021
|
|
$
|
3,143,200
|
|
|
$
|
5,612,800
|
|
|
$
|
8,756,000
|
|
Transfers to/from Levels 1, 2 and 3 are recognized
at the end of the reporting period in which a change in valuation technique or methodology occurs. There were no transfers in or out of
Level 3 from other levels in the fair value hierarchy for the period from January 21, 2021 (inception) through September 30, 2021.
NOTE 10. SUBSEQUENT EVENTS
The Company evaluated subsequent events and transactions
that occurred after the balance sheet date up to the date that the condensed financial statements were issued. Based upon this review,
other than described below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the
condensed financial statements.
As described in Note 5, on October 25, 2021, upon the expiration of
the 45-day period and the underwriters not exercising the over-allotment option, the Sponsor surrendered for no consideration of 937,500
Class B ordinary shares held by the Sponsor.