The accompanying notes are an integral part of
the unaudited condensed financial statements.
The accompanying notes are an integral part of
the unaudited condensed financial statements.
The accompanying notes are an integral part of
the unaudited condensed financial statements.
The accompanying notes are an integral part of
the unaudited condensed financial statements.
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2021
(Unaudited)
NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS
Vickers Vantage Corp. I (the “Company”)
is a blank check company incorporated as a Cayman Islands exempted company on February 21, 2020. 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 or entities (a “Business Combination”).
The Company is not limited to a particular industry
or sector for purposes of consummating a Business Combination. The Company is an early stage and emerging growth company and, as such,
the Company is subject to all of the risks associated with early stage and emerging growth companies.
As of June 30, 2021, the Company had not commenced
any operations. All activity for the period from February 21, 2020 (inception) through June 30, 2021 relates to the Company’s formation
and the initial public offering (“Initial Public Offering”), which is described below, and, subsequent to the Initial Public
Offering, identifying a target company for a Business Combination. The Company will not generate any operating revenues until after the
completion of a Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income from
the proceeds derived from the Initial Public Offering. The Company has selected December 31 as its fiscal year end.
The registration statement for the Company’s
Initial Public Offering was declared effective on January 6, 2021. On January 11, 2021 the Company consummated the Initial Public Offering
of 13,800,000 Units (the “Units” and, with respect to the ordinary shares included in the Units sold, the “Public
Shares”), which includes the full exercise by the underwriter of its over-allotment option in the amount of 1,800,000 Units,
at $10.00 per Unit, generating gross proceeds of $138,000,000 which is described in Note 3.
Simultaneously with the closing of the Initial
Public Offering, the Company consummated the sale of 6,840,000 warrants (the “Private Placement Warrants”) at a
price of $0.75 per Private Placement Warrant in a private placement to Vickers Venture Fund VI Pte Ltd and Vickers Venture Fund VI
(Plan) Pte Ltd, (the “Sponsor”), generating gross proceeds of $5,130,000, which is described in Note 4.
Transaction costs amounted to $8,149,473, consisting
of $2,400,000 in cash underwriting fees, $5,190,000 in deferred underwriting fees, and $559,473 of other offering costs
Following the closing of the Initial Public Offering
on January 11, 2021, an amount of $139,380,000 ($10.10 per Unit) from the net proceeds of the sale of the Units in the Initial
Public Offering and the sale of the Private Placement Warrants was placed in a trust account (the “Trust Account”), and invested
in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act, with a maturity of 185
days or less, or in any open-ended investment company that holds itself out as a money market fund investing solely in U.S. Treasuries
and meeting certain conditions under Rule 2a-7 of the Investment Company Act, as determined by the Company, until the earliest of: (i)
the completion of a Business Combination and (ii) the distribution of the funds in the Trust Account to the Company’s shareholders,
as described below.
The Company’s management has broad discretion
with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of the Private Placement Warrants,
although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. The
stock exchange listing rules require that the Business Combination must be with one or more operating businesses or assets with a fair
market value equal to at least 80% of the assets held in the Trust Account (as defined below) (less any deferred underwriting commissions
and taxes payable on the interest earned on the Trust Account). The Company will only complete a Business Combination if the post-Business
Combination company owns or acquires 50% or more of the issued and outstanding voting securities of the target or otherwise acquires a
controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment
Company Act of 1940, as amended (the “Investment Company Act”). There is no assurance that the Company will be able to successfully
effect a Business Combination.
The Company will provide the holders of the public
shares (the “Public Shareholders”) with the opportunity to redeem all or a portion of their public shares upon the completion
of the Business Combination, either (i) in connection with a general meeting called to approve the Business Combination or (ii) by means
of a tender offer. The decision as to whether the Company will seek shareholder approval of a Business Combination or conduct a tender
offer will be made by the Company, solely in its discretion. The Public Shareholders will be entitled to redeem their Public Shares, equal
to the aggregate amount then on deposit in the Trust Account, calculated as of two business days prior to the consummation of
the Business Combination (initially anticipated to be $10.10 per Public Share), including interest (which interest shall be net of
taxes payable), divided by the number of then issued and outstanding public shares, subject to certain limitations as described in the
prospectus. The per-share amount to be distributed to the Public Shareholders who properly redeem their shares will not be reduced by
the deferred underwriting commissions the Company will pay to the underwriters (as discussed in Note 7).
VICKERS VANTAGE CORP. I
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2021
(Unaudited)
The Company will proceed with a Business Combination
only if the Company has net tangible assets of at least $5,000,001 and, if the Company seeks shareholder approval, it receives an
ordinary resolution under Cayman Islands law approving a Business Combination, which requires the affirmative vote of a majority of the
shareholders who attend and vote at a general meeting of the Company. If a shareholder vote is not required and the Company does not decide
to hold a shareholder vote for business or other legal reasons, the Company will, pursuant to its Amended and Restated Memorandum and
Articles of Association, conduct the redemptions pursuant to the tender offer rules of the Securities and Exchange Commission (“SEC”),
and file tender offer documents containing substantially the same information as would be included in a proxy statement with the SEC prior
to completing a Business Combination. If the Company seeks shareholder approval in connection with a Business Combination, the Company’s
Sponsors have agreed to vote its Founder Shares (as defined in Note 5) and any Public Shares purchased during or after the Initial Public
Offering in favor of approving a Business Combination. Additionally, each Public Shareholder may elect to redeem their Public Shares,
without voting, and if they do vote, irrespective of whether they vote for or against a proposed Business Combination.
Notwithstanding the foregoing, if the Company
seeks shareholder approval of the Business Combination and the Company does not conduct redemptions pursuant to the tender offer rules,
a Public Shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert
or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)),
will be restricted from redeeming its shares with respect to more than an aggregate of 20% of the Public Shares without the Company’s
prior written consent.
The Sponsors have agreed (a) to waive their redemption
rights with respect to any Founder Shares and Public Shares held by them in connection with the completion of a Business Combination and
(b) not to propose an amendment to the Amended and Restated Memorandum and Articles of Association (i) to modify the substance or timing
of the Company’s obligation to allow redemption in connection with the Company’s initial Business Combination or to redeem 100%
of the Public Shares if the Company does not complete a Business Combination within the Combination Period (as defined below) or (ii)
with respect to any other provision relating to shareholders’ rights or pre-initial business combination activity, unless the Company
provides the Public Shareholders with the opportunity to redeem their Public Shares upon approval of any such amendment at a per-share
price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest (which interest shall be
net of taxes payable), divided by the number of then issued and outstanding Public Shares.
The Company will have until January 11, 2022 to
consummate a Business Combination. However, if the Company anticipates that it may not be able to consummate a Business Combination by
January 11, 2022, the Company may extend the period of time to consummate a Business Combination up to two times, each by an additional
three months (until July 11, 2022 to complete a Business Combination (the “Combination Period”). In order to extend the time
available for the Company to consummate a Business Combination, the Sponsor or its affiliate or designees must deposit into the Trust
Account $1,035,000 ($0.075 per Public Share), on or prior to the date of the applicable deadline, for each three month extension.
If the Company has not completed a Business Combination
within the Combination Period, the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably
possible but not more than ten business days thereafter, redeem 100% of the Public Shares, at a per-share price, payable in cash,
equal to the aggregate amount then on deposit in the Trust Account, including interest (less up to $50,000 of interest to pay dissolution
expenses and which interest shall be net of taxes payable), divided by the number of then issued and outstanding Public Shares, which
redemption will completely extinguish the rights of the Public Shareholders as shareholders (including the right to receive further liquidating
distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s
remaining Public Shareholders and its Board of Directors, liquidate and dissolve, subject in each case to the Company’s obligations
under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption
rights or liquidating distributions with respect to the Company’s warrants, which will expire worthless if the Company fails to
complete a Business Combination within the Combination Period.
The Sponsors have agreed to waive their rights
to liquidating distributions from the Trust Account with respect to the Founder Shares if the Company fails to complete a Business Combination
within the Combination Period. However, if the Sponsors or any of their respective affiliates acquire Public Shares, such Public Shares
will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination within the
Combination Period. The underwriters have agreed to waive their rights to their deferred underwriting commission (see Note 6) held in
the Trust Account in the event the Company does not complete a Business Combination within the Combination Period, and in such event,
such amounts will be included with the other funds held in the Trust Account that will be available to fund the redemption of the Public
Shares. In the event of such distribution, it is possible that the per share value of the assets remaining available for distribution
will be less than the amount of funds deposited into the Trust Account ($10.10 per share).
VICKERS VANTAGE CORP. I
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2021
(Unaudited)
In order to protect the amounts held in the Trust
Account, the Sponsors have agreed that it will be liable to the Company if and to the extent any claims by a third party (other than the
Company’s independent registered public accounting firm) for services rendered or products sold to the Company, or a prospective
target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account
to below (1) $10.10 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 interest which may be withdrawn to pay taxes,
except as to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account and except as
to any claims under the Company’s indemnity of the underwriters of the Initial Public Offering against certain liabilities, including
liabilities under the Securities Act of 1933, as amended (the “Securities Act”). In the event that an executed waiver is deemed
to be unenforceable against a third party, the Sponsors 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 Sponsors 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.
Going Concern and Liquidity
As of June 30, 2021, the Company had $257,621 in
its operating bank accounts, $139,406,212 in securities held in the Trust Account to be used for a Business Combination or to repurchase
or redeem its common stock in connection therewith and working capital of $471,955. As of June 30, 2021, approximately $26,000 of
the amount on deposit in the Trust Account represented interest income, which is available to pay the Company’s tax obligations.
If the Company is unable to raise additional capital,
it may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, suspending
the pursuit of a Business Combination. The Company cannot provide any assurance that new financing will be available to it on commercially
acceptable terms, if at all.
As a result of the above, 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,”
management has determined that the liquidity condition and date for mandatory liquidation and dissolution raise substantial doubt about
the Company’s ability to continue as a going concern through July 11, 2022 (extension date), the scheduled liquidation date of the
Company if it does not complete a Business Combination prior to such date. These consolidated financial statements do not include any
adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the
Company be unable to continue as a going concern.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited condensed financial
statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”)
for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the SEC. Certain
information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or
omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information
and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management,
the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are
necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented.
The accompanying unaudited condensed financial
statements should be read in conjunction with the Company’s prospectus for its Initial Public Offering as filed with the SEC on
January 7, 2021. The interim results for the three and six months ended June 30, 2021 are not necessarily indicative of the results to
be expected for the year ending December 31, 2021 or for any future periods.
Emerging Growth Company
The Company is an “emerging growth company,”
as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”),
and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that
are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting
firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation
in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive
compensation and shareholder approval of any golden parachute payments not previously approved.
VICKERS VANTAGE CORP. I
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2021
(Unaudited)
Further, Section 102(b)(1) of the JOBS Act exempts
emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that
is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered
under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company
can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but
any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that
when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging
growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison
of the Company’s financial statement with another public company which is neither an emerging growth company nor an emerging growth
company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting
standards used.
Use of Estimates
The preparation of the condensed financial statements
in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts
of revenues and expenses during the reporting period.
Making estimates requires management to exercise
significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances
that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near
term due to one or more future confirming events. One of the more significant accounting estimates included in these financial statements
is the determination of the fair value of the warrant liabilities. Such estimates may be subject to change as more current information
because available and accordingly, the actual results could differ significantly from those estimates.
Cash and Cash Equivalents
The Company considers all short-term investments
with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents
as of June 30, 2021 and December 31, 2020.
Offering Costs
Offering costs consist of legal, accounting, underwriting
fees and other costs incurred through the balance sheet date that are directly related to the Initial Public Offering. Offering costs
amounting to $8,119,261 were charged to shareholders’ equity upon the completion of the Initial Public Offering, and $30,212 of
the offering costs were related to the warrant liabilities and charged to the statement of operations.
Ordinary Shares Subject to Possible Redemption
The Company accounts for its ordinary shares subject
to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing
Liabilities from Equity.” Ordinary shares subject to mandatory redemption is classified as a liability instrument and is measured
at fair value. Conditionally redeemable ordinary shares (including ordinary shares that features redemption rights that is either within
the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control)
is classified as temporary equity. At all other times, ordinary shares are classified as shareholders’ equity. The Company’s
ordinary shares features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence
of uncertain future events. Accordingly, at June 30, 2021 and December 31, 2020, ordinary shares subject to possible redemption is presented
as temporary equity, outside of the shareholders’ equity section of the Company’s balance sheet.
Warrant Liability
The Company accounts for warrants as either equity-classified
or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance
in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing
Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment
considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant
to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants
are indexed to the Company’s own ordinary shares, among other conditions for equity classification. This assessment, which requires
the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while
the warrants are outstanding. We account for the warrants issued in connection with our Initial Public Offering in accordance with the
guidance contained in ASC 815 under which the public warrants meet the criteria for equity treatment and the private warrants do not meet
the criteria for equity treatment and must be recorded as liabilities. Accordingly, we classify the private warrants as liabilities at
their fair value and adjust the private warrants to fair value at each reporting period. This liability is subject to re-measurement at
each balance sheet date until exercised, and any change in fair value is recognized in our statement of operations. The fair value of
the warrants was estimated using a Black-Scholes option pricing formula.
VICKERS VANTAGE CORP. I
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2021
(Unaudited)
Income Taxes
The Company accounts for income taxes under ASC
Topic 740, “Income Taxes,” which prescribes a recognition threshold and a measurement attribute for the financial statement
recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax
position must be more likely than not to be sustained upon examination by taxing authorities. The Company’s management determined
that the Cayman Islands is the Company’s major tax jurisdiction. The Company recognizes accrued interest and penalties related to
unrecognized tax benefits as income tax expense. As of June 30, 2021 and December 31, 2020, there were no unrecognized tax benefits and
no amounts accrued for interest and penalties. The Company is currently not aware of any issues under review that could result in significant
payments, accruals or material deviation from its position.
The Company is considered to be an exempted Cayman
Islands company with no connection to any other taxable jurisdiction and is presently not subject to income taxes or income tax filing
requirements in the Cayman Islands or the United States. As such, the Company’s tax provision was zero for the period presented.
Net income (Loss) per Ordinary Share
Net income (loss) per share is computed
by dividing net income (loss) by the weighted average number of ordinary shares outstanding for the period. The calculation of diluted
income (loss) per share does not consider the effect of the warrants issued in connection with the (i) Initial Public Offering, (ii) the
exercise of the over-allotment option and (iii) Private Placement Warrants since the exercise of the warrants is contingent upon the occurrence
of future events and the inclusion of such warrants would be anti-dilutive.
The Company’s statements of operations
includes a presentation of income (loss) per share for ordinary shares subject to possible redemption in a manner similar to the two-class
method of income (loss) per share. Net income per ordinary share, basic and diluted, for redeemable ordinary shares is calculated by dividing
the interest income earned on the Trust Account, by the weighted average number of redeemable ordinary shares outstanding since original
issuance. Net loss per share, basic and diluted, for non-redeemable ordinary shares is calculated by dividing the net loss, adjusted for
income attributable to redeemable ordinary shares, by the weighted average number of non-redeemable ordinary shares outstanding for the
period. Non-redeemable ordinary shares includes the Founder Shares as these shares do not have any redemption features and do not participate
in the income earned on the Trust Account.
The following table reflects the calculation of
basic and diluted net income (loss) per ordinary share (in dollars, except per share amounts):
|
|
Three Months Ended
June 30,
|
|
|
Three
Months Ended
June 30,
|
|
|
Six
Months Ended
June 30,
|
|
|
For the Period From
February 21, 2020 (inception) through
June 30,
|
|
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
Redeemable Ordinary Shares
|
|
|
|
|
|
|
|
|
|
|
|
|
Numerator: Earnings allocable to Redeemable Ordinary Shares
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Income
|
|
$
|
6,791
|
|
|
$
|
—
|
|
|
$
|
26,212
|
|
|
$
|
—
|
|
Net Earnings
|
|
$
|
6,791
|
|
|
$
|
—
|
|
|
$
|
26,212
|
|
|
$
|
—
|
|
Denominator: Weighted Average Redeemable Ordinary Shares
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Redeemable Ordinary Shares, Basic and Diluted
|
|
|
13,800,000
|
|
|
|
1
|
|
|
|
13,800,000
|
|
|
|
1
|
|
Earnings/Basic and Diluted Redeemable Ordinary Shares
|
|
$
|
0.00
|
|
|
$
|
—
|
|
|
$
|
0.00
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Redeemable Ordinary Shares
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Numerator: Net Income minus Redeemable Net Earnings – Basic
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (loss)
|
|
$
|
(233,749
|
)
|
|
$
|
—
|
|
|
$
|
1,095,104
|
|
|
$
|
(5,000
|
)
|
Redeemable Net Earnings
|
|
|
(6,791
|
)
|
|
|
—
|
|
|
|
(26,212
|
)
|
|
|
—
|
|
Non-Redeemable Net Income – Basic
|
|
$
|
(240,540
|
)
|
|
$
|
—
|
|
|
$
|
1,068,892
|
|
|
$
|
(5,000
|
)
|
Denominator: Weighted Average Non-Redeemable Ordinary Shares
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Redeemable Ordinary Shares, Basic
|
|
|
3,450,000
|
|
|
|
1
|
|
|
|
3,425,000
|
|
|
|
1
|
|
Income (loss)/Basic Non-Redeemable Ordinary Shares
|
|
$
|
(0.07
|
)
|
|
$
|
—
|
|
|
$
|
0.31
|
|
|
$
|
(5,000
|
)
|
Note:
|
For the three and six months ended June 30, 2021, for the three month period ended June 30, 2020 and for the period from February 21, 2020 (inception) through June 30, 2020, basic and diluted shares are the same as there are no non-redeemable securities that are dilutive to the Company’s shareholders.
|
VICKERS VANTAGE CORP. I
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2021
(Unaudited)
Concentration of Credit Risk
Financial instruments that potentially subject
the Company to concentrations of credit risk consist of cash accounts in a financial institution, which, at times may exceed the Federal
Depository Insurance Corporation coverage limit of $250,000. The Company has not experienced losses on these accounts and management believes
the Company is not exposed to significant risks on such account.
Fair Value of Financial Instruments
The fair value of the Company’s assets and
liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurement,” approximates the carrying
amounts represented in the accompanying condensed balance sheets, primarily due to their short-term nature.
Recent Accounting Standards
Management does not believe that any other recently
issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s condensed
financial statements. In August 2020, the FASB issued Accounting Standards Update (“ASU”) No. 2020-06, Debt --debt with Conversion
and Other Options (Subtopic 470-20) and Derivatives and Hedging -- Contracts in Entity’ Own Equity (Subtopic 815-40): Accounting
for Convertible Instruments and Contracts in an Entity’ 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 the derivative scope exception, and it simplifies the diluted earnings per
share calculation in certain areas. Management is currently evaluating the new guidance, but does not expect the adoption of this guidance
to have a material impact on the Company’s financial statements.
NOTE 3. PUBLIC OFFERING
Pursuant to the Initial Public Offering, the Company
sold to 13,800,000 Units which includes a full exercise by the underwriters of their over-allotment option in the amount of 1,800,000 Units,
at a purchase price of $10.00 per Unit. Each Unit consists of one ordinary share and one-half of one redeemable warrant (“Public
Warrant”). Each whole Public Warrant entitles the holder to purchase one ordinary share at an exercise price of $11.50 per whole
share (see Note 8).
NOTE 4. PRIVATE PLACEMENT
Simultaneously with the closing of the Initial
Public Offering, the Sponsors purchased an aggregate of 6,840,000 Private Placement Warrants at a price of $0.75 per Private
Placement Warrant, for an aggregate purchase price of $5,130,000, in a private placement. Each Private Placement Warrant is exercisable
to purchase one ordinary share at a price of $11.50 per share, subject to adjustment (see Note 9). A portion of the proceeds from
the Private Placement Warrants were added to the proceeds from the Initial Public Offering held in the Trust Account. If the Company does
not complete a Business Combination within the Combination Period, the proceeds from the sale of the Private Placement Warrants will be
used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Placement Warrants will
expire worthless.
NOTE 5. RELATED PARTY TRANSACTIONS
Founder Shares
On July 16, 2020, the Company issued an aggregate
of 3,593,750 ordinary shares to an affiliate of the Sponsors for an aggregate purchase price of $25,000. In August 2020, the
affiliate transferred his Founder Shares to the Sponsors for the same price paid for such shares. On October 8. 2020, the Company effected
a share capitalization of 0.2 shares for each share outstanding, on December 7, 2020, the Sponsors forfeited 1,437,500 ordinary
shares, which were cancelled by the Company, and on January 6, 2021, the Company effected a share capitalization of 0.2 shares
for each share outstanding, resulting in 3,450,000 ordinary shares issued and outstanding (the “Founder Shares”).
All share and per-share amounts have been retroactively restated to reflect the share transactions. The Founder Shares included an aggregate
of up to 450,000 shares that were subject to forfeiture depending on the extent to which the underwriters’ over-allotment
option is exercised, so that the number of Founder Shares will equal, on an as-converted basis, approximately 20% of the Company’s
issued and outstanding ordinary shares after the Initial Public Offering. As a result of the underwriters’ election to partially
exercise their over-allotment option , no Founder Shares are currently subject to forfeiture.
The Sponsors have agreed, subject to limited exceptions,
not to transfer, assign or sell any of its Founder Shares until six months after the consummation of a Business Combination or earlier
if, subsequent to a Business Combination, the Company consummates a liquidation, merger, share exchange or other similar transaction that
results in all of the Public Shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property.
VICKERS VANTAGE CORP. I
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2021
(Unaudited)
Advances from Related Party
During 2020, an affiliate of the Sponsors advanced
the Company an aggregate of $30,000 to fund expenses in connection with the Initial Public Offering. The advances are non-interest
bearing and payable upon demand. As of June 30, 2021 and December 31, 2020, there was $0 and $30,000 advances outstanding, respectively.
The outstanding amount of $30,000 was repaid on February 26, 2021.
Promissory Note — Related Party
On July 16, 2020, the Company issued an unsecured
promissory note (the “Promissory Note”) to an affiliate of the Sponsors, pursuant to which the Company may borrow up to an
aggregate principal amount of $125,000. The Promissory Note is non-interest bearing and payable on the earlier of (i) December 31, 2020
or (ii) the completion of the Initial Public Offering. The outstanding balance under the Promissory Note of $125,000 was repaid subsequent
to the closing of the Initial Public Offering on January 14, 2021.
Related Party Loans
In order to finance transaction costs in connection
with a Business Combination, the Sponsors or an affiliate of the Sponsors, or certain of the Company’s officers and directors may,
but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). Such Working Capital Loans
would be evidenced by promissory notes. The notes may be repaid upon completion of a Business Combination, without interest, or,
at the lender’s discretion, up to $1,500,000 of notes may be converted upon completion of a Business Combination into warrants at
a price of $0.75 per warrant. Such warrants would be identical to the Private Placement Warrants. 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. As of June 30, 2021 and December 31, 2020, there were no amounts
outstanding under the Working Capital Loans.
Related Party Extension Loans
As discussed in Note 1, the Company may extend
the period of time to consummate a Business Combination up to two times, each by an additional three months (until July 11, 2022 to complete
a Business Combination). In order to extend the time available for the Company to consummate a Business Combination, the Sponsor
or its affiliates or designees must deposit into the Trust Account $1,035,000 ($0.075 per Public Share in either case), on or prior to
the date of the applicable deadline, for each three month extension, providing a total possible Business Combination period up until July
11, 2022 for a total payment value of $2,070,000 ($0.15 per unit in either case). Any such deposits would be made in the form of
non-interest bearing loans. Such notes would either be paid upon consummation of a Business Combination, or, at the relevant insider’s
discretion, converted upon consummation of a Business Combination into additional Private Placement Warrants at a price of $0.75 per
Private Placement Warrant. The Sponsor and its affiliates or designees intend, but are not obligated, to fund the Trust Account to extend
the time for the Company to complete a Business Combination.
NOTE 6. COMMITMENTS
Risks and Uncertainties
Management continues to evaluate the impact of
the COVID-19 pandemic and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s
financial position, results of its operations and/or search for a target company, the specific impact is not readily determinable as of
the date of these condensed financial statements. The condensed financial statements do not include any adjustments that might result
from the outcome of this uncertainty.
Registration Rights
Pursuant to a registration rights agreement entered
into on January 6, 2021, the holders of the Founder Shares, Private Placement Warrants and underlying ordinary shares and any securities
issued upon conversion of Working Capital Loans will be entitled to registration rights pursuant to a registration rights agreement requiring
the Company to register such securities for resale. The holders of these securities will be entitled to demand that the Company register
such securities at any time after the Company consummates a Business Combination. In addition, the holders have certain “piggy-back”
registration rights with respect to registration statements filed subsequent to the consummation of a Business Combination. 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 (i) 3.5% of the gross proceeds of the initial 12,000,000 Units sold in the Initial Public Offering, or $4,200,000, and (ii) 5.5%
of the gross proceeds from the Units sold pursuant to the over-allotment option, or $990,000. The deferred fee will be paid in cash
upon the closing of a Business Combination from the amounts held in the Trust Account, subject to the terms of the underwriting agreement.
VICKERS VANTAGE CORP. I
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2021
(Unaudited)
NOTE 7. SHAREHOLDERS’ EQUITY
Preference Shares — The
Company is authorized to issue 1,000,000 preference shares with a par value of $0.0001 per share, with such designations,
voting and other rights and preferences as may be determined from time to time by the Company’s board of directors. At June 30,
2021 and December 31, 2020, there were no preference shares issued or outstanding.
Ordinary Shares — The
Company is authorized to issue 200,000,000 ordinary shares, with a par value of $0.0001 per share. Holders of the ordinary
shares are entitled to one vote for each share. At June 30, 2021 and December 31, 2020, there were 4,777,637 and 3,450,000 ordinary
shares issued and outstanding, excluding 12,472,363 and zero ordinary shares subject to possible redemption, respectively.
NOTE 8. WARRANTS
Warrants — As of June
30, 2021 and December 31, 2020, there were 6,900,000 Public Warrants outstanding. Public Warrants may only be exercised for
a whole number of shares. No fractional shares will be issued upon exercise of the Public Warrants. The Public Warrants will become exercisable
on the later of (a) the completion of a Business Combination and (b) 12 months from the closing of the Initial Public Offering. The Public
Warrants will expire five years from the completion of a Business Combination or earlier upon redemption or liquidation.
No Public Warrants will be exercisable for cash
unless the Company has an effective and current registration statement covering the issuance of the ordinary shares issuable upon exercise
of the warrants and a current prospectus relating to such ordinary shares. Notwithstanding the foregoing, if a registration statement
covering the issuance of the ordinary shares issuable upon exercise of the Public Warrants is not effective within 90 days from the closing
of a Business Combination, warrant holders may, until such time as there is an effective registration statement and during any period
when the Company shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to
an available exemption from registration under the Securities Act. If an exemption from registration is not available, holders will not
be able to exercise their warrants on a cashless basis. The Public Warrants will expire five years after the completion of a Business
Combination or earlier upon redemption or liquidation.
The Company may redeem the Public Warrants:
|
●
|
in whole and not in part;
|
|
●
|
at a price of $0.01 per warrant;
|
|
●
|
at any time while the warrants become exercisable;
|
|
●
|
upon not less than 30 days’ prior written notice of redemption to each warrant holder;
|
|
●
|
if, and only if, the reported last sale price of the Company’s ordinary shares equals or exceeds $18.00 per share (subject to adjustment) for any 20 trading days within a 30-trading day period commencing after the warrants become exercisable and ending on the third trading business day prior to the notice of redemption to the warrant holders; and
|
|
●
|
if, and only if, there is a current registration statement in effect with respect to the issuance of the ordinary shares underlying such warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption.
|
If the Company calls the Public Warrants for redemption,
management will have the option to require all holders that wish to exercise the Public Warrants to do so on a “cashless basis,”
as described in the warrant agreement.
The exercise price and number of ordinary shares
issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary
dividend or recapitalization, reorganization, merger or consolidation. However, the warrants will not be adjusted for issuance of ordinary
shares at a price below its exercise price. The Company has agreed to use its best efforts to have declared effective a prospectus relating
to the ordinary shares issuable upon exercise of the warrants and keep such prospectus current until the expiration of the warrants. However,
if the Company does not maintain a current prospectus relating to the ordinary shares issuable upon exercise of the warrants, holders
will be unable to exercise their warrants for cash and the Company will not be required to net cash settle or cash settle the warrant
exercise. There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s warrants.
If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in
the Trust Account, holders of warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution
from the Company’s assets held outside of the Trust Account with the respect to such warrants. Accordingly, the warrants may expire
worthless.
VICKERS VANTAGE CORP. I
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2021
(Unaudited)
In addition, if (x) the Company issues additional
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 of directors and, in the case of any such issuance to the Sponsors or its affiliates, without
taking into account any Founder Shares held by the Sponsors or such affiliates, as applicable, prior to such issuance) (the “Newly
Issued Price”), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest
thereon, available for the funding of a Business Combination on the date of the consummation of a Business Combination (net of redemptions),
and (z) the volume weighted average trading price of its ordinary shares during the 20 trading day period starting on the trading day
prior to the day on which the Company consummates its Business Combination (such price, the “Market Value”) is below $9.20
per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value
and the Newly Issued Price, the $18.00 per share redemption trigger price will be adjusted (to the nearest cent) to be equal to 180% of
the higher of the Market Value and the Newly Issued Price.
At June 30, 2021 and December 31, 2020, there
were 6,840,000 Private Placement Warrants outstanding. The Private Placement Warrants are identical to the Public Warrants underlying
the Units sold in the Initial Public Offering, except that the Private Placement Warrants will be exercisable for cash (even if a registration
statement covering the issuance of the ordinary shares issuable upon exercise of such warrants is not effective) or on a cashless basis,
at the holder’s option and will not be redeemable by the Company, in each case so long as they are held by the initial purchasers
or their affiliates.
NOTE 9. FAIR VALUE MEASUREMENTS
The fair value of the Company’s financial
assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale
of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the
measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of
observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions
about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities
based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:
|
Level 1:
|
Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.
|
|
Level 2:
|
Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active.
|
|
Level 3:
|
Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability.
|
At June 30, 2021, assets held in the Trust Account
were comprised of $139,406,212 in money market funds which are invested primarily in U.S. Treasury Securities. Through June
30, 2021, the Company did not withdraw any of interest earned on the Trust Account.
The following table presents information about
the Company’s assets that are measured at fair value on a recurring basis at June 30, 2021 and indicates the fair value hierarchy
of the valuation inputs the Company utilized to determine such fair value:]
Description
|
|
Level
|
|
June 30,
2021
|
|
Assets:
|
|
|
|
|
|
Investments held in Trust Account – U.S. Treasury Securities Money Market Fund
|
|
1
|
|
$
|
139,406,212
|
|
|
|
|
|
|
|
|
The following table presents information about
the Company’s assets that are measured at fair value on a recurring basis at June 30, 2021 and indicates the fair value hierarchy
of the valuation inputs the Company utilized to determine such fair value:
Description
|
|
Level
|
|
June 30,
2021
|
|
Liabilities:
|
|
|
|
|
|
Warrant Liability – Private Placement Warrants
|
|
3
|
|
$
|
3,693,600
|
|
|
|
|
|
|
|
|
The Warrants were accounted for as liabilities
in accordance with ASC 815-40 and are presented within warrant liabilities on our accompanying June 30, 2021 condensed balance sheet.
The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within
change in fair value of warrant liabilities in the condensed statement of operations.
VICKERS VANTAGE CORP. I
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2021
(Unaudited)
Measurement
The Company established the initial fair value
for the private warrants on January 11, 2021, the date of the Company’s Initial Public Offering, using a Monte Carlo simulation
and subsequently implemented the Black-Scholes Option Pricing Model that was modified to capture the redemption features of the public
warrants. The underlying assumptions in the Black-Scholes option pricing model include the underlying share price, risk-free interest
rate, estimated volatility and the expected term. The primary unobservable inputs utilized in determining the fair value of the private
warrants are the expected volatility of the Company’s ordinary shares and the Company’s ordinary share price. The expected
volatility of the ordinary shares was determined based on implied volatilities of public warrants issued by selected guideline companies
and was estimated to be 10% before the expected business combination and 20% after the expected business combination. The ordinary share
price was determined based on an iterative procedure that matched the estimated value of the ordinary shares and fractional warrant price
to equate to the observed price of the outstanding units. The risk-free interest rate is based on the U.S. Treasury yield curve in effect
on the date of valuation equal to the remaining expected life of the private warrants. The dividend yield percentage is zero because the
Company does not currently pay dividends, nor does it intend to do so during the expected term of the warrants. The expected life of the
warrants is assumed to be equivalent to their remaining contractual term. Inputs are re-evaluated each quarterly reporting period to estimate
the fair market value of the private placement warrants as of the reporting period.
There were no transfers between Levels 1, 2 or
3 during the period ended June 30, 2021.
The following table provides quantitative information
regarding Level 3 fair value measurements:
|
|
As of
June 30,
2021
|
|
Stock price
|
|
$
|
9.92
|
|
Strike price
|
|
$
|
11.50
|
|
Term (in years)
|
|
|
5.24
|
|
Volatility
|
|
|
10.1
|
%
|
Risk-free rate
|
|
|
1.0
|
%
|
Dividend yield
|
|
|
0.0
|
%
|
Fair value of warrants
|
|
$
|
0.54
|
|
The following table presents the changes in the
fair value of warrant liabilities:
|
|
Private Placement
|
|
Fair value as of January 1, 2021
|
|
$
|
—
|
|
Initial measurement on January 11, 2021
|
|
|
7,729,200
|
|
Change in valuation inputs or other assumptions
|
|
|
(4,035,600
|
)
|
Fair value as of June 30, 2021
|
|
|
3,693,600
|
|
NOTE 10. SUBSEQUENT EVENTS
The Company evaluated subsequent events and transactions
that occurred after the balance sheet date up to the date that the condensed financial statements were issued. Based upon this review,
the Company did not identify any subsequent events that would have required adjustment or disclosure in the condensed financial statements.