Basis of presentation

Basis of Presentation. These Condensed Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Certain information and disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted in these interim financial statements. Accordingly, these Financial Statements should be read in conjunction with our annual financial statements as of and for the year ended December 31, 2020.

In our opinion, the Financial Statements have been prepared on the same basis as the annual financial statements and include all adjustments, consisting of only normal recurring adjustments, necessary for fair presentation. Certain immaterial prior period amounts, specifically warrant remeasurement, has been reclassified to conform to current period presentation. The results of operations for the three and nine months ended September 30, 2021, are not necessarily indicative of the results of operations to be expected for the full year ended December 31, 2021. All dollar amounts (other than per share amounts) in the following disclosures are in thousands of United States dollars, unless otherwise indicated.

Basis of Presentation. Our Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

Investments in Available-for-Sale Securities

Management classifies investments in fixed maturity securities at the acquisition date and reevaluates the classification at each balance sheet date. Held-to-maturity investments are carried at amortized cost, reflecting the ability and intent to hold the securities to maturity. Trading investments are securities acquired with the intent to sell in the near term and are carried at fair value with changes in fair value reported in earnings. All other fixed maturity securities are classified as available-for-sale and are carried at fair value with net unrealized gains or losses related to non-credit factors reported as a component of accumulated other comprehensive loss. As of September 30, 2021, all investments in fixed maturities were classified as available-for-sale. The difference between the original cost and maturity value of a fixed maturity security is amortized to earnings using the interest method.

The Company reviews its available-for-sale securities portfolio for impairment and determines if impairment is related to credit loss or non-credit loss. In making the assessment of whether a loss is from credit or other factors, management considers the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and adverse conditions related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of cash flows is less than the amortized cost

basis, a credit loss exists and an allowance is created, limited by the amount that the fair value is less than the amortized cost basis. Subsequent activity related to the credit loss component (e.g. write-offs, recoveries) is recognized as part of the allowance for credit losses on available-for-sale securities.

For the nine months ended September 30, 2021, no credit losses were recognized on available-for-sale securities.

Correction of immaterial errors

Subsequent to issuing the Condensed Consolidated Financial Statements as of June 30, 2021 and March 31, 2021, management identified immaterial errors related to accrued payroll and revenue recognized for our Engineering & Design (“E&D”) services contract. These errors resulted in the overstatement of net losses reported for the three and six months ended June 30, 2021 and the three months ended March 31, 2021.

In our accrual of payroll at June 30, 2021 and March 31, 2021, we incorrectly over accrued payroll costs due to a miscalculation of days to be accrued resulting in an overstatement of accrued payroll and selling, general and administrative expense.

Additionally, in our analysis of costs incurred for our E&D services contract and determination of revenue to be recognized, we identified errors for the three and six months ended June 30, 2021, and three months ended March 31, 2021 due to incorrect identification and classification of costs. These errors resulted in an overstatement of contract liabilities with an understatement of revenues in addition to an understatement of cost of sales and overstatement of research and development expense.

We previously revised revenue recognition for the three months ended March 31, 2021 resulting in a reduction of revenue and cost of sales of $0.2 million with increases to contract liabilities and research and development expense. This amount is included in the revisions summarized below.

Based on evaluation of the errors, management has concluded that the prior period errors were immaterial to the previously issued financial statements. As such, management has elected to correct the identified, immaterial errors in the prior periods. In doing so, balances in these Condensed Consolidated Financial Statements have been adjusted to reflect the correction in the proper periods. Future financial statements that include prior periods will be corrected, as needed, when issued.

The effects of correcting the immaterial errors in our previously filed Condensed Consolidated Financial Statements are as follows:

Condensed Consolidated Balance Sheets (amounts in thousands)

	As of June 30, 2021									As of March 31, 2021
	As Initially Reported			Adjustments			As Revised			As Initially Reported			Adjustments			As Revised
Total assets	$	101,838		$	—		$	101,838		$	92,229		$	—		$	92,229
Contract liabilities		1,944			(275	)		1,669			2,439			75			2,514
Accrued expenses and other current liabilities(1)		2,663			(271	)		2,392			997			(191	)		806
Total current liabilities		6,466			(546	)		5,920			4,019			(116	)		3,903
Accumulated deficit		(90,107	)		546			(89,561	)		(33,344	)		116			(33,228	)
Total shareholders’ deficit		(87,986	)		546			(87,440	)		(31,591	)		116			(31,475	)
Total liabilities, convertible preferred stock, and shareholders’ deficit	$	101,838		$	—		$	101,838		$	92,229		$	—		$	92,229

____________

(1) At June 30, 2021, accrued expenses and other payables and operating lease liabilities were combined and presented as accrued expenses and other current liabilities. Balances at March 31, 2021 have been conformed to the updated presentation.

Condensed Consolidated Statements of Operations and Comprehensive Loss (amounts in thousands, except per share amounts)

	Three Months Ended June 30, 2021									Six Months Ended June 30, 2021
	As Initially Reported			Adjustments			As Revised			As Initially Reported			Adjustments			As Revised
Revenue	$	687		$	158		$	845		$	1,086		$	275		$	1,361
Cost of sales		687			158			845			1,086			275		$	1,361
Gross profit		—			—			—			—			—			—

Selling, general and administrative		4,340			(80	)		4,260			6,683			(271	)		6,412
Research and development		2,823			(158	)		2,665			4,548			(275	)		4,273
Total operating expenses		7,163			(238	)		6,925			11,231			(546	)		10,685
Operating loss	$	(7,163	)	$	238		$	(6,925	)	$	(11,231	)	$	546		$	(10,685	)

Net loss	$	(56,571	)	$	238		$	(56,333	)	$	(60,935	)	$	546		$	(60,389	)
Total comprehensive loss	$	(56,573	)	$	238		$	(56,335	)	$	(60,949	)	$	546		$	(60,403	)

Loss per share – Basic	$	(10.72	)	$	0.04		$	(10.68	)	$	(12.03	)	$	0.11		$	(11.92	)
Loss per share – Diluted	$	(10.72	)	$	0.04		$	(10.68	)	$	(12.03	)	$	0.11		$	(11.92	)

	Three Months Ended March 31, 2021
	As Initially Reported			Adjustments			As Revised
Revenue	$	591		$	(75	)	$	516
Cost of sales		591			(75	)		516
Gross profit		—			—			—

Selling, general and administrative		2,343			(191	)		2,152
Research and development		1,533			75			1,608
Total operating expenses		3,876			(116	)		3,760
Operating loss	$	(3,876	)	$	116		$	(3,760	)

Net loss	$	(4,172	)	$	116		$	(4,056	)
Total comprehensive loss	$	(4,184	)	$	116		$	(4,068	)

Loss per share – Basic	$	(0.86	)	$	0.02		$	(0.84	)
Loss per share – Diluted	$	(0.86	)	$	0.02		$	(0.84	)

The adjustments summarized above and below reduced the increases to Accumulated Deficit and Total Shareholders’ Deficit presented in the Condensed Consolidated Statements of Convertible Preferred Stock and Shareholders’ Deficit for the three months ended June 30, 2021 and March 31, 2021 by $0.2 million and $0.1 million, respectively.

Condensed Consolidated Statements of Cash Flows (amounts in thousands)

	Six Months Ended June 30, 2021									Three Months Ended March 31, 2021
	As Initially Reported			Adjustments			As Revised			As Initially Reported			Adjustments			As Revised
Net loss	$	(60,935	)	$	546		$	(60,389	)	$	(4,172	)	$	116		$	(4,056	)
Changes in asset and liabilities:
Accrued expenses and other current liabilities(1)		1,384			(271	)		1,113			418			(191	)		227
Contract liabilities		1,944			(275	)		1,669			2,439			75			2,514
Net cash used in operating activities	$	(8,502	)	$	—		$	(8,502	)	$	(625	)	$	—		$	(625	)

____________

(1) At June 30, 2021, accrued expenses and other payables and operating lease liabilities were combined and presented as accrued expenses and other current liabilities. Balances at March 31, 2021 have been conformed to the updated presentation.

Accounting Policies, by Policy (Policies) [Line Items]

Emerging Growth Company Status

The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended, (the “Securities Act”), as modified by the Jumpstart our Business Startups Act of 2012, (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

Emerging Growth Company Status

The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart our Business Startups Act of 2012, (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

Cash and Cash Equivalents

The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of December 31, 2020.

Cash and Cash Equivalents

The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of September 30, 2021 and December 31, 2020.

Net Income Per Common Share

Net Loss Per Common Share

Net loss per common share is computed by dividing net loss by the weighted average number of common stocks outstanding during the period, excluding common stocks subject to forfeiture by the Sponsor. Weighted average shares were reduced for the effect of an aggregate of 1,250,000 common stocks that are subject to forfeiture if the over-allotment option is not exercised by the underwriters (see Note 5). At December 31, 2020, the Company did not have any dilutive securities and other contracts that could, potentially, be exercised or converted into common stocks and then share in the earnings of the Company. As a result, diluted loss per share is the same as basic loss per share for the period presented.

Net Loss Per Common Share

Net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. The Company has two classes of shares, Class A Common Stock and Class B Common Stock. Earnings and losses are shared pro rata between the two classes of shares.

The Company’s statement of operations includes a presentation of net loss per share for Class A and Class B common Stock. Net loss per share for Class A and Class B common stock, basic and diluted, is calculated by dividing the proportionate share of net loss by the weighted average number of shares outstanding for the period.

Accounting standards

Recent Accounting Pronouncements

Management does not believe that any recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements.

Recent Accounting Pronouncements

In August 2020, the FASB issued ASU 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”), which simplifies accounting for convertible instruments by removing major separation models required under current GAAP. The ASU also removes certain settlement conditions that are required for equity-linked contracts to qualify for scope exception, and it simplifies the

diluted earnings per share calculation in certain areas. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company is currently assessing the impact, if any, that ASU 2020-06 would have on its financial position, results of operations or cash flows.

Management does not believe that any recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements.

Marketable Securities Held in Trust Account

At September 30, 2021, substantially all of the assets held in the Trust Account were held in money market funds which invest in U.S. Treasury securities.

Offering Costs Associated with the Initial Public Offering

The Company complies with the requirements of the ASC 340-10-S99-1. Offering costs consisted of legal, accounting, underwriting fees and other costs incurred through the Initial Public Offering that were directly related to the Initial Public Offering. Offering costs are allocated to the separable financial instruments issued in the Initial Public Offering based on a relative fair value basis, compared to total proceeds received. Offering costs associated with warrant liabilities are expensed as incurred, presented as non-operating expenses in the statement of operations. Offering costs associated with the Class A common stock were charged to stockholders’ equity upon the completion of the Initial Public Offering. Transaction costs amounted to $14,203,291, of which $566,948 were allocated to expense associated with the warrant liability.

Reconciliation of Net Income per Common Share

Reconciliation of Net Loss per Common Share

The Company’s net loss is adjusted for the portion of net loss that is allocable to each class of common stock. The allocable net loss is calculated by multiplying net loss by the ratio of weighted average number of shares outstanding attributable to Class A and Class B common stock to the total weighted average number of shares outstanding for the period. Accordingly, basic and diluted loss per common share is calculated as follows:

	Three Months Ended September 30, 2021			Nine Months Ended September 30, 2021
Class A Common Stock
Numerator: Net loss allocable to Class A common stock
Net loss	$	(5,763,793	)	$	(5,511,905	)
Less: Allocation of net loss to Class B common stock		(1,440,948	)		(1,753,788	)
Proportionate share of net loss	$	(4,322,845	)	$	(3,758,117	)
Denominator: Weighted Average Class A Common Stock
Basic and diluted weighted average shares outstanding		25,700,000			18,357,143
Basic and diluted net loss per share	$	(0.17	)	$	(0.20	)

Class B Common Stock
Numerator: Net loss allocable to Class B common stock
Net loss	$	(5,763,793	)	$	(5,511,905	)
Less: Allocation of net loss to Class A common stock		(4,322,845	)		(3,758,117	)
Proportionate share of net loss	$	(1,440,948	)	$	(1,753,788	)
Weighted average shares outstanding, basic and diluted		8,566,667			8,566,667
Basic and diluted net loss per common share	$	(0.17	)	$	(0.20	)

Fair Value of Financial Instruments

The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying balance sheet, primarily due to their short-term nature.