Table of Contents
 
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 
FORM
10-Q
 
☒
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended SeptemberJune 30, 20212022
OR
 
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number
001-40112
 
AUSTERLITZ ACQUISITION CORPORATION II
(Exact name of registrant as specified in its charter)
 
Cayman Islands
 
98-1583275
(State or other jurisdiction of
incorporation or organization)
 
(I.R.S. Employer
Identification Number)
  
1701 Village Center Circle,
Las Vegas, Nevada
 
89134
(Address of principal executive offices)
 
(Zip Code)
(702)
323-7330
(Registrant’s telephone number, including area code)
 
Securities registered pursuant to Section 12(b) of the Act:
 
Title of Each Class
 
Trading
Symbols
 
Name of Each Exchange
on Which Registered
Units, each consisting of one Class A Ordinary Share and
one-fourth
of one Warrant
 
ASZ.U
 
New York Stock Exchange
Share and
one-fourth
of one Warrant Class A Ordinary Shares, par value $0.0001 per share
 
ASZ
 
New York Stock Exchange
Warrants, each whole Warrant exercisable for one Class A Ordinary Share at an exercise price of $11.50 per share
 
ASZ WSASZ.WS
 
New York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes
☒    NO  ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation
S-T
(§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes
☒    NO  ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated
filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule
12b-2
of the Exchange Act.:
Large Accelerated Filerfiler ☐  Accelerated filer ☐
    
Non-accelerated
filer		 ☒  Smaller reporting company ☐
    
     Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule
12b-2
of the Exchange Act).    YES  ☒    NO  ☐
As of November 11, 2021,August 9, 2022 there were
138,000,000 shares of Class A ordinary shares, 29,571,428 shares of Class B ordinary shares and 29,571,428 shares of Class C ordinary shares of the Registrant issued and outstanding.
 
 
 
Table of Contents
AUSTERLITZ ACQUISITION CORPORATION II
FORM
10-Q
FOR THE QUARTER ENDED SEPTEMBER
JUNE 30, 20212022
TABLE OF CONTENTS
 
     
Page
 
PART 1I – FINANCIAL INFORMATION
1
Item 1.
Financial Statements
1
Condensed Balance Sheets as of June 30, 2022 (Unaudited) and December 31, 2021
1
Unaudited Condensed Statements of Operations for the Three and Six Months Ended June 30, 2022, for the Three Months Ended June 30, 2021 and for the Period from January 5, 2021 (Inception) through June 30, 2021
   2 
Item 1.
 
Unaudited Condensed Financial Statements
Condensed Balance Sheet as of September 30, 2021 (Unaudited)3
Condensed Statements of Operations for the three months ended September 30, 2021 and for the period from January 5, 2021 (inception) through September 30, 2021 (Unaudited)4
Condensed Statements of Changes in Shareholders’ Deficit for the three months ended SeptemberSix Months Ended June 30, 20212022, for the Three Months Ended June 30,2021 and for the periodPeriod from January 5, 2021 (inception)(Inception) through SeptemberJune 30, 2021 (Unaudited)3
Unaudited Condensed Statements of Cash Flows for the Six Months Ended June 30, 2022 and for the Period from January 5, 2021 (Inception) through June 30, 2021
4
Notes to Unaudited Condensed Financial Statements
   5 
Condensed Statement of Cash Flows for the period from January 5, 2021 (inception) through September 30, 2021 (Unaudited)6
Notes to Unaudited Condensed Financial Statements7
Item 2.
 
Management’s Discussion and Analysis of Financial Condition and Results of Operations
   1817 
Item 3.
 
Quantitative and Qualitative Disclosures about Market Risk
   2120 
Item 4.
 
Control and Procedures
   21 
PART II – OTHER INFORMATION
   21 
Item 1A.
 
Risk Factors
21
Item 6.
Exhibits
   22 
Item 2.
SIGNATURES
Unregistered Sales of Equity Securities and Use of Proceeds22
Item 6.
Exhibits   23 
SIGNATURES
24
2
Table of Contents
PART I -1 – FINANCIAL INFORMATION
Item 1. Financial Statements.
Item 1.
Financial Statements
AUSTERLITZ ACQUISITION CORPORATION II
CONDENSED BALANCE SHEET
SHEETS
September 30, 2021
(Unaudited)
         
   
June 30, 2022

(Unaudited)
  
December 31, 2021
 
ASSETS
         
Cash  $955  $259,366 
Prepaid expenses   359,723   542,028 
          
Total current assets
   360,678   801,394 
Cash held in Trust Account   1,380,000,000   1,380,000,000 
Forward purchase asset   375,000   —   
Other
non-current
assets
   —   80,988 
          
Total Assets
  
$
1,380,735,678
 
 
$
1,380,882,382
 
          
LIABILITIES, ORDINARY SHARES SUBJECT TO POSSIBLE REDEMPTION, AND SHAREHOLDERS’ DEFICIT
         
Current liabilities:         
Accounts payable  $162,610  $184,606 
Due to related party   344,896   204,708 
Accrued expenses   267,271   385,690 
          
Total current liabilities
   774,777   775,004 
Deferred underwriting fees payable   48,300,000   48,300,000 
Derivative warrant liabilities   6,508,000   53,148,666 
Forward purchase liability   —   500,000 
          
Total liabilities
   55,582,777   102,723,670 
          
Commitments and Contingencies (Note 6)
   0    0  
Class A ordinary shares subject to possible redemption, 138,000,000 shares at $10.00 per share   1,380,000,000   1,380,000,000 
Shareholders’ deficit
         
Preference shares, $0.0001 par value; 1,000,000 shares authorized; 0ne issued or outstanding   —   —   
Class A ordinary shares, $0.0001 par value; 800,000,000 shares authorized; 0ne issued or outstanding (excluding 138,000,000 shares subject to possible redemption)   —   —   
Class B ordinary shares, $0.0001 par value; 80,000,000 shares authorized; 29,571,428 shares issued and outstanding   2,957   2,957 
Class C ordinary shares, $0.0001 par value; 80,000,000 shares authorized; 29,571,428 shares issued and outstanding   2,957   2,957 
Additional
paid-in
capital
   —   —   
Accumulated deficit   (54,853,013)   (101,847,202) 
          
Total shareholders’ deficit
   (54,847,099)   (101,841,288) 
          
Total Liabilities, Ordinary Shares Subject to Possible Redemption, and Shareholders’ Deficit
  
$
1,380,735,678
 
 
$
1,380,882,382
 
          
 
ASSETS
     
Cash and cash equivalents
  $330,524 
Prepaid expenses
   527,867 
   
 
 
 
Total current assets
   858,391 
Cash held in Trust Account
   1,380,000,000 
Forward purchase asset
   1,500,000 
Other assets
   214,040 
   
 
 
 
Total assets
  
$
1,382,572,431
 
   
 
 
 
LIABILITIES AND SHAREHOLDERS’ DEFICIT
     
Current liabilities:
     
Accounts payable
  $24,495 
Accrued expenses
   407,287 
Due to related party
   12,450 
   
 
 
 
Total current liabilities
   444,232 
Deferred underwriting fees payable
   48,300,000 
Derivative warrant liabilities
   57,339,666 
   
 
 
 
Total liabilities
   106,083,898 
   
 
 
 
Commitments and Contingencies (Note 7)
   0  
Class A ordinary shares subject to possible redemption, 138,000,000 shares at $10.00 redemption value
   1,380,000,000 
Shareholders’ Deficit
     
Preference shares, $0.0001 par value; 1,000,000 shares authorized; NaNissued and outstanding
   0—   
Class A ordinary shares, $0.0001 par value; 800,000,000 shares authorized; NaNissued and outstanding (excluding 138,000,000 shares subject to possible redemption)
   0   
Class B ordinary shares, $0.0001 par value; 80,000,000 shares authorized; 29,571,428 shares issued and outstanding
   2,957 
Class C ordinary shares, $0.0001 par value; 80,000,000 shares authorized; 29,571,428 shares issued and outstanding
   2,957 
Additional
paid-in
capital
   0—   
Accumulated deficit
   (103,517,381) 
   
 
 
 
Total shareholders’ deficit
   (103,511,467) 
   
 
 
 
Total Liabilities and Shareholders’ Deficit
  
$
1,382,572,431
 
   
 
 
 
The accompanying notes are an integral part of these unaudited condensed financial statements.
3
1
Table of Contents
AUSTERLITZ ACQUISITION CORPORATION II
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
 
   
Three Months
Ended
September 30,
2021
  
For the period from
January 5, 2021
(inception) through
September 30, 2021
 
Formation and operating costs
  $322,515  $577,659 
   
 
 
  
 
 
 
Loss from operations
   (322,515)   (577,659) 
Other income (expense):
         
Allocation of offering costs to warrant liability
   —     (3,181,372) 
Gain on change in fair value of warrant liability
   11,241,334   29,530,334 
Gain on change in fair value of forward purchase asset
   2,375,000   1,500,000 
   
 
 
  
 
 
 
Net
i
ncome
  
$
13,293,819
 
 
$
27,271,303
 
   
 
 
  
 
 
 
   
 
 
  
 
 
 
Weighted average shares outstanding of Class A ordinary shares subject to possible redemption, basic and diluted
  
 
138,000,000
 
 
 
109,271,375
 
   
 
 
  
 
 
 
Basic and diluted net income per ordinary share, Class A ordinary shares subject to possible redemption
  
$
0.07
 
 
$
0.16
 
   
 
 
  
 
 
 
Weighted average shares outstanding of Class 
B 
non-redeemable
ordinary shares, basic and diluted
  
 
29,571,428
 
 
 
29,571,428
 
   
 
 
  
 
 
 
Basic and diluted net income per ordinary share, Class 
B
 
non-redeemable
ordinary shares
  
$
0.07
 
 
$
0.16
 
   
 
 
  
 
 
 
Weighted average shares outstanding of Class C
non-redeemable
ordinary shares, basic and diluted
  
 
29,571,428
 
 
 
29,571,428
 
   
 
 
  
 
 
 
Basic and diluted net income per ordinary share, Class C
non-redeemable
ordinary shares
  
$
0.07
 
 
$
0.16
 
   
 
 
  
 
 
 
                 
   
For The Three Months

Ended June 30, 2022
  
For The Three Months
Ended June 30, 2021
  
For The Six Months Ended
June 30, 2022
  
For The Period From

January 5, 2021

(Inception) Through

June 30, 2021
 
Formation costs  $—  $—    $—  $5,000 
General and administrative expenses   257,931   181,294   521,477   250,144 
                  
Loss from operations
   (257,931)   (181,294)   (521,477)   (255,144) 
Change in fair value of derivative warrant and forward purchase asset or liability   24,487,666   25,305,999   47,515,666   17,414,000 
Transaction costs allocation to derivative warrant liabilities   —   —     —   (3,181,372) 
                  
Net income
  $24,229,735  $25,124,705  $46,994,189  $13,977,484 
                  
Weighted average shares outstanding of Class A ordinary shares subject to possible redemption, basic and diluted   138,000,000   138,000,000   138,000,000   94,875,000 
                  
Basic and diluted net income per share, Class A subject to possible redemption
  
$
0.12
 
 
$
0.13
 
 
$
0.24
 
 
$
0.09
 
                  
Weighted average shares outstanding of Class B ordinary shares, basic and diluted   29,571,428   29,571,428   29,571,428   29,571,428 
                  
Basic and diluted net income per share, Class B ordinary shares
  
$
0.12
 
 
$
0.13
 
 
$
0.24
 
 
$
0.09
 
                  
Weighted average shares outstanding of Class C ordinary shares, basic and diluted   29,571,428   29,571,428   29,571,428   29,571,428 
                  
Basic and diluted net income per share, Class C ordinary shares
  
$
0.12
 
 
$
0.13
 
 
$
0.24
 
 
$
0.09
 
                  
The accompanying notes are an integral part of these unaudited condensed financial statements.
4
2
Table of Contents
AUSTERLITZ ACQUISITION CORPORATION II
CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS’ DEFICIT
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2022
AND FOR THE THREE MONTHS ENDED JUNE 30, 2021 AND PERIOD FROM JANUARY 5, 2021 (INCEPTION)
THROUGH
THROUGH SEPTEMBERJUNE 30, 2021
(Unaudited)
 
              
  
Ordinary Shares
           
Ordinary Shares
         
  
Class B
   
Class C
           
Class B
   
Class C
         
  
Shares
   
Amount
   
Shares
   
Amount
   
Additional Paid-

In Capital
 
Accumulated
Deficit
 
Total
Shareholders’
Deficit
   
Shares
   
Amount
   
Shares
   
Amount
   
Additional

Paid-In

Capital
 
Accumulated

Deficit
 
Total

Shareholders’

Deficit
 
Balance as of January
5, 2021 (inception)
   0     $0      0     $0     $0    $0    $0   
Issuance of Class B and Class C ordinary shares to Sponsor
   29,571,428    2,957    29,571,428    2,957    19,086   0     25,000 
Sale of Class A shares, net of $130,807,770 issuance costs
   —      —      —      —      —     —     0   
Adjustment to current redemption value of Class A redeemable shares
   —      —      —      —      (19,086)   (130,788,684)   (130,807,770) 
Balance as of January 1, 2022
  
 
29,571,428
 
  
$
2,957
 
  
 
29,571,428
 
  
$
2,957
 
  
$
—
  
$
(101,847,202
) 
 
$
(101,841,288
) 
Net income   —    —    —    —    —   22,764,454   22,764,454 
                          
Balance as of March 31, 2022
  
 
29,571,428
 
  
$
2,957
 
  
 
29,571,428
 
  
$
2,957
 
  
$
—
 
 
$
(79,082,748
) 
 
$
(79,076,834
) 
Net income   —    —    —    —    —   24,229,735   24,229,735 
Balance as of June 30, 2022
  
 
29,571,428
 
  
$
2,957
 
  
 
29,571,428
 
  
$
2,957
 
  
$
—
 
 
$
(54,853,013
) 
 
$
(54,847,099
) 
                          
  
  
Ordinary Shares
         
  
Class B
   
Class C
         
  
Shares
   
Amount
   
Shares
   
Amount
   
Additional

Paid-In

Capital
 
Accumulated

Deficit
 
Total

Shareholders’

Deficit
 
Balance as of January 5, 2021 (Inception)
  
 
—  
 
  
$
—  
   
 
—  
 
  
$
—  
   
$
—  
  
$
—  
  
$
—  
 
Issuance of ordinary shares to Sponsor   29,571,428    2,957    29,571,428    2,957    19,086   —     25,000 
Adjustment of Class A ordinary shares to redemption value   —      —      —      —      (19,086)   (130,788,684)   (130,807,770) 
Net loss
   —      —      —      —      —     (11,147,221)   (11,147,221)    —      —      —      —      —     (11,147,221)   (11,147,221) 
  
 
   
 
   
 
   
 
   
 
  
 
  
 
                           
Balance as of March 31, 2021
  
 
29,571,428
 
  
$
2,957
 
  
 
29,571,428
 
  
$
2,957
 
  
$
0  
 
 
$
(141,935,905
) 
 
$
(141,929,991
) 
  
 
29,571,428
 
  
$
2,957
 
  
 
29,571,428
 
  
$
2,957
 
  
$
—  
 
 
$
(141,935,905
) 
 
$
(141,929,991
) 
Net income
   —      —      —      —      —     25,124,705   25,124,705    —      —      —      —      —     25,124,705   25,124,705 
Balance as of June 30, 2021
  
 
29,571,428
 
  
$
2,957
 
  
 
29,571,428
 
  
$
2,957
 
  
$
—  
 
 
$
(116,811,200
) 
 
$
(116,805,286
) 
  
 
   
 
   
 
   
 
   
 
  
 
  
 
                           
Balance as of June 30, 2021
  
 
29,571,428
 
  
$
2,957
 
  
 
29,571,428
 
  
$
2,957
 
  
$
0  
 
 
$
(116,811,200
) 
 
$
(116,805,286
) 
Net income
   —      —      —      —      —     13,293,819   13,293,819 
  
 
   
 
   
 
   
 
   
 
  
 
  
 
 
Balance as of September 30, 2021
  
 
29,571,428
 
  
$
2,957
 
  
 
29,571,428
 
  
$
2,957
 
  
$
0  
 
 
$
(103,517,381
) 
 
$
(103,511,467
) 
  
 
   
 
   
 
   
 
   
 
  
 
  
 
 
The accompanying notes are an integral part of these unaudited condensed financial statements.
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Table of Contents
AUSTERLITZ ACQUISITION CORPORATION II
CONDENSED STATEMENTSTATEMENTS OF CASH FLOWS
FOR THE PERIOD FROM JANUARY 5, 2021 (INCEPTION) THROUGH SEPTEMBER 30, 2021
(Unaudited)
 
Cash Flows from Operating Activities:
     
Net income
  $27,271,303 
Adjustments to reconcile net income to net cash used in operating activities:
     
Change in fair value of warrant liability
   (29,530,334) 
Change in fair value of forward purchase asset
   (1,500,000) 
Offering cost allocated to warrant liability
   3,181,372 
Changes in operating assets and liabilities:
     
Prepaid expenses
   (527,867) 
Other assets
   (214,040) 
Accounts payable
   24,495 
Accrued expenses
   407,287 
   
 
 
 
Net cash used in operating activities
   (887,784) 
   
 
 
 
Cash Flows from Investing Activities:
     
Investment of cash into Trust Account
   (1,380,000,000) 
   
 
 
 
Net cash used in investing activities
   (1,380,000,000) 
   
 
 
 
Cash Flows from Financing Activities:
     
Advances from related party
   425,602 
Repayment of note payable and advances from related party
   (388,152) 
Proceeds from sale of Class A shares, net
   1,351,580,858 
Proceeds from sale of Private Placement Warrants
   29,600,000 
   
 
 
 
Net cash provided by financing activities
   1,381,218,308 
   
 
 
 
Net increase in cash
   330,524 
Cash - beginning of period
   0   
   
 
 
 
Cash - end of period
  $330,524 
   
 
 
 
Supplemental disclosure of noncash investing and financing activities:
     
Initial classification of forward purchase asset
  $875,000 
   
 
 
 
Initial classification of derivative warrant liabilities
  $92,592,666 
   
 
 
 
Deferred underwriting fees payable
  $48,300,000 
   
 
 
 
Issuance of Class B and Class C ordinary shares to Sponsor as settlement of due to related party
  $25,000 
   
 
 
 
Deferred offering costs included in accrued expenses
  $283,000 
   
 
 
 
Deferred offering costs paid through promissory note—related party
  $373,152 
   
 
 
 
         
   
For The Six

Months Ended

June 30, 2022
  
For The Period From

January 5, 2021

(Inception) Through

June 30, 2021
 
Cash Flows from Operating Activities
         
Net income  $46,994,189  $13,977,484 
Adjustments to reconcile net income to net cash used in operating activities:

         
Transaction costs allocated to derivative warrant liabilities   —   3,181,372 
Change in fair value of derivative warrant liability   (48,390,666)   (18,289,000) 
Loss on change in fair value of forward purchase asset or liability

   875,000   875,000 
Formation and operating expenses paid through issuance of Class B and C ordinary shares   —   5,000 
Changes in operating assets and liabilities:         
Prepaid expenses   182,305   (527,868) 
Other assets   80,988   (347,091) 
Accounts payable   (21,996)   24,527 
Accrued expense
s
   (118,419)   (796) 
Due to related party   140,188   9,301 
          
Net cash used in operating activities
   (258,411)   (1,092,071) 
          
Cash Flows from Investing Activities
         
Investment of cash into Trust Account   —   (1,380,000,000) 
          
Net cash used in investing activities
   —   (1,380,000,000) 
          
Cash Flows from Financing Activities
         
Repayment of promissory note-related party   —   (388,152) 
Proceeds from sale of Units, net of deferred underwriting discounts paid   —   1,352,400,000 
Proceeds from sale of Private Placement Warrants   —   29,600,000 
Payment of other offering costs   —   (127,990) 
          
Net cash provided by financing activities
   —   1,381,483,858 
          
Net (decrease) increase in cash
   (258,411)   391,787 
Cash—beginning of period
   259,366   —   
          
Cash—end of period
  $955  $391,787 
          
Supplemental disclosure of noncash investing and financing activities:
         
Issuance of Founder Shares to Sponsor in settlement of due to related party  $—  $25,000 
Deferred underwriting fees payable   —   48,300,000 
The accompanying notes are an integral part of these unaudited condensed financial statements.
6
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Table of Contents
AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS
Austerlitz Acquisition Corporation II (the “Company”) was incorporated as a Cayman Island exempted company on January 5, 2021. 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 that the Company has not yet identified (“Business Combination”). The Company’s sponsor is Austerlitz Acquisition Sponsor, LP II (the “Sponsor”).
As of SeptemberJune 30, 2021,2022, the Company had not yet commenced operations. All activity for the period from January 5, 2021 (inception) through SeptemberJune 30, 20212022 relates to the Company’s formation, the initial public offering, which is described below, and efforts to identify a target for a Business Combination. The Company has selected December 31 as its fiscal year end.
On March 2, 2021, the Company consummated its initial public offering (the “IPO” or “Initial Public Offering”) of 138,000,000 units (the “Units” and, with respect to the Class A ordinary shares included in the Units, the “Public Shares” and with respect to the warrants included in the Units sold the “Public Warrants”), including 18,000,000 Units sold pursuant to the full exercise of the underwriters’ option to purchase additional Units to cover over- allotments. The Units were sold at a price of $10.00 per unit, generating gross proceeds to the Company of $1,380,000,000, which is described in Note 4.
3.
Substantially concurrently
Simultaneously with the closing of the IPO, the Company completed a private sale of an aggregate 19,733,333 warrants (the “Private Placement Warrants”, and together with the Public Warrants, the “Warrants”) at a purchase price of $1.50 per Private Placement Warrant (the “Private Placement”) to Cannae Holdings, LLC, generating aggregate gross proceeds to the Company of $29,600,000, which is described in Note 5.4.
Offering costs consist of legal, accounting and other costs incurred through the balance sheet date that are directly related to the Initial Public Offering and were charged against the carrying value of the Class A ordinary shares subject to shareholders’ equitypossible redemption upon the completion of the Initial Public Offering in March 2021. Offering costs of $3,181,372 were allocated to warrant liabilities and expensed as incurred.
Following the closing of the IPO
and Private Placement
on March 2, 2021, an amount of $1,380,000,000 ($10.00 per Unit) of the proceeds from the IPO were placed in a U.S.-based,
non-interestnon-interest-bearing
bearing trust account at JP Morgan Chase Bank, N.A. maintained by Continental Stock Transfer & Trust Company, LLC, acting as trustee (the “Trust Account”). Except with respect to interest earned on the funds in the Trust Account, if any, that may be released to the Company to pay its franchise and income taxes and expenses relating to the administration of the trust account, the proceeds from the IPO and the Private Placement held in the Trust Account will not be released until the earliest of (a) the completion of a Business Combination, (b) the redemption of any public shares properly tendered in connection with a shareholder vote to amend the Company’s Amended and Restated Certificate of Incorporation (i) to modify the substance or timing of its obligation to redeem 100% of its public shares if the Company does not complete its initial business combination within 24 months from the closing of the IPO or (ii) with respect to any other provisions relating to shareholders’ rights or
pre-
initial business combination activity, and (c) the redemption of all of the Company’s public shares if it is unable to complete its business combination within 24 months from the closing of the IPO, subject to applicable law.
The Company’s management has broad discretion with respect to the specific application of the net proceeds of the IPO and the sale of the Private Placement Warrants, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. There is no assurance that the Company will be able to complete a Business Combination successfully. 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 (excluding any deferred underwriting commissions held in the Trust Account) at the time the Company signs a definitive agreement in connection with 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 of 1940, as amended.
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 general meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek shareholder approval of a Business Combination or conduct a tender offer will be made by the Company. The 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 and not previously released to the Company to pay its tax obligations. There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s warrants.Warrants.
 
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AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
STATEMENTS—(Continued)
 
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 U.S. Securities and Exchange Commission (“SEC”) and file tender offer documents with the SEC prior to completing a Business Combination. If, however, shareholder approval of the transaction is required by applicable law, or the Company decides to obtain shareholder approval for business or legal reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer rules. 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 6)5), Alignment Shares (as defined in Note 6)5) and any Public Shares purchased during or after the IPO in favor of approving a Business Combination and not to convert any shares in connection with a shareholder vote to approve a Business Combination. Additionally, each public shareholder may elect to redeem their Public Shares irrespective of whether they vote for or against the proposed transaction.
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 provide 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”)), is 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, Alignment 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 and Alignment Shares if the Company fails to consummate a Business Combination.
The Company has until March 2, 2023, which is 24 months from the closing of the IPO (the “Combination Period”), to consummate 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 ten business days thereafter, redeem 100% of the outstanding 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, if such funds are held in an interest-bearing account (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding Public Shares, which redemption will completely extinguish public shareholders’ rights as shareholders (including the right to receive further liquidation distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the remaining shareholders and the Company’s board of directors (the “Board”), liquidate and dissolve, 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 and Alignment 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 IPO, 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 7) 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 IPO price per Unit ($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 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 IPO 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 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.
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AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Liquidity and Going Concern Consideration
As of SeptemberJune 30, 2022 and December 31, 2021, the Company had $330,524$955 and $259,366 in cash, respectively, and working capital deficit and working capital of $414,159.$(414,099) and $26,390, respectively.
The Company’s liquidity needs through SeptemberJune 30, 2021,2022, were satisfied through a contribution of $25,000 from
the
Sponsor to cover certain expenses in exchange for the issuance of the Founder Shares, loans from the Sponsor, and the proceeds from the consummation of the Private Placement not held in the Trust Account. In addition, in order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the Company’s officers and directors may, but are not obligated to, provide the Company Working Capital Loans (defined below, see Note 6)5). As of SeptemberJune 30, 2022 and December 31, 2021, there were 0amounts0 amounts outstanding under the Working Capital Loans.
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Management has determined that
AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS—(Continued)
In connection with the Company’s assessment of going concern considerations in accordance with Financial Accounting Standard Board’s Accounting Standards Update (“ASU”)
2014-15,
“Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” the Company considered that it has accessuntil March 2, 2023 to funds from the Sponsor, and the Sponsor has the financial wherewithal to fund the Company,consummate a business combination. It is uncertain that are sufficient to fund its working capital needs until the consummation of a Business Combination or for a minimum of one year from the date of issuance of the financial statements. Over this time period, the Company will be using these funds for paying existing accounts payable, identifyingable to consummate a business combination by this time. If a business combination is not consummated by this date, there will be a mandatory liquidation and evaluating prospective initialsubsequent dissolution of the Company. Management has determined mandatory liquidation, should a business combination not occur, and potential subsequent dissolution raises substantial doubt about the Company’s ability to continue as a going concern. Management intends to complete the Business Combination candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selectingprior to the target businessliquidation date, however, there is no guarantee we will ultimately be able to merge with or acquire, and structuring, negotiating and consummatingconsummate a Business Combination.
No adjustments have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate after March 2, 2023.
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 the unaudited condensed financial statements. The unaudited condensed financial statements do not include any adjustments that might result from the outcome of this uncertainty.
NOTE 2. REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS
In connection with the preparation of the Company’s financial statements as of September 30, 2021, management determined it should revise its previously reported financial statements. The Company determined, at the closing of the Company’s Initial Public Offering and shares sold pursuant to the exercise of the underwriters’ overallotment, it had improperly valued its Class A ordinary shares subject to possible redemption. The Company previously determined the Class A ordinary shares subject to possible redemption to be equal to the redemption value of $10.00 per Class A ordinary share while also taking into consideration a redemption cannot result in net tangible assets being less than $5,000,001.
Management determined that the Class A ordinary shares issued during the Initial Public Offering and pursuant to the exercise of the underwriters’ overallotment can be redeemed or become redeemable subject to the occurrence of future events considered outside the Company’s control. Therefore, management concluded that the redemption value should include all Class A ordinary shares subject to possible redemption, resulting in the Class A ordinary shares subject to possible redemption being equal to their redemption value. As a result, management has noted a reclassification adjustment related to temporary equity and permanent equity. This resulted in an adjustment to the initial carrying value of the Class A ordinary shares subject to possible redemption with the offset recorded to additional
paid-in
capital (to the extent available), accumulated deficit and Class A ordinary shares. The Company will present this revision in a prospective manner in all future filings. Under this approach, the previously issued IPO Balance Sheet and Form 10-Qs will not be amended, but historical amounts presented in the current and future filings will be recast to be consistent with the current presentation.
In connection with the change in presentation for the Class A ordinary shares subject to redemption, the Company also revised its earnings (loss) per share calculation to allocate net income (loss) to our Class A, B and C ordinary shares based on each classes’ relative number of shares outstanding compared to the Company’s total shares outstanding. This presentation contemplates a Business Combination as the most likely outcome, in which case, both classes of ordinary shares share pro rata in the income (loss) of the Company.
There has been 0 change in the Company’s total assets or operating results.
The impact of the revision on the Company’s financial statements is reflected in the following tables:
   
March 2, 2021
 
   
As reported
   
Adjustment
   
Adjusted
 
Total liabilities
  $141,199,740   $2,168,658   $143,368,398 
Class A ordinary shares subject to possible redemption (temporary equity)
   1,235,359,824    144,640,176    1,380,000,000 
Shareholders’ Equity (Deficit):
               
Class A ordinary shares
   1,535    (1,535)    —   
Additional
paid-in
capital
   13,909,528    (13,909,528)    —   
Accumulated deficit
   (8,916,976)    (132,897,771)    (141,814,747) 
Total Shareholders’ Equity (Deficit)
  $5,000,001   $(146,808,834)   $(141,808,833) 
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AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
   
March 31, 2021
 
   
As reported
   
Adjustment
   
Adjusted
 
Class A ordinary shares subject to possible redemption (temporary equity)
  $1,233,070,001   $146,929,999   $1,380,000,000 
Shareholders’ Equity (Deficit):
               
Class A ordinary shares
   1,469    (1,469)    —   
Additional
paid-in
capital
   16,139,846    (16,139,846)    —   
Accumulated deficit
   (11,147,221)    (130,788,684)    (141,935,905) 
Total Shareholders’ Equity (Deficit)
  $5,000,008   $(146,929,999)   $(141,929,991) 
   
For the three months ended March 31, 2021
 
   
As reported
   
Adjustment
   
Adjusted
 
Statement of Operations
               
Net
l
oss
  $(11,147,221)   $—     $(11,147,221) 
Weighted average shares outstanding of Class A ordinary shares, basic and diluted
   138,000,000    (89,294,118)    48,705,882 
Basic and diluted net
income (
loss
)
 per ordinary share, Class A
  $—     $(0.10)   $(0.10) 
Weighted average shares outstanding of Class B and Class C
ordinary shares, basic and diluted
   59,142,856    (59,142,856)    — 
Basic and diluted net
income (
loss
)
 per Class B and Class C
ordinary share
  $(0.19)   $0.19   $— 
Weighted average shares outstanding of Class B ordinary shares,
basic and diluted
   —      29,571,428    29,571,428 
Basic and diluted net income (loss) per Class B ordinary share
  $—     $(0.10)   $(0.10) 
Weighted average shares outstanding of Class C ordinary shares,
basic and diluted
   —      29,571,428    29,571,428 
Basic and diluted net income (loss) per Class C ordinary share
  $—     $(0.10)   $(0.10) 
   
June 30, 2021
 
   
As reported
   
Adjustment
   
Adjusted
 
Total liabilities
  $118,072,033   $(1)   $118,072,032 
Class A ordinary shares subject to possible redemption (temporary equity)
   1,258,194,706    121,805,294    1,380,000,000 
Shareholders’ Deficit:
               
Class A ordinary shares
   1,218    (1,218)    —   
Retained earnings (accumulated deficit)   4,992,877    (121,804,075)    (116,811,198) 
Total Shareholders’ Equity (Deficit)  $5,000,009   $(121,804,293)   $(116,805,284) 
  
For the three months ended June 30, 2021
  
For the six months ended June 30, 2021
 
  
As reported
  
Adjustment
  
Adjusted
  
As reported
  
Adjustment
  
Adjusted
 
Statement of Operations
                        
Net
i
ncome
 $25,124,705  $—    $25,124,705  $13,977,484  $—    $13,977,484 
Weighted average shares outstanding of Class A ordinary
shares, basic and diluted
  138,000,000   —     138,000,000   138,000,000   (43,125,000)   94,875,000 
Basic and diluted net income
(loss) 
per ordinary share,
Class A
 $—    $0.13  $0.13  $—    $0.09  $0.09 
Weighted average shares outstanding of Class B and Class C ordinary shares, basic and diluted
  59,142,856   (59,142,856)  —   59,142,856   (59,142,856)  — 
Basic and diluted net income
(loss) 
per Class B and Class C
ordinary share
 $0.42  $ (0.42) $—  $0.24  $(0.24) $— 
Weighted average shares outstanding of Class B ordinary
shares, basic and diluted
  —     29,571,428   29,571,428   —     29,571,428   29,571,428 
Basic and diluted net income (loss) per Class B ordinary
share
 $—    $(0.13)  $(0.10)  $—    $0.09  $0.09 
Weighted average shares outstanding of Class C ordinary
shares, basic and diluted
  —     29,571,428   29,571,428   —     29,571,428   29,571,428 
Basic and diluted net income (loss) per Class C ordinary
share
 $—    $0.13  $(0.10)  $—    $0.09  $0.09 
NOTE 3.2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION
Basis of Presentation
The accompanying unaudited condensed financial statements are presented in U.S. dollars in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to the rules and regulations of the SEC. Accordingly, they do not include all of the information and footnotes required by GAAP. In the opinion of management, the unaudited condensed financial statements reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the balances and results for the periodperiods presented. Operating results for interim periods are not necessarily indicative of the results that may be expected for the full fiscal year.
The accompanying unaudited condensed financial statements should be read
Certain immaterial reclassifications have been made to the Condensed Consolidated Financial Statements to conform to classifications used in conjunction with the audited financial statements and notes thereto included in the final prospectus filed by the Company with the SEC on March 1, 2021 and the audited balance sheet dated March 2, 2021 included in a current report on Form 8-K filed with the SEC on March 8, 2021. 2022.
The interim results for the three and six months ended and for the period from January 5, 2021 (inception) through SeptemberJune 30, 20212022 are not necessarily indicative of the results to be expected for the periodyear ending December 31, 2021.2022.
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 of 2002, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements filed with the SEC, and exemptions from the requirements of holding a nonbinding advisory shareholder vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
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AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that an emerging growth company can elect to opt out of the extended transition period and comply with the requirements that apply to
non-emerging
growth companies but any such 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 and 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
s
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 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 unaudited condensed financial statements and the reported amounts of expenses during the reporting period.
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AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS—(Continued)
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates. Two of the more significant accounting estimates included in these financial statements are the determination of the fair values of the liabilities for the Warrants and FPA (as defined in Note 7)9). 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 had $955 and $259,366 in cash and 0 cash equivalents, as of SeptemberJune 30, 2021.
2022 and December 31, 2021, respectively.
Warrant Liability and Forward Purchase AssetLiability
The Company accounts for the Warrants and FPAForward Purchase Agreement (“FPA”) as either equity-classified or liability-classified instruments based on an assessment of the specific terms of the Warrants and FPA and the applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”)ASC 480
Distinguishing Liabilities from Equity
(“ASC 480”) and ASC 815,
Derivatives and Hedging
(“ASC 815”).815. The assessment considers whether the Warrants and FPA are freestanding financial instruments pursuant to ASC 480, meet the definition of an asset or liability pursuant to ASC 480, and meet all of the requirements for equity classification under ASC 815, including whether the Warrants and FPA are indexed to the Company’s own ordinary shares and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of issuance of the Warrants and execution of the FPA and as of each subsequent quarterly period end date while the Warrants and FPA are outstanding. For issued or modified instruments such as warrants and forward purchases of equity that meet all of the criteria for equity classification, such instruments are required to be recorded as a component of additional
paid-in
capital at the time of issuance. For issued or modified instruments that do not meet all the criteria for equity classification, such instruments are required to be recorded as liabilities at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of liability-classified instruments are recognized as a
non-cash
gain or loss on the unaudited condensed statements of operations.
The Company accounts for the Warrants and FPA in accordance with ASC
815-40
under which the Warrants and FPA do not meet the criteria for equity classification and must be recorded as an asset or liability. The Warrant liability and FPA asset or liability are included in Warrant liability and Forward purchase agreement,asset or liability, respectively, on the condensed balance sheet as of SeptemberJune 30, 2022 and December 31, 2021. See Note 98 for further discussion of the pertinent terms of the Warrants and Note 109 for further discussion of the methodology used to determine the fair value of the Company’s Warrants liability and FPA asset.asset or liability.
Offering Costs
Offering costs consisted of legal, accounting and other expenses incurred that were directly related to the Initial Public Offering were allocated to the separable financial instruments issued in the Initial Public Offering on a relative fair value basis compared to the total proceeds received. Offering costs associated with warrant liabilities were expensed as incurred in the condensed unaudited statements of operations. Offering costs associated with the Class A ordinary shares issued were charged against the carrying value of the Class A ordinary shares subject to shareholders’ deficitpossible redemption upon the completion of the Initial Public Offering.
Cash Held in Trust Account
As of SeptemberJune 30, 2022 and December 31, 2021, the assets held in the Trust Account were held in cash.
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AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
Class A Ordinary Shares Subject to Possible Redemption
The Company accounts for its Class A ordinary shares subject to possible redemption in accordance with the guidance in ASC 480
.
480. Class A Ordinary shares subject to mandatory redemption are classified as a liability and are measured at fair value. Conditionally redeemable ordinary shares (including ordinary shares that features 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 featuresfeature certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, as of SeptemberJune 30, 2022 and December 31, 2021, 138,000,000 shares of Class A ordinary shares subject to possible redemption are presented at the current redemption value as temporary equity, outside of the shareholders’ deficit section of the Company’s condensed balance sheet.sheets.
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AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS—(Continued)
As of SeptemberJune 30, 2022 and December 31, 2021, Class A ordinary shares subject to redemption reflected on the condensed balance sheetsheets are reconciled in the following table:
 
Gross proceeds from sale of Class A ordinary shares
  $
 
1,380,000,000 
Less: Allocation to public warrants
   (57,270,000) 
Less: Issuance costs attributable to Class A ordinary shares
   (73,537,770) 
Adjustment of Class A ordinary shares to redemption value
   130,807,770 
   
 
 
 
Class A ordinary shares subject to possible redemption
  
$
1,380,000,000
 
   
 
 
 
     
Gross proceeds from sale of Class A ordinary shares  $1,380,000,000 
Less:
Allocation to public warrants
   (57,270,000) 
Less:
Issuance costs attributable to Class A ordinary shares
   (73,537,770) 
Adjustment of Class A ordinary shares to redemption value   130,807,770 
      
Class A ordinary shares subject to possible redemption
  
$
1,380,000,000
 
      
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentration of credit risk consist of a cash account in a financial institution which, at times may exceed the Federal DepositoryDeposit Insurance Corporation coverage limit of $250,000. As of SeptemberJune 30, 2022 and December 31, 2021, the Company had not experienced losses on this account and management believes the Company is not exposed to significant risks on such account.
Financial Instruments
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 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.
As of SeptemberJune 30, 2022 and December 31, 2021, the carrying values of cash, accrued expenses and accrued offering costs approximate their fair values due to the
short-term
nature of the instruments. See Note 109 for further discussion of the fair value of the warrant and forward purchase asset (liabilities)(liability).
Net Income (Loss) Per Ordinary Share
The Company complies with accounting and disclosure requirements of ASC Topic 260, “Earnings
Earnings Per Share.”Share
. The Company has three classes of shares, one for each of its Class A, Class B, and Class C ordinary shares. Income and losses are shared pro rata between the three classes of shares. This presentation assumes a business combination as the most likely outcome. Net income (loss) per ordinary share is computed by dividing net income or loss by the weighted average number of ordinary shares outstanding for the period. Net income (loss) is allocated to the Company’s Class A, B and C ordinary shares based on the relative shares outstanding for each class of shares compared to the Company’s total shares outstanding. The Company has not considered the effect of the warrants sold in the IPOPublic Warrants or the Private Placement Warrants in the calculation of diluted lossincome per share, since the exercise of the warrants are contingent upon the occurrence of future events and the inclusion of such warrants would be anti- dilutive.events.
 
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AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
STATEMENTS—(Continued)
 
See Note 87 for a description of the rights of holders of each class of the Company’s ordinary shares.
The Company’s basic and diluted earnings (loss) per share are calculated as follows:
 
   
For the three
months ended
September 30,
2021
  
For the period from
January 5, 2021
(Inception) through
September 30, 2021
 
   
(Unaudited)
  
(Unaudited)
 
Redeemable Class A Ordinary Shares
   
Net earnings allocable to redeemable
C
lass A ordinary shares
  $9,305,673  $17,694,305 
   
 
 
  
 
 
 
Basic and diluted weighted average shares outstanding, redeemable
C
l
ass A ordinary shares
   138,000,000   109,271,375 
   
 
 
  
 
 
 
Basic and diluted net earnings per share, redeemable
C
lass A ordinary shares
  $0.07  $0.16 
   
 
 
  
 
 
 
Non-Redeemable
Class B and Class C Ordinary Shares
         
Net earnings allocable to non-redeemable
C
lass B ordinary shares
  $1,994,073  $4,788,499 
   
 
 
  
 
 
 
Basic and diluted weighted average shares outstanding,
non-redeemable
C
lass B ordinary shares
   29,571,428   29,571,428 
   
 
 
  
 
 
 
Basic and diluted net earnings per share,
non-redeemable
C
lass B ordinary shares
  $0.07  $0.16 
   
 
 
  
 
 
 
Net earnings (loss) attributable to non-redeemable Class C ordinary shares
  $1,994,073  $4,788,499 
Basic and diluted weighted average shares outstanding,
non-redeemable
Class C ordinary shares
   29,571,428   29,571,428 
   
 
 
  
 
 
 
Basic and diluted net earnings (loss) per share,
non-redeemable
Class C ordinary shares
  $0.07  $0.16 
   
 
 
  
 
 
 
                 
   
For The Three Months
Ended June 30, 2022
   
For The Three
Months Ended June
30, 2021
   
For The Six Months
Ended June 30, 2022
   
For The Period
From January 5,
2021 (Inception)
Through June 30,
2021
 
Class A Ordinary Shares Subject to Possible Redemption
                    
Net earnings allocable to Class A ordinary shares subject to possible redemption  $16,960,815   $17,587,293   $32,895,933   $8,610,130 
Basic and diluted weighted average shares outstanding, Redeemable Class A   138,000,000    138,000,000    138,000,000    94,875,000 
                     
Basic and diluted net earnings per share, Class A ordinary shares subject to possible redemption
  $0.12   $0.13   $0.24   $0.09 
                     
Class B Ordinary Shares
                    
Net earnings allocable to Class B ordinary shares  $3,634,460   $3,768,706   $7,049,128   $2,683,677 
Basic and diluted weighted average shares outstanding, Class B ordinary shares   29,571,428    29,571,428    29,571,428    29,571,428 
                     
Basic and diluted net earnings per share, Class B
non-redeemable
ordinary shares
  $0.12   $0.13   $0.24   $0.09 
                     
Class C Ordinary Shares
                    
Net earnings allocable to Class C Ordinary Shares  $3,634,460   $3,768,706   $7,049,128   $2,683,677 
Basic and diluted weighted average shares outstanding, Class C ordinary shares   29,571,428    29,571,428    29,571,428    29,571,428 
                     
Basic and diluted net earnings per share, Class C
non-redeemable
ordinary shares
  $0.12   $0.13   $0.24   $0.09 
                     
Income Taxes
The CompanyCompa
n
y complies with the accounting and reporting requirements of 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 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. The Company’s management does not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months.
Recent Accounting Pronouncements
In August 2020, the FASB issued Accounting Standards Update (“ASU”)
No. 2020-06,
Debt — Debt with Conversion and Other Options
, which among other things adds certain specific requirements to achieve equity classification and/or qualify for the derivative scope exception for contracts indexed to an entity’s own equity are removed, enabling more freestanding instruments and embedded features to avoid
mark-to-market
accounting. The new standard is effective for companies that are SEC filers (except for Smaller Reporting Companies) for fiscal years beginning after December 15, 2021 and interim periods within that year, and two years later for other companies. Companies can early adopt the standard at the start of a fiscal year beginning after December 15, 2020. The standard can either be adopted on a modified retrospective or a full retrospective basis. The Company is currently reviewinghas evaluated the newly issued standard and does not believe it will materially impact the Company.
Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s unaudited condensed financial statements.
10
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AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
STATEMENTS—(Continued)
NOTE 4.3. INITIAL PUBLIC OFFERING
Pursuant to the IPO, the Company sold 138,000,000 Units at a purchase price of $10.00 per Unit, including 18,000,000 Units sold pursuant to the full exercise of the underwriters’ option to purchase additional Units to cover over-allotments. Each Unit consists of one Class A ordinary sharePublic Shares and
one-fourth
of one redeemable warrant (“Public Warrant”).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 9)8).
NOTE 5.4. PRIVATE PLACEMENT
Simultaneously with the closing of the IPO, the Company completed the Private Placement of an aggregate 19,733,333 Private Placement Warrants to Cannae Holdings, LLC generating aggregate gross proceeds to the Company of $29,600,000. Each Private Placement Warrant is exercisable for 1Class1 Class A ordinary share at a price of $11.50 per share, subject to adjustment (see Note 9)8). The proceeds from the sale of the Private Placement Warrants were added to the net proceeds from the IPO 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 6.5. RELATED PARTY TRANSACTIONS
Founder Shares and Alignment Shares
On January 4, 2021, the Sponsor paid an aggregate of $25,000 in exchange for the issuance of 19,714,286 shares of Class B ordinary shares (the “Founder Shares”) and 19,714,286 shares of Class C ordinary shares (the “Alignment Shares”). On February 25, 2021, the Sponsor received a share dividend of 9,857,142 Founder Shares and 9,857,142 Alignment Shares, resulting in there being an aggregate of 29,571,428 Founder Shares and 29,571,428 Alignment Shares outstanding. As a result of the underwriters’ election to fully exercise their over-allotment option, 3,857,143
F
ounder
S
hares Founder Shares and 3,857,153 Alignment Shares are no longer subject to forfeiture.
The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of its (1) 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 capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any
30-trading
day period commencing at least 150 days after the completion of a Business Combination, or (y) the date on which the Company completes a liquidation, merger, amalgamation, stock 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; and (2) Alignment Shares and any Class A ordinary shares issued upon conversion thereof until the earlier of: (A) their conversion into Class A ordinary shares; and (B) subsequent to a Business Combination, the date on which the Company completes a merger, share exchange, reorganization or other similar transaction that results in both a change in control and all of the Company’s public shareholders having the right to exchange their ordinary shares for cash, securities or other property.
The Sponsor has agreed (a) to waive its redemption rights with respect to any Founder Shares, Alignment 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 and Alignment Shares if the Company fails to consummate a Business Combination.
The Sponsor has agreed to waive its liquidation rights with respect to the Founder Shares and Alignment Shares if the Company fails to complete a Business Combination within the Combination Period. However, any Public Shares held by the Sponsor 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 IPO price per Unit ($10.00).
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AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS—(Continued)
Promissory Note—Related Parties
On January 5, 2021, the Company issued a promissory note (the “Promissory Note”) to the Sponsor and an affiliate of the Sponsor, pursuant to which the Company could borrow up to an aggregate principal amount of $800,000. The Promissory Note was
non-interest
bearing and payable on the earlier of (i) September 30, 2021, or (ii) the completion of the IPO. The outstanding balance under the Promissory Note of $388,152 was repaid upon consummation of the IPO. The Company can 0longer borrow under the Promissory Note.
Related Party Loans
In order to finance transaction costs in connection with a Business Combination, the Sponsor, members of the Company’s founding team or any of their affiliates 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. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into up to an additional 1,000,000 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. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. To date,As of June 30, 2022 and December 31, 2021, the Company had 0 borrowings under the Working Capital Loans.
Due to Related Party
An affiliate of the Sponsor paid certain operating costs on behalf of the Company. These advances are due on demand and
non-interest
bearing. During the three
six months ended SeptemberJune 30, 2021
2022, and for the period from January 5, 2021 (inception) through SeptemberJune 30, 2021, the related party paid $3,150$203,173 and $12,450 of operating costs$14,301 on behalf of the Company, respectively. As of SeptemberJune 30, 2022 and December 31, 2021, the amount due to the related party was $12,450.$344,896 and $204,708, respectively.
Administrative Services Agreement
Commencing on February 25, 2021, the Company has agreed to pay an affiliate of its Sponsor a total of $5,000 per month for office space, utilities, secretarial and administrative support services. For the quartersix months ended June 30, 2022, and for the period ended Septemberfrom January 5, 2021 (inception) through June 30, 2021, the Company incurred and accrued $15,000$30,000 and $35,000 respectively$20,000 of administrative services under this arrangement.arrangement, respectively. Upon completion of a Business Combination or the Company’s liquidation, the Company will no longer be obligated to pay these monthly fees. As of SeptemberJune 30, 2022 and December 31, 2021, $35,000 $10,000 and $55,000
of administrative services fees were unpaid and included in accrued expensesdue to related party on the condensed balance sheet.
sheets, respectively.
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AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 7.6. COMMITMENTS AND CONTINGENCIES
Registration Rights
The holders of the Founder Shares, Alignment Shares, Private Placement Warrants, and warrants that may be issued upon conversion of Working Capital Loans (and any Class A ordinary shares issuable upon the exercise of the Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans and upon conversion of the Founder Shares and Alignment Shares) are entitled to registration rights pursuant to a registration rights agreement requiring the Company to register such securities for resale (in the case of the Founder Shares and Alignment Shares, only after conversion to the Company’s Class A ordinary shares). The holders of these securities are entitled to make up to three demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of a Business Combination. However, the registration 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. The Company will bear the expenses incurred in connection with the filing of any such registration statements.
Underwriting Agreement
The underwriters are entitled to a deferred fee of $0.35 per Unit, or $48,300,000 in the aggregate in connection with the IPO. 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.
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AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS—(Continued)
Forward Purchase Agreement
On February 25, 2021, the Company entered into a forward purchase agreement (the “FPA”) with Cannae Holdings, Inc. Pursuant to the FPA, Cannae Holdings, Inc. agreed to purchase 12,500,000 Class A ordinary shares, plus an aggregate of 3,125,000 redeemable warrants to purchase 1Class1 Class A ordinary shares at $11.50 per share, for an aggregate purchase price of $125,000,000, or $10.00 for one Class A ordinary share and
one-fourth
of one warrant, in a private placement to occur concurrently with the closing of a Business Combination. The warrants to be sold as part of the FPA will be identical to the Public Warrants.
NOTE 8.7. SHAREHOLDERS’ DEFICIT
Preference Shares
The Company is authorized to issue 1,000,000 preference shares with a par value of $0.0001 per share. The Company’s Board is authorized to fix the voting rights, if any, designations, powers, preferences, the relative, participating, optional or other special rights and any qualifications, limitations and restrictions thereof, applicable to the shares of each series. The Board is able to, without shareholder approval, issue preference shares with voting and other rights that could adversely affect the voting power and other rights of the holders of the ordinary shares and could have anti-takeover effects. As of SeptemberJune 30, 2022 and December 31, 2021, there were 0preference0 preference shares issued or outstanding.
Class A Ordinary Shares
The Company is authorized to issue 800,000,000 Class A ordinary shares with a par value of $0.0001 per share. Holders of the Company’s Class A ordinary shares are entitled to one vote for each share. As of SeptemberJune 30, 2022 and December 31, 2021, there were 0shares0 Class A ordinary shares issued and outstanding, excluding 138,000,000 Class A ordinary shares subject to possible redemption.
Class B Ordinary Shares
The Company is authorized to issue 80,000,000 Class B ordinary shares with a par value of $0.0001 per share. Holders of the Class B ordinary shares are entitled to one vote for each share. As of SeptemberJune 30, 2022 and December 31, 2021, there were 29,571,428 Class B ordinary shares issued and outstanding.
The Class B ordinary shares will automatically convert into Class A ordinary shares on the business day following the completion of a Business Combination, on a
one-for-one
basis, subject to adjustment.
Class C Ordinary Shares
The Company is authorized to issue 80,000,000 shares of Class C ordinary shares with a par value of $0.0001 per share. Holders of the Class C ordinary shares are entitled to one vote for each share. As of SeptemberJune 30, 2022 and December 31, 2021, there were 29,571,428 Class C ordinary shares issued and outstanding.
The Class C ordinary shares will automatically convert into Class A ordinary shares at the earlier of (i) a time after the completion of a Business Combination in which the last reported sale price of Class A ordinary shares for any 20 trading days within a
30-trading
day period equals or exceeds $15.25 if occurring before the third anniversary of a Business Combination, $23.00 if occurring before the sixth anniversary of a Business Combination or $35.00 if occurring before the ninth anniversary of a Business Combination, and (ii) subsequent to the completion of the Business Combination, the date on which the Company completes a merger, share exchange, reorganization or other similar transaction that results in both a change of control and all of its public shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property, in each case, on a
one-for-one
basis, subject to adjustment. The Class C ordinary shares will be returned to the Company for cancellation in the event that they have not converted into Class A ordinary shares nine years after a Business Combination.
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Table of Contents
AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 9.8. WARRANTS
As of SeptemberJune 30, 2022 and December 31, 2021, there were 34,500,000 Public Warrants outstanding. Each whole Warrant entitles the registered holder to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment as discussed below, at any time commencing 30 days after the completion of an initial business combination, provided that an effective registration statement under the Securities Act covering the issuance of the Class A ordinary shares issuable upon exercise of the Warrants and a current prospectus relating to them is available (or we permit holders to exercise their Warrants on a cashless basis under the circumstances specified in the warrant agreement) and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder. Pursuant to the warrant agreement, a warrant holder may exercise its warrants only for a whole number of the Company’s Class A ordinary shares. This means only a whole warrant may be exercised at a given time by a warrant holder. No fractional warrants will be issued upon separation of the
U
nits, Units, no cash will be paid in lieu of fractional warrants and only whole warrants will trade.
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Table of Contents
AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS—(Continued)
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:
 
in whole and not in part;
 
at a price of $0.01 per warrant;
 
upon a minimum of 30 days’ prior written notice of redemption to each warrant holder; and
 
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
three business days before sending the notice of redemption to the warrant holders (the “Reference Value”) equals or exceeds $18.00 per share (as adjusted for share
sub-divisions,
share capitalizations, reorganizations, recapitalizations and the like).
If and when the warrants become redeemable by the Company, the Company may exercise its redemption right even if it is unable to register or qualify the underlying securities for sale under all applicable state securities laws. However, the Company will not redeem the warrants unless an effective registration statement under the Securities Act covering the Class A ordinary shares issuable upon exercise of the warrants is effective and a current prospectus relating to those Class A ordinary shares is available throughout the
30-day
redemption period.
Redemption of Warrants when the price per Class
 A ordinary share equals or exceeds $10.00:
Once the Warrants become exercisable, the Company may redeem the outstanding Public 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 of Class A ordinary shares to be determined by reference to an agreed table based on the redemption date and the “fair market value” of shares of Class A ordinary shares;
 
if, and only if, the Reference Value equals or exceeds $10.00 per share (as adjusted for share
sub-divisions,
share dividends, reorganizations, recapitalizations and the like); and
if the Reference Value is less than $18.00 per share (as adjusted for share
sub-divisions,
share dividends, reorganization, recapitalizations and the like) the Private Placement Warrants must also be concurrently called for redemption on the same terms as the outstanding Public Warrants, as described above.
The exercise price and number of ordinary shares issuable upon exercise of the Public Warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend or recapitalization, reorganization, merger or consolidation. However, except as described below, the Public Warrants will not be adjusted for issuances of ordinary shares at a price below its exercise price. 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 ordinary share (with such issue price or effective issue price to be determined in good faith by the Company’s Board, and in the case of any such issuance to the Sponsor or its affiliates, without taking into account any Founder Shares and Alignment 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 completion of a Business Combination (net of redemptions), and (z) the volume weighted average trading price of the Company’s Class A ordinary shares during the 20 trading day period starting on the trading day prior to the day on which the Company consummates a Business Combination (such price, the “Market Value”) is below $9.20 per share, the exercise price of the Public 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 $10.00 and $18.00 per share redemption trigger prices described above under “Redemption of Warrants When the Price per Class A Ordinary Share Equals or Exceeds $18.00” and “Redemption of Warrants When the Price per Class A Ordinary Share Equals or Exceeds $10.00” will be adjusted (to the nearest cent) to be equal to 100% and 180% of the higher of the Market Value and the Newly Issued Price, respectively.
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AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS—(Continued)
As of SeptemberJune 30, 2022 and December 31, 2021, there were 19,733,333 Private Placement Warrants outstanding. The Private Placement Warrants are identical to the Public Warrants underlying the Units sold in the IPO, except that (x) the Private Placement Warrants and the Class A ordinary shares issuable upon the exercise of the Private Placement Warrants are not transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions, (y) the Private Placement Warrants will be exercisable on a cashless basis and be
non-redeemable
so long as they are held by the initial purchasers or their permitted transferees and (z) the Private Placement Warrants and the Class A ordinary shares issuable upon exercise of the Private Placement Warrants will be entitled to registration rights. 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.
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Table of Contents
AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 10.9. FAIR VALUE MEASUREMENTS
Warrant Liabilities and Forward Purchase Agreement AssetLiability
The Warrants and FPA are accounted for as a liability and the FPA is accounted for as an assetliabilities pursuant to ASC
815-40
and measured at fair value as of each reporting period. Changes in the fair value of the Warrants and FPA are recorded in the statementcondensed statements of operations each period.
The following table presents the fair value hierarchy for assets and liabilities measured at fair value on a recurring basis as of SeptemberJune 30, 2021:2022:
 
   
Level 1
   
Level 2
   
Level 3
   
Total
 
Assets:
        
Forward Purchase Agreement
  $0     $0   $1,500,000   $1,500,000 
   
 
 
   
 
 
   
 
 
   
 
 
 
Total assets
  $0   $0   $1,500,000   $1,500,000 
   
 
 
   
 
 
   
 
 
   
 
 
 
Liabilities:
                    
Public Warrants
  $36,225,000   $0     $0     $36,225,000 
Private Placement Warrants
   0      0    21,114,666    21,114,666 
   
 
 
   
 
 
   
 
 
   
 
 
 
Total liabilities
  $36,225,000   $0   $21,114,666   $57,339,666 
   
 
 
   
 
 
   
 
 
   
 
 
 
                 
   
Level 1
   
Level 2
   
Level 3
   
Total
 
Assets:
                    
Forward Purchase Asset  $—   $—   $375,000   $375,000 
                     
Total assets  $—   $—   $375,000   $375,000 
                     
Liabilities:
                    
Public Warrants  $4,140,000   $—   $—   $4,140,000 
Private Placement Warrants   —    2,368,000    —    2,368,000 
                     
Total liabilities  $4,140,000   $2,368,000    —   $6,508,000 
                     
The assetfollowing table presents the fair value hierarchy for liabilities measured at fair value on a recurring basis as of December 31, 2021:
                 
   
Level 1
   
Level 2
   
Level 3
   
Total
 
Liabilities:
                    
Public Warrants  $33,810,000   $—     $—     $33,810,000 
Private Placement Warrants   —      19,338,666    —      19,338,666 
Forward Purchase Liability   —      —      500,000    500,000 
                     
Total liabilities  $33,810,000   $19,338,666   $500,000   $53,648,666 
                     
The liability for the FPA was valued using the time-discounted spread of the fixed purchase price of the Company’s units pursuant to the FPA over the public trading price of the Company’s Units and is considered to be a Level 23 fair value measurement. The valuation is then adjusted to reduce the value of the FPA for the probability of consummation of the Business Combination. The model utilizes key inputs including the probability of consummation of a Business Combination, volatility of the underlying units, risk free interest rates based on US treasury rates and the expected time to consummation of a Business Combination based on the probability of consummation. The primary unobservable input utilized in determining the fair value of the FPA is the probability of consummation of the Business Combination. The probability assigned to the consummation of a Business Combination was 90%50% which was determined based upon a hybrid approach of both observed success rates of business combinations for special purpose acquisition companies and the Sponsors’Sponsor’s track record for consummating similar transactions.
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AUSTERLITZ ACQUISITION CORPORATION II
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS—(Continued)
Upon consummation of the IPO on March 2, 2021, the Company’s Warrants were classified as Level 3 due to unobservable inputs used in the initial valuation. On April 23, 2021, the Public Warrants surpassed the
52-day
threshold waiting period to be publicly traded in accordance with the Prospectus filed March 1, 2021. Once publicly traded, the observable input qualifies the liability for treatment as a Level 1 liability. As such, as of September 30, 2021, the Company classified the Public Warrants as Level 1.
The Private Placement Warrants were valued usingare subject to a Black Scholes Model which utilizes Level 3 fair value inputs. The valuation uses a Black Scholes Option Pricing Model. The model utilizes key inputs includingcall alongside the exercise strikePublic Warrants, it is assumed that the trading price implied volatility of the underlying securities, risk free interest rates based on US treasury rates, and expiration datepublic warrants is reflective of the warrants based on the contractual warrant terms. The primary unobservable input utilized in determining the fair value of the Private Placement Warrants. Accordingly, the Company classified the Private Placement Warrants as of September 30, 2021 isLevel 2.
Initially, the implied volatility of the underlying security. The implied volatility used in calculating theestimated fair value of the warrant liability was determined using Level 3 inputs. The subsequent measurements of the Public Warrants after the detachment of the Public Warrants from the Units is classified as Level 1 due to the use of an observable market quote in an active market which began in the quarter ended June 30, 2021. As of June 30, 2022 and December 31, 2021, the closing price of the Public Warrant was used as the fair value for the Private Warrants. As such, at December 31, 2021, the Private Placement Warrants was 16.1% and was determined usingwere transferred to Level 2 due to a call lattice model.make-whole provision which allows the Company to use the value of the closing price of the Public Warrants.
The following table presents a summary of the changes in the fair value of the Company’s assets (liabilities) measured using level 3 fair value inputs:inputs as of June 30, 2022:
 
   
FPA
   
Public Warrant
Liability
   
Private Placement

Warrant Liability
 
Fair value, March 2, 2021 (unaudited)
  $0     $(57,270,000)   $(35,322,666) 
Loss on change in fair value
   0      (1,380,000)    (789,333) 
   
 
 
   
 
 
   
 
 
 
Fair value, March 31, 2021 (unaudited)
   0      (58,650,000)    (36,111,999) 
Gain (loss) on change in fair value
   (875,000)    0      10,655,999 
Transfer to level 1
   0      58,650,000    0   
   
 
 
   
 
 
   
 
 
 
Fair value, June 30, 2021 (unaudited)
   (875,000)    0      (25,456,000) 
Gain (loss) on change in fair value
   2,375,000    0      4,341,334 
   
 
 
   
 
 
   
 
 
 
Fair value, September 30, 2021
  $1,500,000   $0     $(21,114,666) 
   
 
 
   
 
 
   
 
 
 
     
   
FPA
 
Fair value, January 1, 2022  $(500,000) 
Change in fair value   250,000 
      
Fair value, March 31, 2022  
(250,000) 
Change in fair value  
625,000 
Fair value, June 30, 2022  $375,000 
      
The following table presents a summary of the changes in the fair value of the Company’s assets (liabilities) measured using level 3 fair value inputs as of December 31, 2021:
             
   
FPA
   
Public
Warrant
   
Private
Warrant
 
Fair value, March 2, 2021  $—     $—     $—   
Issuance of warrants   —      (57,270,000)    (35,322,666) 
Change in fair value   (500,000)    (1,380,000)    14,208,000 
Transfer to level 1   —      58,650,000    —   
Transfer to level 2   —      —      21,114,666 
Fair value, December 31, 2021  $(500,000)   $—     $—   
                
Gain on change in fair value of warrant liability, including change in fair value of forward purchase asset or liability on the unaudited condensed statementstatements of operations for the six months ended June 30, 2022 and for the period ended Septemberfrom January 5, 2021 (inception) through June 30, 2021 also includes a lossgain of $5,722,666 recognized on the excess of the fair value of the Private Placement Warrants as of March 2, 2021 over the cash received.
$47,515,666 and $17,414,000, respectively.
NOTE 11.10. SUBSEQUENT EVENTS
In accordance with ASC Topic 855,
Subsequent Events
, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before the unaudited condensed financial statements are issued, the Company evaluated subsequent events that occurred after the condensed balance sheet date up to the date the unaudited condensed financial statements were available to be issued and has concluded that allno such eventevents that would require adjustment or disclosure have been recognized or disclosed.occurred.
 
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ITEMItem 2.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Management
’
s Discussion and Analysis of Financial Condition and Results of Operations
References in this report (the “Quarterly Report”) to “we,” “us” or the “Company” refer to Austerlitz Acquisition Corporation II. References to our “management” or our “management team” refer to our officers and directors, references to the “Sponsor” refer to Austerlitz Acquisition Sponsor, LP II.I. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the unaudited condensed financial statements and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.
Special Note Regarding Forward-Looking Statements
This Quarterly Report includes “forward-looking statements” that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact included in this Quarterly Report including, without limitation, statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors section of the Company’s final prospectus Annual Report on Form
10-K
for its IPO filed with the year ended December 31, 2021 and in any of the Company’s subsequent SEC and Part II, Item 1A “Risk Factors” below.filings. The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.
Overview
We are a blank check company incorporated on January 5, 2021 as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar Business Combination with one or more businesses. We intend to effectuate a Business Combination using cash from the proceeds of our IPO and the Private Placement, the proceeds of the sale of our shares in connection with a Business Combination, shares issued to the owners of the target, debt issued to bank or other lenders or the owners of the target, or a combination of the foregoing.
The registration statement for our IPO was declared effective on February 25, 2021. On March 2, 2021, we completed our IPO of 138,000,000 Units sold to the public, including the issuance of 18,000,000 Units as a result of the underwriter’s exercise in full of its over-allotment option, at the price of $10.00 per Unit, generating gross proceeds of $1,380,000,000. Each Unit consists of one Class A ordinary share of the Company and
one-fourth
of one redeemable 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. Simultaneously with the closing of our IPO, we completed the sale to Cannae Holdings, LLC of an aggregate of 19,733,333 Private Placement Warrants at a price of $1.50 per Private Placement Warrant, generating gross proceeds of approximately $29,600,000. Each Private Placement Warrant is exercisable for one Class A ordinary share at a price of $11.50 per share, subject to adjustment. The proceeds from the Private Placement were added to the net proceeds from the IPO held in the Trust Account.
Following our IPO, the full exercise of the over-allotment option and the Private Placement, a total of $1,380,000,000 was placed in the Trust Account. We incurred $28,359,571 in transaction costs, including $27,600,000 of underwriting fees and $759,571 of other offering costs.
The Company’s management has broad discretion with respect to the specific application of the net proceeds of the IPO and the sale of the Private Placement Warrants, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. There is no assurance that the Company will be able to complete a Business Combination successfully. 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 (excluding any deferred underwriting commissions held in the Trust Account) at the time the Company signs a definitive agreement in connection with 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 of 1940, as amended.
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We expect to continue to incur significant costs in the pursuit of our initial Business Combination. We cannot assure you that our plans to complete a Business Combination will be successful.
The
COVID-19
In Marchpandemic has caused difficult market and economic conditions globally since its outbreak in 2020, and the World Health Organization classified the
COVID-19
outbreak as a pandemic, based on the rapid increase in exposure globally. The full impact of the
COVID-19
outbreakpandemic continues to evolve. The impact of the
COVID-19
outbreak on our results of operations, financial position and cash flows will depend on future developments, including the durationresurgences and spreadvariants of the outbreakvirus that causes
COVID-19,
as well as efforts to reduce its spread, such as travel bans and related advisories andother restrictions. These developments and the impact of the
COVID-19
outbreak on the financial markets and the overall economy are highly uncertain and cannot be predicted. If the financial markets and/or the overall economy continue to be impacted for an extended period, our ability to complete our initial Business Combination may be materially adversely affected due to significant governmental measures being implemented to contain the
COVID-19
outbreakpandemic or treat its impact, including travel restrictions, the shutdown of businesses and quarantines, among others, which may limit our ability to have meetings with potential investors or affect the ability of a potential target company’s personnel, vendors and service providers to negotiate and consummate our initial Business Combination in a timely manner.
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Results of Operations
We have neither engaged in any operations nor generated any revenues to date. Our only activities since inception have been organizational activities, those necessary to prepare for our IPO and, after completing our IPO, identifying a target company for a Business Combination. We do not expect to generate any operating revenues until after completion of a Business Combination. We may generate
non-operating
income in the form of interest income on marketable securities held in the Trust Account. We incur expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as expenses as we conduct due diligence on prospective Business Combination candidates. Additionally, we recognize
non-cash
gains and losses related to changes in recurring fair value measurements of our Warrant liabilities at each reporting period.
For the period from January 5, 2021 (inception) through Septembersix months ended June 30, 2021,2022, we had net income of $27,271,303,$46,994,189, which consists of $521,477 in general and administrative expenses, offset by
non-cash
gains of $31,030,334$47,515,666 related to changes in the fair value of the Warrantswarrants and the FPA, less $3,181,372 in offering costs allocated to warrant liabilities, less operating costs of $577,659.
forward purchase agreement. For the quarter ending Septemberperiod from January 5, 2021 (Inception) through June 30, 2021, we had net income of $13,293,819$13,977,484, which consistsconsisted of $250,144 in general and administrative costs, $5,000 of formation costs, $3,181,372 related to transaction costs allocated to derivative warrant liabilities, offset by
non-cash
gains of $13,616,334$17,414,000 related to changes in the fair value of the Warrantswarrants and FPA, less operatingforward purchase agreement,
For the three months ended June 30, 2022, we had net income of $24,229,735, which consists of $257,931 in general and administrative costs, offset by
non-cash
gains of $322,515.$24,229,735 related to changes in the fair value of the warrants and forward purchase agreement. For the three months ended June 30, 2021, we had net income of $25,124,705, which consisted of $181,294 in general and administrative expenses and
non-cash
gains of $25,305,999 related to changes in the fair value of the warrants and forward purchase agreement.
Liquidity and Capital Resources
As of SeptemberJune 30, 2021,2022, we had cash of $330,524$955 outside of the Trust Account.
As of June 30, 2022, we had cash of $1,380,000,000 held in the Trust Account. We intend to use substantially all of the funds held outsidein the Trust Account primarily(less taxes paid and deferred underwriting commissions) to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel and structure, negotiate and complete a Business Combination. To the extent that our capital stock or debt is used, in whole or in part, as consideration to complete a 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.
In order to fund working capital deficiencies or finance transaction costs in connection with our initial Business Combination, our Sponsor or an affiliate of our Sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. If we complete our initial Business Combination, we would repay such loaned amounts. In the event that our initial 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. Up to $1,500,000 of such loans may be convertible into warrants identical to the Private Placement Warrants, at a price of $1.50 per warrant at the option of the lender.
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We do not currently believeexpect that financial support of our Sponsor will be sufficient to operate our business through the earlier of a Business Combination or March 2, 2023, the date of our mandatory liquidation should we will needfail to raise additional funds in order to meet the expenditures required for operating our business.consummate a Business Combination. However, if our estimate of the costs of identifying a target business, undertaking
in-depth
due diligence and negotiating our initial Business Combination are more than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our initial Business Combination. Moreover, we may need to obtain additional financing either to complete our initial Business Combination or because we become obligated to redeem a significant number of our Public Shares upon consummation of our initial Business Combination, in which case we may issue additional securities or incur debt in connection with such Business Combination. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our initial Business Combination. If we are unable to complete our initial Business Combination because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the Trust Account. In addition, following our initial Business Combination, if cash on hand is insufficient, we may need to obtain additional financing in order to meet our obligations.
For the period from January 5, 2021 (inception) through Septembersix months ended June 30, 2021,2022, cash used inby operating activities was $887,784.$258,411. Net income of $27,271,303$46,994,189 was affected by
non-cash
gains of $31,030,334$48,390,666 related to changes in the fair value of Warrants and FPA, lossesderivative warrant liabilities, loss of $3,181,372$875,000 related to offering costs allocated to warrant liabilitieschange in fair value of forward purchase asset or liability, and changes in operating assets and liabilities, which used $310,125$263,066 of cash from operating activities.
As of SeptemberFor the period from January 5, 2021 (Inception) through June 30, 2021, wecash used by operating activities $1,092,071. Net income of $13,977,484 was affected by $3,181,372 in transaction costs allocated to derivative warrant liabilities, $18,289,000 of
non-cash
gains in the fair value of derivative warrant liabilities, $875,000 related to loss change in fair value of forward purchase liability, $5,000 related to formation and operating expenses paid through issuance of Class B and C ordinary shares, and changes in operating assets and liabilities, which used $841,927 of cash from operating activities.
The Company had no cash and marketable securitiesflow from investing or financing activities in the six months ended June 30, 2022.
For the six months ended June 30, 2021, net cash used in investing activities was $1,380,000,000, which consisted of $1,380,000,000 heldinvestment of cash into the trust account. Net cash provided by financing activities of $1,381,483,858 was affected by $388,152 of repayment of promissory note – related party, $127,990 of offering costs paid, and offset by $1,352,400,000 of proceeds from sale of Units, net of deferred underwriting discounts paid, and $29,600,000 of proceeds from the sale of Private Placement Warrants.
See discussion under the header “Liquidity and Going Concern Consideration” in the Trust Account. We intendNote 1 to use substantially allour unaudited condensed financial statements included in Item 1 of Part I of this Quarterly Report for discussion of management’s consideration of the funds held in the Trust Account (less taxes paid and deferred underwriting commissions)Company’s ability to completecontinue as a Business Combination. To the extent that our capital stock or debt is used, in whole or in part, as consideration to complete a 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.going concern.
Off-Balance
Sheet Financing Arrangements
We havehad no obligations, assets or liabilities, which would be considered
off-balance
sheet arrangements as of SeptemberJune 30, 2022 or December 31, 2021. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities. We have not entered into any
off-balance
sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any
non-financial
assets.
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Contractual Obligations
We do not have any
long-term
debt, capital lease obligations, operating lease obligations or long-term liabilities, other than an agreement to pay an affiliate of our sponsor a monthly fee up to $5,000 for office space and administrative support services. We began incurring these fees on March 2, 2021 and will continue to incur these fees monthly until the earlier of the completion a Business Combination and our liquidation.
Refer to Note 7 to the financial statements included in Item 1 of Part I of this Quarterly Report for further discussion of our obligations under the Registration Rights Agreement and FPA.
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 general meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek shareholder approval of a Business Combination or conduct a tender offer will be made by the Company. The 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 and not previously released to the Company to pay its tax obligations. There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s warrants. The Class A ordinary shares are recorded at redemption value and classified as temporary equity, in accordance with Accounting Standards Codification (“ASC”) Topic 480,
Distinguishing Liabilities from Equity
(“ASC 480.480”).
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Critical Accounting Estimates
The preparation of unaudited condensed financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during the period reported. Actual results could materially differ from those estimates. We have identified the following critical accounting estimates effecting our financial statements:
Warrant Liabilities and Forward Purchase AssetsLiabilities
The Company accounts for the Warrants and FPAForward Purchase Agreement (“FPA”) as either equity-classified or liability-classified instruments based on an assessment of the specific terms of the Warrants and FPA and the applicable authoritative guidance in ASC 480 and ASC 815.Topic 815,
Derivatives and Hedging
(“ASC 815”). The assessment considers whether the Warrants and FPA are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and meet all of the requirements for equity classification under ASC 815, including whether the Warrants and FPA are indexed to the Company’s own ordinary shares and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of issuance of the Warrants and execution of the FPA and as of each subsequent quarterly period end date while the Warrants and FPA are outstanding. For issued or modified instruments such as warrants and forward purchases of equity that meet all of the criteria for equity classification, such instruments are required to be recorded as a component of additional
paid-in
capital at the time of issuance. For issued or modified instruments that do not meet all the criteria for equity classification, such instruments are required to be recorded as liabilities at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of
liability-classified
instruments are recognized as a
non-cash
gain or loss on the unaudited condensed statements of operations.
The Company accounts for the Warrants and FPA in accordance with ASC
815-40
under which the Warrants and FPA do not meet the criteria for equity classification and must be recorded as assets or liabilities. The assets and liabilities for the Warrants and FPA are included in Warrant liability and Forward purchase agreement asset or liability, respectively, on the condensed balance sheet as of SeptemberJune 30, 2022 and December 31, 2021.
See Note 98 to our unaudited condensed financial statements included in Item 1 of Part I of this Quarterly Report for further discussion of the pertinent items of the Warrants and Note 109 for further discussion of the methodology used to determine the fair value of the Company’s liabilities for the Warrants and FPA.
Class A Ordinary Shares Subject to Possible Redemption
We account for our Class A ordinary shares subject to possible redemption in accordance with the guidance in ASC 480. Class A ordinary shares subject to mandatory redemption are classified as a liability instrument and is 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 our control) are classified as temporary equity. At all other times, ordinary shares are classified as shareholders’ equity. Our Class A ordinary shares feature certain redemption rights that are considered to be outside of our control and subject to occurrence of uncertain future events. Accordingly, the Class A ordinary shares subject to possible redemption are presented as temporary equity, outside of the shareholders’ equity section of our unaudited condensed balance sheet.sheets.
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Net Income (Loss) per Ordinary Share
The Company has three classes of shares, one for each of its Class A, Class B, and Class C ordinary shares. Income and losses are shared pro rata between the three classes of shares. Net income per ordinary share is computed by dividing net income by the weighted average number of ordinary shares outstanding during the period. We apply the
two-class
method in calculating earnings per share. Refer to Note 32 to our unaudited condensed consolidated financial statements included in Item 1 of Part 1I of this Quarterly Report for further discussion of the calculation of our net lossincome per share.
Recently Issued Accounting Pronouncements
Refer to Note 32 to our unaudited condensed consolidated financial statements included in Item 1 of Part 18 of this Quarterly Report for discussion of management’s consideration of recently issued accounting pronouncements.
Revision of Previously Issued Financial Statements
Refer to Note 2 to our condensed consolidated financial statements included in Item 1 of Part 1 of this Quarterly Report for discussion of revisions to the Company’s previously issued financial statements related to our accounting for the value of our redeemable Class A ordinary shares presented in temporary equity and our calculation of net income (loss) per ordinary share.
 
ITEM 3.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
As of SeptemberJune 30, 2021,2022, we were not subject to any market or interest rate risk. Following the consummation of our IPO, the net proceeds received into the Trust Account, have been placed in a
non-interest
bearing checking account.
 
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ITEM 4.
CONTROLS AND PROCEDURES
Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management was required to apply its judgment in evaluating and implementing possible controls and procedures.
Evaluation of Disclosure Controls and Procedures
As required by Rules
Rules 13a-15
and
15d-15
under the Exchange Act, our Chief Executive Officer and Chief Financial Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of SeptemberJune 30, 2021.2022. Based upon their evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures (as defined in Rules
Rules 13a-15 (e)
(e) and
15d-15
(e) under the Exchange Act) were effective.not effective, due to the material weakness in our internal control over financial reporting related to the Company’s accounting for complex financial instruments as described in the Explanatory Note in our Quarterly Report Form
10-Q/A
filed on January 10, 2022 and in the footnotes to the financial statements included in our Quarterly Report on Form
10-Q
for the fiscal quarter ended March 31, 2021, as filed with the SEC on May 17, 2021. As a result, we performed additional analyses as deemed necessary to ensure that our financial statements were prepared in accordance with U.S. generally accepted accounting principles. Management believes that the financial statements included in this Quarterly Report present fairly in all material respects our financial position, results of operations and cash flows for the periods presented.
We do not expect that our disclosure controls and procedures will prevent all errors and all instances of fraud. Disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Further, the design of disclosure controls and procedures must reflect the fact that there are resource constraints, and the benefits must be considered relative to their costs. Because of the inherent limitations in all disclosure controls and procedures, no evaluation of disclosure controls and procedures can provide absolute assurance that we have detected all our control deficiencies and instances of fraud, if any. The design of disclosure controls and procedures also is based partly on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.
Changes in Internal Control Overover Financial Reporting
There
Other than the steps taken to remediate the material weakness identified in prior periods and further described below, there was no change in our internal control over financial reporting that occurred during the fiscal quarter ended SeptemberJune 30, 2021 covered by this Quarterly Report on
Form 10-Q2022 that
has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. The
We have previously identified a material weakness discussed below was remediated during the quarter ended September 30, 2021.
Remediation of a Material Weakness in Internal Control over Financial Reporting
We recognize the importance of the control environment as it sets the overall tone for the Company and is the foundation for all other components of internal control. Consequently, we designed and implemented remediation measures to address the material weakness previously identified and enhance our internal control over financial reporting. In lightThe material weakness was due to management’s review of the material weakness, we enhancedaccounting treatment for the financial instruments issued in the initial public offering and sold in the concurrent private placement. Management’s review was insufficient to identify a classification error that led to our restatement of our financial statements, as described in Note 2 to our Quarterly Report Form
10-Q/A
filed on January 10, 2022. Management has made changes in its internal control over financial reporting to enhance our processes to identify and appropriately apply applicable accounting requirements to better evaluate and understand the nuances of the complex accounting standards that apply to our condensed unaudited financial statements, including providing enhanced access to accounting literature, research materials and documents and increased communication among our personnel and third-party professionals with whom we consult regarding complex accounting applications. We are in the process of validating that those processes and controls are operating effectively. The foregoing actions, which we believe remediatedCompany can offer no assurance that these changes will ultimately have the material weakness in internal control over financial reporting, were
completed asintended effects. As of the date of June 30, 2021.this Quarterly Report, the material weakness has not been remediated.
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PART II -– OTHER INFORMATION
ITEM 1A. RISK FACTORS.
Factors that could cause our actual results to differ materially from those in this Quarterly Report are any of the risks described in our final prospectus for our IPO filed with the SEC on February 25, 2021. Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations.
 
ITEM 2.1A.
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.RISK FACTORS.
UseThere have been no material changed to our risk factors as disclosed in “Risk Factors” included in Item 1A of Proceeds
On March 2, 2021, we consummatedPart I of our Initial Public Offering of 138,000,000 Units, inclusive of 18,000,000 Units sold pursuant to the underwriters’ election to fully exercise their over-allotment option. The Units were sold at an offering price of $10.00 per Unit, generating total gross proceeds of $1,467,033,450. The securities sold in the offering were registered under the Securities Act on registration statementAnnual Report on Form
S-110-K
(No.
333-252933).
The SEC declaredfor the registration statement effective on February 25,year ended December 31, 2021.
Of the gross proceeds received from the Initial Public Offering, $1,380,000,000 was placed in the Trust Account.
 
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ITEM 6.
EXHIBITS.
The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form
10-Q.
 
No.
  
Description of Exhibit
    3.1Amended and Restated Memorandum and Articles of Association. (1)
31.1*  Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*  Certification of Chief Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**  Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes- Oxley Act of 2002.
32.2**  Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*  Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)
101.SCH*  Inline XBRL Taxonomy Extension Schema Document
101.CAL*  Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*  Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*  Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE*  Inline XBRL Taxonomy Extension Presentation Linkbase Document
104  Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
 
*
Filed herewith.
**
Furnished.
 
(1)
Previously filed as an exhibit to our Current Report on Form
8-K
filed on March 3, 2021 and incorporated by reference herein.
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SIGNATURES
Pursuant to the requirements of Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
  
AUSTERLITZ ACQUISITION CORPORATION II
Date: November 12, 2021August 10, 2022   
/s/ David W. Ducommun
  Name: David W. Ducommun
  Title: President
   (
Principal Executive Officer
)
Date: November 12, 2021August 10, 2022   
/s/ Bryan Coy
  Name: Bryan Coy
  Title: Chief Financial Officer
   
(Principal Financial and Accounting Officer)
 
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