Corner Growth Acquisition (COOL) - 2022 Q2 - Quarterly Report

PART I—FINANCIAL INFORMATION Item 1. Financial Statements The company's pre-business combination financial statements show a balance sheet dominated by trust account assets and a net income driven by non-cash warrant liability changes Condensed Balance Sheets As of June 30, 2022, the company held $400.8 million in its Trust Account, with a significant decrease in warrant liabilities improving the shareholders' deficit Condensed Balance Sheet Data (Unaudited) | Balance Sheet Items | June 30, 2022 | December 31, 2021 | | :--- | :--- | :--- | | Assets | | | | Cash | $169,812 | $646,558 | | Cash and marketable securities held in Trust Account | $400,769,393 | $400,142,570 | | Total Assets | $401,112,717 | $401,148,599 | | Liabilities & Shareholders' Deficit | | | | Warrant liabilities | $1,059,227 | $14,520,000 | | Deferred underwriting fee payable | $14,000,000 | $14,000,000 | | Total Liabilities | $15,531,233 | $28,715,343 | | Total Shareholders' Deficit | $(15,187,909) | $(27,566,744) | Unaudited Condensed Statements of Operations Net income for H1 2022 was $13.1 million, primarily driven by a $13.5 million non-cash gain from the change in fair value of warrant liabilities Statement of Operations Highlights (Unaudited) | Item | Six Months Ended June 30, 2022 | Six Months Ended June 30, 2021 | | :--- | :--- | :--- | | Operating and formation costs | $(939,368) | $(893,188) | | Change in fair value of warrant liabilities | $13,460,773 | $(3,634,667) | | Net income (loss) | $13,148,228 | $(4,444,339) | | Basic and diluted net income (loss) per share | $0.26 | $(0.09) | Unaudited Condensed Statements of Cash Flows Net cash used in operating activities was $406,746 for the six months ended June 30, 2022, resulting in a decreased period-end cash balance Cash Flow Summary (Unaudited) | Cash Flow Activity | Six Months Ended June 30, 2022 | Six Months Ended June 30, 2021 | | :--- | :--- | :--- | | Net cash used in operating activities | $(406,746) | $(621,352) | | Net cash used in financing activities | $(70,000) | $(37,554) | | Net change in cash | $(476,746) | $(658,906) | | Cash at end of the period | $169,812 | $1,258,029 | Notes to Unaudited Condensed Financial Statements Notes detail the company's SPAC status, accounting policies for warrants and redeemable shares, and substantial doubt about its ability to continue as a going concern - The company was incorporated to effect a business combination and intends to focus on the technology industry, with no operating revenue until a business combination is complete[20][21][22] - Management has determined that the mandatory liquidation date of December 21, 2022, raises substantial doubt about the company's ability to continue as a going concern[37][112] - Warrant liabilities, measured at fair value, decreased from $14,520,000 to $1,059,227 in the first half of 2022[93][98] - The company has a commitment to pay a deferred underwriting fee of $14,000,000 from the Trust Account upon completion of a Business Combination[75] Management's Discussion and Analysis of Financial Condition and Results of Operations The company is a blank check entity facing a December 2022 liquidation deadline with substantial doubt about its going concern status and insufficient working capital - The company is a blank check company formed to effect a business combination, with a focus on the technology industry in the United States and other developed countries[102] - The company has until December 21, 2022, to complete a Business Combination or it will be required to liquidate[107] - Management believes the company will not have sufficient working capital and has determined the mandatory liquidation date raises substantial doubt about its ability to continue as a going concern[111][112] Results of Operations Summary | Period | Net Income / (Loss) | Key Drivers | | :--- | :--- | :--- | | Six Months Ended June 30, 2022 | $13,148,228 | $13.5M gain on warrant liabilities, $0.6M earnings on trust account, offset by $0.9M operating costs | | Six Months Ended June 30, 2021 | $(4,444,339) | $3.6M loss on warrant liabilities and $0.9M operating costs, offset by $0.1M earnings on trust account | Quantitative and Qualitative Disclosures About Market Risk As a smaller reporting company, the company is not required to provide quantitative and qualitative disclosures about market risk - As a smaller reporting company, the company is not required to provide quantitative and qualitative disclosures about market risk[131] Disclosure Controls and Procedures Management concluded that disclosure controls and procedures were not effective as of June 30, 2022, due to a material weakness in internal control - Management evaluated the effectiveness of disclosure controls and procedures and concluded they were not effective as of June 30, 2022[133] - The ineffectiveness is due to a material weakness in internal control over financial reporting related to accounting for complex financial instruments[133] PART II – OTHER INFORMATION Legal Proceedings The company reports no current legal proceedings - There are no legal proceedings to report[138] Risk Factors A new risk factor has been added concerning a potential CFIUS review of a business combination due to the sponsor's funding sources - A new risk factor has been added regarding potential review of a Business Combination by the Committee on Foreign Investment in the United States (CFIUS)[140][141] - The risk arises because non-U.S. persons made the majority of capital contributions to the sponsor, which could lead to a CFIUS review that may delay or prohibit a transaction[143][144] Unregistered Sales of Equity Securities and Use of Proceeds The company reports no unregistered sales of equity securities or use of proceeds during the period - None[145] Other Information The company reports no other material information for the period - None[148] Exhibits Filed exhibits include required CEO and CFO certifications and Inline XBRL documents - Exhibits filed include CEO and CFO certifications pursuant to Sarbanes-Oxley Sections 302 and 906, and various Inline XBRL files[150]