The accompanying notes are an integral
part of these unaudited condensed financial statements.
The accompanying notes are an integral part of
these unaudited condensed financial statements.
The accompanying notes are an integral part of
these unaudited condensed financial statements.
The accompanying notes are an integral part of
these unaudited condensed financial statements.
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2023
NOTE 1. ORGANIZATION AND PLAN OF BUSINESS OPERATIONS
Vector Acquisition Corporation II (the “Company”) is a
blank check company incorporated as a Cayman Islands exempted company on January 5, 2021. The Company was incorporated 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 (a “Business Combination”).
The Company is not limited to a particular industry or sector for purposes
of consummating 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 March 31, 2023, the Company had not commenced any operations.
All activity for the period from inception through March 31, 2023 relates to the Company’s formation, the initial public offering
(“Initial Public Offering”), which is 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 a Business Combination,
at the earliest. The Company generates non-operating income in the form of interest income from the investments held in the Trust Account
(as defined below).
The registration statement for the Company’s Initial Public Offering
was declared effective on March 9, 2021. On March 12, 2021 the Company consummated the Initial Public Offering of 45,000,000 Class A ordinary
shares (the “Public Shares”), at $10.00 per Public Share, generating gross proceeds of $450,000,000 which is described in
Note 3.
Simultaneously with the closing of the Initial Public Offering, the
Company consummated the sale of 1,100,000 private placement shares (the “Private Placement Shares”) at a price of $10.00 per
Private Placement Share in a private placement to Vector Acquisition Partners II, L.P. (the “Sponsor”), generating gross proceeds
of $11,000,000, which is described in Note 4.
Transaction costs amounted to $25,397,963, consisting of $9,000,000
of underwriting fees, $15,750,000 of deferred underwriting fees and $647,963 of other offering costs.
Following the closing of the Initial Public Offering on March 12, 2021,
an amount of $450,000,000 ($10.00 per Public Share) from the net proceeds of the sale of the Public Shares in the Initial Public Offering
and a portion of the proceeds from the sale of the Private Placement Shares was placed in a trust account (the “Trust Account”)
and 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 investing solely in U.S. Treasuries and meeting certain conditions under Rule 2a-7 of
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.
VECTOR ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2023
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 Shares, 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 any deferred underwriting discount held in the Trust Account and
taxes payable on the income 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.
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 $10.00 per Public Share), including interest (which interest shall be net of taxes payable), 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 underwriters (as discussed in Note 6).
The Company will proceed with a Business Combination only if the Company
seeks shareholder approval and 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 has agreed to vote the Founder Shares (as defined in Note 5) 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 has agreed (a) to waive its redemption rights with
respect to any Founder Shares, Private Placement 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 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.
VECTOR ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2023
The Company will have until March 12, 2024 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 the Company to pay its
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.
The Sponsor has agreed to waive its rights to
liquidating distributions from the Trust Account with respect to the Founder Shares and Private Placement Shares it received if the Company
fails to complete a Business Combination within the Combination Period. However, if the Sponsor or any of its respective affiliates acquire
Public Shares, such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete
a Business Combination within the Combination Period. The underwriters have agreed to waive their rights to their deferred underwriting
commission (see Note 6) held in the Trust Account in the event the Company does not complete a Business Combination within the Combination
Period, and in such event, such amounts will be included with the other funds held in the Trust Account that will be available to fund
the redemption of the Public Shares. In the event of such distribution, it is possible that the per share value of the assets remaining
available for distribution will be less than the Initial Public Offering price per Public Share ($10.00).
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 (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 underwriters of the Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as
amended (the “Securities Act”). In the event that an executed waiver is deemed to be unenforceable against a third party,
the Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility
that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have 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.
Trust Extension and Other Amendments
On March 8, 2023, the Company held an annual general meeting of shareholders
to vote on the proposals described below. At the meeting, the shareholders approved a proposal to amend the Company’s investment
management trust agreement, dated as of March 9, 2021, by and between the Company and Continental Stock Transfer & Trust Company,
to extend the date by which the Company has to consummate a business combination from March 12, 2023 to March 12, 2024 or such earlier
date as is determined by the Company’s board of directors to be in the best interests of the Company. Secondly, the shareholders
approved a proposal to amend the Company’s amended and restated memorandum and articles of association to remove the limitation
that the Company shall not redeem Class A ordinary shares sold in its initial public offering to the extent that such redemption would
cause the Company’s net tangible assets to be less than $5,000,001.
VECTOR ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2023
On March 3, 2023, the Company and its sponsor
entered into share transfer agreements with several unaffiliated holders (the “Holders”) of the Company’s Class A ordinary
shares, par value $0.0001 per share, pursuant to which such Holders agreed not to redeem an aggregate of 3,500,000 Class A Shares (the
“Non-Redeemed Shares”) in connection with the Extension. In exchange for the foregoing commitments not to redeem such Non-Redeemed
Shares, the Sponsor has agreed to forfeit and surrender to the Company for no consideration an aggregate of 1,050,000 Class A ordinary
shares held by the Sponsor at the closing of the Company’s initial business combination, and the Company has agreed to issue an
aggregate of 1,050,000 Class A ordinary shares to the Holders at such time.
On March 8, 2023, the holders of the Company’s
outstanding Class B ordinary shares, par value $0.0001 per share, converted all outstanding Founder Shares into Class A ordinary shares
on a one-for-one basis as permitted by the amended and restated memorandum and articles of association. Notwithstanding the conversions,
such holders will not be entitled to receive any monies held in the Company’s trust account as a result of their ownership of any
Class A ordinary shares issued upon conversion of the founder shares.
Redemptions
In connection with the vote to approve the
extension by which the Company has to consummate a business combination, holders of 41,093,174 Class A ordinary shares exercised their
right to redeem their shares for cash at a redemption price of approximately $10.22 per share, for an aggregate redemption amount of approximately
$420 million. As a result, at March 9, 2023 approximately $39.9 million remained in the Company’s trust account and 16,256,826 Class
A ordinary shares remained outstanding (including the converted founder shares).
Liquidity and Capital Resources
As of March 31, 2023, the Company had $86,960 in its operating bank
account and working capital deficit of $1,034,799. In order to fund working capital deficiencies or finance transaction costs in connection
with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the Company’s officers and directors, may
loan the Company funds as may be required (the “Working Capital Loans”), of which up to $1,500,000 has been committed by the
Sponsor (see Note 5). On March 18, 2022, the Company entered into a working capital loan agreement (the “Working Capital Loan Agreement”)
with its Sponsor, pursuant to which the Company may borrow up to $300,000 for ongoing business expenses. As of March 31, 2023, the Company
had $300,000 of outstanding borrowings under the Working Capital Loan Agreement. On March 23, 2023, the Company entered into a second
working capital loan agreement with the Sponsor, pursuant to which the Company may borrow up to $500,000, for ongoing business expenses.
As of March 31, 2023, the Company had $350,000 of outstanding borrowings under the second working capital loan agreement.
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. 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.
The Company may raise additional capital through loans or additional
investments from the Sponsor or third parties. The Company’s the Sponsor may, but is not obligated to (except as described above),
loan the Company funds, from time to time, in whatever amount it deems reasonable in its sole discretion, to meet the Company’s
working capital needs. Based on the foregoing, the Company believes it will have sufficient working capital and borrowing capacity from
the Sponsor to meet its needs through the earlier of the consummation of a Business Combination or at least one year from the date that
the financial statements were issued.
VECTOR ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2023
Going Concern
The Company intends to achieve its business objective of completing
its initial business combination with one or more businesses but cannot guarantee its ability to consummate such transaction. The Company
had a working capital deficit of $1,034,799 as of March 31, 2023.In connection with the Company’s assessment of going concern considerations
in accordance with Financial Accounting Standards Board Accounting Standards Update 2014-15, “Disclosures of Uncertainties about
an Entity’s Ability to Continue as a Going Concern,” management has determined that the liquidity condition and date for mandatory
liquidation and dissolution raises substantial doubt about the Company’s ability to continue as a going concern through March 12,
2024, the scheduled liquidation date of the Company if it does not complete a Business Combination prior to such date. The Company intends
to complete a Business Combination by March 12, 2024, but cannot guarantee such event. 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.
NOTE 2. 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 period presented.
The accompanying unaudited condensed financial
statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the period ended December 31, 2022, as
filed with the SEC on March 24, 2023. The interim results for the three months ended March 31, 2023 are not necessarily indicative of
the results to be expected for the year ending December 31, 2023 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 independent registered public accounting
firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation
in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive
compensation and shareholder approval of any golden parachute payments not previously approved.
Further, Section 102(b)(1) of the JOBS Act exempts
emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that
is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered
under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company
can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but
any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that
when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging
growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison
of the Company’s financial statement 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.
VECTOR ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2023
Use of Estimates
The preparation of the accompanying unaudited
condensed financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the reporting period.
Making estimates requires management to exercise
significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances
that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near
term due to one or more future confirming events. 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 March 31, 2023 and December 31, 2022.
Investments held in Trust Account
In March 2023, the Company moved all investments
from U.S. Treasury securities to demand deposits. At March 31, 2023, substantially all of the assets held in the Trust Account were held
as demand deposits. At December 31, 2022, substantially all of the assets held in the Trust Account were held in U.S. Treasury securities.
The Company’s investments held in the Trust Account as of December 31, 2022 are classified as trading securities. Trading securities
are presented on the condensed balance sheet at fair value at the end of each reporting period. Gains and losses resulting from the change
in fair value of these investments are included in interest earned on marketable securities held in Trust Account in the accompanying
statement of operations. The estimated fair values of investments held in the Trust Account are determined using available market information.
Offering Costs
Offering costs consist of legal, accounting, underwriting
fees and other costs incurred through the condensed balance sheet date that are directly related to the Initial Public Offering. Offering
costs amounting to $25,397,963 were charged to temporary equity upon the completion of the Initial Public Offering.
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.” Class A ordinary shares subject to mandatory redemption are classified as a liability
instrument and are measured at fair value. Conditionally redeemable ordinary shares (including ordinary shares that feature redemption
rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within
the Company’s control) are classified as temporary equity. At all other times, ordinary shares are classified as shareholders’
equity. The Company’s Class A ordinary shares feature certain redemption rights that are considered to be outside of the Company’s
control and subject to occurrence of uncertain future events. Accordingly, at March 31, 2023 and December 31, 2022, the 3,906,826 and
45,000,000 Class A ordinary shares subject to possible redemption, respectively, are presented as temporary equity, outside of the shareholders’
equity section of the Company’s condensed balance sheets.
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.
VECTOR ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2023
At March 31, 2023 and December 31, 2022,
the Class A ordinary shares reflected in the condensed balance sheets are reconciled in the following table:
Class A ordinary shares subject to possible redemptions at December 31, 2021 | |
$ | 450,000,000 | |
Plus: | |
| | |
Accretion of carrying value to redemption value | |
| 6,427,534 | |
| |
| | |
Class A ordinary shares subject to possible redemptions at December 31, 2022 | |
$ | 456,427,534 | |
| |
| | |
Less: | |
| | |
Redemption of Class A ordinary shares | |
| (419,974,456 | ) |
Plus: | |
| | |
Accretion of carrying value to redemption value | |
| 3,633,489 | |
| |
| | |
Class A ordinary shares subject to possible redemptions at March 31, 2023 | |
$ | 40,086,567 | |
Income Taxes
The Company accounts for income taxes under ASC
Topic 740, “Income Taxes,” which prescribes a recognition threshold and a measurement attribute for the financial statement
recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax
position must be more likely than not to be sustained upon examination by taxing authorities. The Company’s management determined
that the Cayman Islands is the Company’s major tax jurisdiction. The Company recognizes accrued interest and penalties related to
unrecognized tax benefits as income tax expense. As of March 31, 2023 and December 31, 2022, there were no unrecognized tax benefits and
no amounts accrued for interest and penalties. 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 considered to be an exempted Cayman
Islands company with no connection to any other taxable jurisdiction 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 period presented.
Net Income (Loss) 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. We have two classes of shares
which are Class A ordinary shares and Class B ordinary shares. Income and losses are shared pro rata between the two classes of ordinary
shares. Accretion associated with the redeemable Class A ordinary shares is excluded from earnings per share as the redemption value
approximates fair value.
As of March 31, 2023 and 2022, 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 income (loss)
per ordinary share for the period presented.
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 March 31, 2023 | | |
Three Months Ended March 31, 2022 | |
| |
Class A | | |
Class B | | |
Class A | | |
Class B | |
Basic and diluted net loss per ordinary share | |
| | |
| | |
| | |
| |
Numerator: | |
| | |
| | |
| | |
| |
Allocation of net income (loss), as adjusted | |
$ | 2,406,116 | | |
$ | 520,438 | | |
$ | (134,120 | ) | |
$ | (32,730 | ) |
Denominator: | |
| | | |
| | | |
| | | |
| | |
Basic and diluted weighted average shares outstanding | |
| 38,141,820 | | |
| 8,250,000 | | |
| 46,100,000 | | |
| 11,250,000 | |
| |
| | | |
| | | |
| | | |
| | |
Basic and diluted net income (loss) per ordinary share | |
$ | 0.06 | | |
$ | 0.06 | | |
$ | (0.00 | ) | |
$ | (0.00 | ) |
VECTOR ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2023
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. Any loss incurred or a lack of access to such funds could have a significant
adverse impact on the Company’s financial conditions, results of operations, and cash flows.
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,” approximate the carrying
amounts represented in the accompanying condensed balance sheets, primarily due to their short-term nature. The Company’s fair value
policy is described in Note 8.
Recent Accounting Standards
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 financial
statements.
NOTE 3. INITIAL PUBLIC OFFERING
Pursuant to the Initial Public Offering, the Company
sold 45,000,000 Public Shares, at a purchase price of $10.00 per Public Share.
NOTE 4. PRIVATE PLACEMENT
Simultaneously with the closing of the Initial
Public Offering, the Sponsor purchased an aggregate of 1,100,000 Private Placement Shares at a price of $10.00 per Private Placement Share,
for an aggregate purchase price of $11,000,000. A portion of the proceeds from the Private Placement Shares 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 Shares will be used to fund the redemption of the Public Shares (subject to
the requirements of applicable law) and the Private Placement Shares will expire worthless.
NOTE 5. RELATED PARTY TRANSACTIONS
Founder Shares
On January 11, 2021, the Sponsor paid $25,000
to cover certain offering and formation costs of the Company in consideration for 11,500,000 Class B ordinary shares (the “Founder
Shares”). On March 9, 2021, the Company effected a share capitalization pursuant to which the Company issued 1,437,500 additional
Class B ordinary shares, resulting in the Company’s initial shareholders holding 12,937,500 Class B ordinary shares. The Founder
Shares included an aggregate of up to 1,687,500 shares subject to forfeiture depending on the extent to which the underwriters’
over-allotment option is exercised, so that the number of Founder Shares equal, on an as-converted basis, approximately 20% of the Company’s
issued and outstanding ordinary shares after the Initial Public Offering (excluding the Private Placement Shares). On April 23, 2021,
the underwriters’ over-allotment option pursuant to the underwriting agreement to purchase up to 6,750,000 additional Public Shares
expired without exercise and consequently 1,687,500 Founder Shares were forfeited for no consideration.
The Sponsor has 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.
On March 8, 2023, the holders of the Company’s
outstanding Class B ordinary shares, par value $0.0001 per share, converted all outstanding Founder Shares into Class A ordinary shares.
Notwithstanding the conversions, such holders will not be entitled to receive any monies held in the Company’s trust account as
a result of their ownership of any Class A ordinary shares issued upon conversion of the founder shares.
VECTOR ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2023
Administrative Services Agreement
The Company entered into an agreement, commencing
on March 9, 2021, to pay an affiliate of the Sponsor up to $10,000 per month for office space, administrative and support services. Upon
completion of a Business Combination or its liquidation, the Company will cease paying these monthly fees. For the three months ended
March 31, 2023, the Company incurred $30,000 and accrued $30,000 in fees for these services. For the three months ended March 31, 2022,
the Company incurred and paid $30,000 in fees for these services.
Promissory Note — Related Party
On January 11, 2021, the Sponsor issued an
unsecured promissory note to the Company (the “Promissory Note”), pursuant to which the Company could borrow up to an aggregate
principal amount of $300,000. The Promissory Note was non-interest bearing and payable on the earlier of (i) June 30, 2021 or
(ii) the consummation of the Initial Public Offering. The outstanding amount of $300,000 was repaid at the closing of the Initial
Public Offering on March 12, 2021. Borrowings under the Promissory Note are no longer available.
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, provide the Company with Working Capital Loans. Such Working Capital Loans would be evidenced by Promissory
Notes. The notes may be repaid upon completion of a Business Combination, without interest, or, at the lender’s discretion, up to
$1,500,000 of notes may be converted upon completion of a Business Combination into shares of the post-business combination entity at
a price of $10.00 per share. The shares would be identical to the Private Placement Shares. 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.
On March 18, 2022, the Company entered into a working capital loan
agreement (the “Working Capital Loan Agreement”) with its Sponsor, pursuant to which the Company may borrow up to $300,000
for ongoing business expenses. As of March 31, 2023, the Company had $300,000 of outstanding borrowings under the Working Capital Loan
Agreement. On March 23, 2023, we entered into a second working capital loan agreement with our Sponsor, pursuant to which we may borrow
up to $500,000, for ongoing business expenses. As of March 31, 2023, the Company had $350,000 of outstanding borrowings under the second
working capital loan agreement. If we complete a business combination, we may repay such loaned amounts out of the proceeds of the trust
account released to us. In the event that a business combination does not close, we may use a portion of the working capital held outside
the trust account to repay such loaned amounts, but no proceeds from our trust account would be used for such repayment.
NOTE 6. COMMITMENTS AND CONTINGENCIES
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 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 these financial statements. The financial statements do not include any adjustments that might result from the outcome of
this uncertainty.
In February 2022, the Russian Federation and
Belarus commenced a military action with the country of Ukraine. As a result of this action, various nations, including the United States,
have instituted economic sanctions against the Russian Federation and Belarus. Further, the impact of this action and related sanctions
on the world economy are not determinable as of the date of these financial statements and the specific impact on the Company’s
financial condition, results of operations, and cash flows is also not determinable as of the date of these financial statements.
VECTOR ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2023
Silicon Valley Bank Closure
On March 10, 2023, Silicon Valley Bank became insolvent. State regulators
closed the bank and the Federal Deposit Insurance Corporation (“FDIC”) was appointed as its receiver. The Company held
deposits with this bank. As a result of the actions by the FDIC, the Company’s insured deposits have been restored.
Registration and Shareholders Rights
Pursuant to a registration and shareholder rights
agreement entered into on March 9, 2021, the holders of the Founder Shares, Private Placement Shares and any shares that may be issued
upon conversion of Working Capital Loans will be entitled to registration rights. The holders of these securities will be 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. However, the registration and shareholder rights agreement provides that the Company will not permit any registration statement
filed under the Securities Act to become effective until termination of the applicable lockup period.
Underwriting Agreement
The Company granted the underwriters a 45-day
option to purchase up to 6,750,000 additional Public Shares to cover over-allotments at the Initial Public Offering price, less the underwriting
discounts and commissions. On April 23, 2021, the underwriters’ over-allotment option expired without exercise and consequently
1,687,500 Founder Shares were forfeited for no consideration.
The underwriters are entitled to a deferred fee
of $0.35 per Public Share, or $15,750,000 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.
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 March 31, 2023 and December
31, 2022, there were no preference shares issued or outstanding.
Class A Ordinary Shares —
The Company is authorized to issue 450,000,000 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 December 31, 2022, there were 1,100,000 Class A ordinary shares issued
and outstanding, excluding 45,000,000 Class A ordinary shares subject to possible redemption which are presented as temporary equity.
As of March 31, 2023, there were 16,256,826 Class A ordinary shares issued and outstanding, excluding 3,906,826 Class A ordinary shares
subject to possible redemption.
Class B Ordinary Shares —
The Company is authorized to issue 50,000,000 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 December 31, 2022, there were 11,250,000 Class B ordinary shares issued
and outstanding. As of March 31, 2023, there were no Class B ordinary shares outstanding.
VECTOR ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2023
NOTE 8. FAIR VALUE MEASUREMENTS
The fair value of the Company’s financial
assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale
of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the
measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of
observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions
about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities
based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:
|
Level 1: |
Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. |
|
Level 2: |
Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. |
|
Level 3: |
Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. |
At March 31, 2023 and December 31, 2022 respectively,
assets held in the Trust Account were comprised of $40,186,567 in an interest-bearing Demand Deposit Account and $456,527,534 in money
market funds which are invested primarily in U.S. Treasury Securities. Money market funds are a level 1 asset valued based upon quoted
prices in active markets. To date, the Company has withdrawn $9,042,716 of interest earned from the Trust Account, in connection with
the redemption of Class A ordinary shares.
The following table presents information about
the Company’s assets that are measured at fair value on a recurring basis at March 31, 2023 and December 31, 2022 and indicates
the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:
Description | |
Level | | |
March 31, 2023 | | |
December 31,
2022 | |
Assets: | |
| | |
| | |
| |
Investments held in Trust Account – U.S. Treasury Securities Money Market Fund | |
| 1 | | |
$ | — | | |
$ | 456,527,534 | |
Total | |
| | | |
$ | — | | |
$ | 456,527,534 | |
NOTE 9. SUBSEQUENT EVENTS
The Company evaluated subsequent events and transactions
that occurred after the condensed balance sheet date up to the date that the unaudited condensed financial statements were issued. Based
upon this review, the Company did not identify any subsequent events that would have required adjustment or disclosure in the condensed
financial statements.