For the three months ended June 30, 2022, we had net income of
$1,987,208, consisting of formation and operating costs of $11,029,
offset by an unrealized gain on fair value of warrants and Forward
Purchase Units (as defined below) of $1,849,858, gain on marketable
securities (net), dividends and interest on investment held in the
Trust Account of $156,331 and income tax provision $7,952.
For the six months ended June 30, 2022, we had net income of
$25,493,564, consisting of formation and operating costs of
$632,716, offset by an unrealized gain on fair value of warrants
and Forward Purchase Units of $25,969,393, gain on marketable
securities (net), dividends and interest on investment held in the
Trust Account of $164,839 and income tax provision $7,952.
For the three months ended, and the period from February 25, 2021
(inception) through June 30, 2021, we had a net loss of $8,418,544
and $8,429,799, respectively, consisting of formation and operating
costs of $159,268 and $170,523, respectively. For the three months
ended, and the period from February 25, 2021 (inception) through
June 30, 2021, we had unrealized loss on fair value of warrants and
Forward Purchase Units amounting to $1,316,994 and $2,951,652,
respectively, financing expense of $3,196,156, and offering costs
allocated to warrants of $794,474.
Liquidity and Capital
Resources
On June 18, 2021, we consummated our Initial Public Offering of
34,500,000 units (the “Units”), which includes the exercise in full
of the underwriters’ option to purchase an additional 4,500,000
Units at the initial public offering price to cover
over-allotments. Each Unit consists of one share of Class A common
stock, $0.0001 par value per share, and one-third of one redeemable
warrant. Each whole warrant entitles the holder thereof to purchase
one share of our Class A common stock at a price of $11.50 per
share, subject to adjustment, and only whole warrants are
exercisable. The Units were sold at an offering price of $10.00 per
Unit, generating gross proceeds of $345,000,000. Since August 6,
2021, holders of the Units may elect to separately trade the public
shares and warrants included in the Units. No fractional warrants
are issued upon separation of the Units and only whole warrants
trade. Simultaneously with the consummation of the Initial Public
Offering and the issuance and sale of the Units on June 18, 2021,
we consummated the private placement of 10,550,000 warrants (the
“Private Placement Warrants”) at a price of $1.00 per Private
Placement Warrant, generating total proceeds of $10,550,000 (the
“Private Placement”).
Transaction costs for the Initial Public Offering amounted to
$18,426,851, consisting of $6,200,000 of underwriting discounts and
commissions, $10,850,000 of deferred underwriting discounts and
commissions, and $1,376,851 of other offering costs.
Upon closing of the Initial Public Offering and the Private
Placement, a total of $345,000,000 ($10.00 per Unit) was placed in
a U.S.-based trust account (the “Trust Account”), with Continental
Stock Transfer & Trust Company acting as trustee. The proceeds
held in the Trust Account have been invested only in U.S.
government treasury obligations with a maturity of 185 days or less
or in money market funds meeting certain conditions under Rule 2a-7
under the Investment Company Act of 1940, as amended, which invest
only in direct U.S. government treasury obligations.
As of June 30, 2022, we had cash outside our Trust Account of
$1,045,908 and had working capital of $1,394,858 (excluding
franchise and income taxes payable). As of December 31, 2021, we
had $1,634,576 in cash and working capital of $1,776,113. The
reduction in cash balances outside of the Trust Account is
attributable to payment of expenses related to the administrative
and operating activities. All remaining cash from the Initial
Public Offering is held in the Trust Account and is generally
unavailable for use prior to an initial Business Combination. We
believe the cash outside of our Trust Account is sufficient to meet
the expenditures required for operating our business for twelve
months from the date these unaudited condensed financial statements
are issued.
We intend to use substantially all of the funds held in the Trust
Account, including any amounts representing interest earned on the
Trust Account (less franchise and income taxes payable and deferred
underwriting discounts and commissions) and the proceeds from the
sale of the Forward Purchase Units to complete our initial Business
Combination. We may withdraw interest to pay our franchise and
income taxes. We estimate our annual franchise tax obligations for
the taxable years beginning after the completion of our Initial
Public Offering, based on the number of shares of our common stock
authorized and outstanding after the completion of our Initial
Public Offering, to be $200,000, which is the maximum amount of
annual franchise taxes payable by us as a Delaware corporation per
annum. We will also be liable for income tax based on the results
of operations and applicable tax rates. We will pay both franchise
and income taxes from funds from the Initial Public Offering held
outside of the Trust Account or from interest earned on funds held
in the Trust Account and released by the Trustee to use for this
purpose. To the extent that our capital stock or debt is used, in
whole or in part, as consideration to complete our initial Business
Combination, the remaining proceeds held in the Trust Account will
be used as working capital to finance the operations of the target
business or businesses, make other acquisitions and pursue our
growth strategies.