Global Business Travel (GBTG) - 2021 Q3 - Quarterly Report

PART I. FINANCIAL INFORMATION This section presents the interim financial statements, management's discussion and analysis, market risk disclosures, and controls and procedures Item 1. Interim Condensed Financial Statements This section presents the unaudited interim condensed financial statements, including the balance sheets, statements of operations, changes in shareholders' equity (deficit), and cash flows, along with comprehensive notes detailing the company's organization, accounting policies, public offering, related party transactions, commitments, and fair value measurements Condensed Balance Sheets This section presents the company's financial position, including assets, liabilities, and shareholders' deficit, as of specific dates Condensed Balance Sheet Highlights | Metric | September 30, 2021 (unaudited) | December 31, 2020 | | :--------------------------------- | :----------------------------- | :------------------ | | Total current assets | $1,529,072 | $1,383,127 | | Investments held in Trust Account | $817,227,602 | $816,985,533 | | Total assets | $818,756,674 | $818,368,660 | | Total current liabilities | $12,368,009 | $2,256,681 | | Derivative warrant liabilities | $32,170,529 | $74,642,310 | | Total liabilities | $73,126,888 | $105,487,341 | | Class A ordinary shares subject to possible redemption | $816,810,000 | $816,810,000 | | Total shareholders' deficit | $(71,180,214) | $(103,928,681) | Condensed Statements of Operations This section details the company's financial performance, including expenses, investment income, and net income (loss), for specific periods Condensed Statements of Operations Highlights | Metric | Three Months Ended Sep 30, 2021 | Three Months Ended Sep 30, 2020 | Nine Months Ended Sep 30, 2021 | Nine Months Ended Sep 30, 2020 | | :-------------------------------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Revenue | $— | $— | $— | $— | | Total Expenses | $4,004,133 | $10,000 | $9,962,402 | $11,854 | | Investment income from Trust Account | $65,883 | $— | $242,069 | $— | | Change in fair value of derivative warrant liabilities | $15,086,661 | $— | $42,471,781 | $— | | Net income (loss) | $11,146,873 | $(10,000) | $32,748,467 | $(11,854) | | Basic and diluted net income per Class A ordinary share | $0.11 | $— | $0.32 | $— | Condensed Statements of Changes in Shareholders' Equity (Deficit) This section outlines the changes in the company's shareholders' equity or deficit over various reporting periods Changes in Shareholders' Deficit (Nine Months Ended Sep 30, 2021) | Metric | December 31, 2020 | March 31, 2021 | June 30, 2021 | September 30, 2021 | | :---------------------- | :---------------- | :------------- | :------------ | :----------------- | | Accumulated Deficit | $(103,929,702) | $(83,646,556) | $(82,328,108) | $(71,181,235) | | Total Shareholders' Deficit | $(103,928,681) | $(83,645,535) | $(82,327,087) | $(71,180,214) | Changes in Shareholders' Equity (Deficit) (Nine Months Ended Sep 30, 2020) | Metric | December 31, 2019 | March 31, 2020 | June 30, 2020 | September 30, 2020 | | :---------------------- | :---------------- | :------------- | :------------ | :----------------- | | Accumulated Deficit | $(30,048) | $(31,902) | $(31,902) | $(41,902) | | Total Shareholders' Equity (Deficit) | $1,854 | $— | $— | $(10,000) | Condensed Statements of Cash Flows This section summarizes the company's cash inflows and outflows from operating, investing, and financing activities for specific periods Condensed Statements of Cash Flows Highlights (Nine Months Ended Sep 30) | Metric | 2021 | 2020 | | :----------------------------------- | :------------- | :--- | | Net income (loss) | $32,748,467 | $(11,854) | | Net Cash Used In Operating Activities | $(3,314,588) | $— | | Net Cash Provided By Financing Activities | $3,928,233 | $— | | Net change in cash | $613,645 | $— | | Cash at end of period | $871,517 | $— | Notes to Unaudited Condensed Financial Statements This section provides detailed explanatory notes to the unaudited condensed financial statements, covering significant accounting policies and specific financial items NOTE 1 — DESCRIPTION OF ORGANIZATION, BUSINESS OPERATIONS AND GOING CONCERN Apollo Strategic Growth Capital is a SPAC formed to effect a business combination, has not commenced operations, generates non-operating income from its Trust Account, and faces going concern considerations due to insufficient liquidity outside the Trust Account - The Company was incorporated on October 10, 2008, and formally changed its name to Apollo Strategic Growth Capital on August 6, 2020, operating as an 'emerging growth company'[18] - As of September 30, 2021, the Company had not commenced any operations and will not generate operating revenues until after its Initial Business Combination, with non-operating income derived from interest on cash and cash equivalents from the Public Offering proceeds[19] - The Public Offering on October 6, 2020, generated $750,000,000, with an additional $66,810,000 from the overallotment option on November 10, 2020, totaling $816,810,000 placed in a Trust Account[20][21] - The Company has a working capital deficit of approximately $10.8 million and current liabilities of $12.4 million as of September 30, 2021, raising substantial doubt about its ability to continue as a going concern if an Initial Business Combination is not consummated[31][32] NOTE 2 — REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS The Company revised its previously issued financial statements to reclassify all redeemable Class A ordinary shares as temporary equity, following SEC guidance, which also impacted the earnings per share calculation - In September 2021, the SEC communicated that all public shares should be reclassified as temporary equity, leading the Company to change its accounting practice[38][39] - The reclassification resulted in adjustments to temporary equity, Class A ordinary shares, additional paid-in capital, and accumulated deficit as of December 31, 2020[41] Impact of Reclassification on December 31, 2020 Balance Sheet | Metric | As previously reported | Adjustments | As revised | | :-------------------------- | :--------------------- | :---------- | :--------- | | Temporary equity | $707,881,310 | $108,928,690 | $816,810,000 | | Class A ordinary shares | $545 | $(545) | $— | | Additional paid in capital | $24,670,251 | $(24,670,251) | $— | | Accumulated deficit | $(19,671,808) | $(84,257,894) | $(103,929,702) | | Total shareholders' deficit | $5,000,009 | $(108,928,690) | $(103,928,681) | NOTE 3 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES This note outlines the Company's significant accounting policies, including its basis of presentation as an emerging growth company, use of estimates, concentration of credit risk, treatment of offering costs, classification of redeemable Class A ordinary shares, income tax considerations, net income (loss) per ordinary share calculation, and accounting for derivative financial instruments and warrants - The Company is an 'emerging growth company' and has elected not to opt out of the extended transition period for complying with new or revised financial accounting standards[43][45] - Class A ordinary shares subject to possible redemption are classified as temporary equity, and changes in redemption value are recognized immediately, adjusting the carrying value to equal the redemption value at each reporting period[50][51] - The Company accounts for warrants as derivative instruments, recorded at fair value at issuance and re-valued at each reporting date, with changes in fair value reported in the condensed statements of operations[59][60] - The Company adopted ASU 2020-06 on January 1, 2021, which simplifies accounting for convertible instruments and equity-linked contracts, but it did not impact the Company's financial position, results of operations, or cash flows[62] NOTE 4 — INITIAL PUBLIC OFFERING The Company completed its Public Offering, selling 81,681,000 Units at $10.00 per Unit, including the over-allotment option, generating gross proceeds of $816,810,000, with each Unit consisting of one Class A ordinary share and one-third of one redeemable Public Warrant - The Public Offering involved the sale of 81,681,000 Units at $10.00 per Unit, including the over-allotment, generating $816,810,000 in gross proceeds[64] - Each Unit comprises one Class A ordinary share and one-third of one redeemable Public Warrant, with each whole Public Warrant allowing the purchase of one Class A ordinary share at $11.50[64] NOTE 5 — PRIVATE PLACEMENT Simultaneously with the Public Offering, the Sponsor purchased 12,224,134 Private Placement Warrants at $1.50 each, generating $18,336,200, with these proceeds added to the Trust Account and the warrants subject to transfer restrictions - The Company sold 12,224,134 Private Placement Warrants to the Sponsor at $1.50 per warrant, totaling $18,336,200 in gross proceeds[65] - Proceeds from the Private Placement Warrants were added to the Trust Account, and these warrants will be worthless if the Company fails to complete an Initial Business Combination within the Completion Window[66] - The Sponsor and the Company's officers and directors are subject to transfer restrictions on their Private Placement Warrants until 30 days after the completion of the Initial Business Combination[67] NOTE 6 — RELATED PARTIES This note details transactions with related parties, including the issuance and forfeiture of Founder Shares, multiple unsecured promissory notes from the Sponsor totaling $5,800,000, advances from related parties for expenses, and a monthly administrative service fee paid to the Sponsor - The Sponsor held 20,420,250 Class B ordinary shares (Founder Shares) as of September 30, 2021, after forfeitures and recapitalization[70] - The Sponsor provided several unsecured promissory notes to the Company, totaling $5,800,000 as of September 30, 2021, to cover expenses[74][75][76][79] - The Company pays the Sponsor a monthly administrative fee of $16,667 for office space, utilities, and administrative support, incurring $150,649 for the nine months ended September 30, 2021[81] - Advances from related parties for formation, operating, and offering costs amounted to $4,222 due as of September 30, 2021, down from $373,517 at December 31, 2020[80] NOTE 7 — COMMITMENTS AND CONTINGENCIES The Company acknowledges potential negative impacts from the COVID-19 pandemic, details registration rights for holders of Founder Shares and Private Placement Warrants, and outlines a deferred underwriting commission of $28,588,350 contingent upon the completion of an Initial Business Combination - Management is evaluating the impact of the COVID-19 pandemic, noting it could negatively affect the Company's financial position and search for a target company, though the specific impact is not yet determinable[82] - Holders of Founder Shares, Private Placement Warrants, and any warrants from working capital loans are entitled to registration rights[83] - A deferred underwriting commission of $28,588,350 is payable to the underwriters upon completion of an Initial Business Combination[85] NOTE 8 — SHAREHOLDERS' EQUITY The Company is authorized to issue preferred shares (none outstanding) and ordinary shares, including 300,000,000 Class A and 60,000,000 Class B shares, with 81,681,000 Class A shares subject to possible redemption and 20,420,250 Class B shares outstanding as of September 30, 2021 - The Company is authorized to issue 1,000,000 preferred shares, but none were issued or outstanding as of September 30, 2021, and December 31, 2020[86] - Authorized ordinary shares include 300,000,000 Class A and 60,000,000 Class B shares, with 81,681,000 Class A ordinary shares subject to possible redemption and classified as temporary equity as of September 30, 2021[87] - Class B ordinary shares (20,420,250 outstanding) automatically convert into Class A ordinary shares on a one-for-one basis upon completion of an Initial Business Combination, subject to certain adjustments[88] NOTE 9 — WARRANTS The Company has 39,451,134 warrants outstanding (Public and Private Placement Warrants), which are accounted for as derivative liabilities at fair value, with changes recognized in the statement of operations - As of September 30, 2021, there were 39,451,134 warrants outstanding, comprising 12,224,134 Private Placement Warrants and 27,227,000 Public Warrants[90] - Public Warrants become exercisable on the later of 30 days after an Initial Business Combination or 12 months from the Public Offering closing, provided an effective registration statement is in effect[90] - Private Placement Warrants are non-transferable and non-redeemable as long as held by initial purchasers or permitted transferees, differing from Public Warrants[91] - All warrants are accounted for as derivative liabilities at fair value, with changes in fair value recognized in the condensed statements of operations[95][96] NOTE 10 — FAIR VALUE MEASUREMENTS The Company measures financial assets and liabilities at fair value using a three-tier hierarchy, with marketable securities and Public Warrants as Level 1, and Private Placement Warrants as Level 3, resulting in a significant gain from the decrease in derivative warrant liability - The Company uses a three-tier fair value hierarchy: Level 1 for quoted prices in active markets, Level 2 for observable inputs other than quoted prices, and Level 3 for unobservable inputs[61][68] - Marketable securities held in the Trust Account are classified as Level 1, Public Warrants are classified as Level 1, while Private Placement Warrants are classified as Level 3 due to the use of unobservable inputs in their valuation[99][101] Fair Value Measurements of Assets and Liabilities | Description | Level | September 30, 2021 | December 31, 2020 | | :---------------------------------- | :---- | :----------------- | :---------------- | | Marketable securities held in Trust Account | 1 | $817,227,602 | $816,985,533 | | Warrant Liability – Private Placement Warrants | 3 | $9,980,524 | $23,455,550 | | Warrant Liability – Public Warrants | 1 | $22,190,005 | $51,186,760 | - The derivative warrant liability decreased from $74,642,310 at December 31, 2020, to $32,170,529 at September 30, 2021, resulting in a gain of $42,471,781 for the nine months ended September 30, 2021[102] NOTE 11 — SUBSEQUENT EVENTS The Company reviewed subsequent events through the financial statement issuance date and identified no events requiring recognition or disclosure - The Company did not identify any subsequent events that would require recognition or disclosure in the condensed financial statements[103] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides management's perspective on the Company's financial condition and operational results, highlighting its status as a blank check company, the absence of operating revenues, and the reliance on non-operating income Overview The Company is a blank check company formed to execute an Initial Business Combination, primarily using proceeds from its Public Offering and Private Placement, with potential future equity or debt issuances leading to dilution or increased indebtedness - The Company is a blank check company formed to effect a merger, share exchange, asset acquisition, share purchase, reorganization, or similar business combination[107] - The Initial Business Combination will be financed using cash from the Public Offering and Private Placement, capital stock, debt, or a combination thereof[107] - Issuance of additional ordinary shares for an Initial Business Combination may significantly dilute existing investors' equity interest and could cause a change in control[108] - Incurring significant indebtedness could lead to default, acceleration of obligations, inability to obtain additional financing, and limitations on flexibility[111] Results of Operations The Company has not generated operating revenues, with activities focused on its formation, Public Offering, and search for a target company, reporting net income for 2021 periods primarily driven by a gain in the fair value of derivative warrant liabilities - The Company has not engaged in any operations nor generated any revenues to date, with activities focused on organizational tasks, the Public Offering, and identifying a target company[110] - Non-operating income is generated from interest income on marketable securities held in the Trust Account[110] Net Income (Loss) Summary | Period | Net Income (Loss) | | :------------------------------ | :---------------- | | Three months ended Sep 30, 2021 | $11,146,873 | | Nine months ended Sep 30, 2021 | $32,748,467 | | Three months ended Sep 30, 2020 | $(10,000) | | Nine months ended Sep 30, 2020 | $(11,854) | - The net income for 2021 periods was primarily driven by a significant gain in the fair value of derivative warrant liabilities ($15,086,661 for three months, $42,471,781 for nine months)[112][113] Liquidity and Capital Resources The Company's liquidity is primarily derived from the $816,810,000 held in the Trust Account, invested in U.S. government securities, with $871,517 cash outside the Trust Account for operational expenses, and $5,800,000 in Sponsor promissory notes covering working capital needs - The Public Offering and over-allotment generated $816,810,000, which was placed in the Trust Account, including $28,588,350 of underwriters' deferred discount[115][116] - As of September 30, 2021, the Company had $817,227,602 in U.S. treasury securities held in the Trust Account and $871,517 in cash outside the Trust Account[119][120] - The Sponsor has provided $5,800,000 through a series of promissory notes to satisfy working capital requirements[117] - The Company may need to obtain additional financing to complete an Initial Business Combination or if a significant number of public shares are redeemed[123] Off-Balance Sheet Arrangements As of September 30, 2021, the Company had no off-balance sheet arrangements - The Company did not have any off-balance sheet arrangements as of September 30, 2021[124] Contractual Obligations The Company's primary contractual obligations include a monthly administrative fee of $16,667 to an affiliate of the Sponsor and a deferred underwriting fee of $28,588,350, contingent upon the completion of an Initial Business Combination - The Company has an agreement to pay an affiliate of the Sponsor a monthly fee of $16,667 for office space, utilities, secretarial support, and administrative services for up to 27 months[125] - Underwriters are entitled to a deferred fee of $28,588,350, which will be waived if the Company does not complete an Initial Business Combination[126] Critical Accounting Policies Key accounting policies involve the use of estimates, accounting for Class A ordinary shares subject to possible redemption, net income (loss) per ordinary share, and the fair value of assets and liabilities - Critical accounting policies include the use of estimates, Class A ordinary shares subject to possible redemption, net income (loss) per ordinary share, and the fair value of assets and liabilities[127] Recent Accounting Pronouncements Relevant recent accounting pronouncements are detailed in Note 3 to the condensed financial statements - A list of recent accounting pronouncements relevant to the Company is included in Note 3 to the condensed financial statements[129] Item 3. Quantitative and Qualitative Disclosures Regarding Market Risk As of September 30, 2021, the Company was not subject to any material market or interest rate risk, as proceeds from the Public Offering held in the Trust Account are invested in short-term U.S. government securities or money market funds - As of September 30, 2021, the Company was not subject to any material market or interest rate risk[130] - Net proceeds in the Trust Account are invested in short-term U.S. government treasury bills, notes, or bonds (185 days or less maturity) or money market funds, resulting in no material exposure to interest rate risk[130] Item 4. Controls and Procedures The Company's disclosure controls and procedures were evaluated as effective as of September 30, 2021, following the remediation of a material weakness related to the accounting and disclosure of complex debt and equity instruments - The Company's disclosure controls and procedures were evaluated as effective as of September 30, 2021[131] - A material weakness related to the accounting and disclosure of complex debt and equity instruments, which led to a restatement, has been fully remediated[131][133] - Remediation steps included expanding and improving the review process for complex securities, enhancing access to accounting literature, identifying third-party professionals for consultation, and considering additional experienced staff[133] PART II. OTHER INFORMATION This section covers legal proceedings, risk factors, equity sales, defaults, mine safety disclosures, other information, and a list of exhibits Item 1. Legal Proceedings The Company reported no legal proceedings - There are no legal proceedings[136] Item 1A. Risk Factors The Company refers to the risk factors disclosed in its Annual Report on Form 10-K/A, stating that there have been no material changes to these factors as of the date of this Quarterly Report - The Company refers to the risk factors described in its Annual Report, and as of the date of this Quarterly Report, there have been no material changes to these factors[137] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds The Company did not have any unregistered sales of equity securities during the quarter ended September 30, 2021, detailing the use of $816,810,000 gross proceeds from its Public Offering, with $800,473,800 placed in the Trust Account - The Company did not sell any equity securities during the quarter ended September 30, 2021[138] - The Public Offering and partial exercise of the over-allotment option generated total gross proceeds of $816,810,000[139][141] - Of the gross proceeds, $800,473,800, including deferred underwriting discounts and commissions, was placed in the Trust Account[143] - The Company paid $16,336,200 in underwriting discounts and commissions and incurred an additional $28,588,350 in deferred underwriting commissions[140][142] Item 3. Defaults Upon Senior Securities The Company reported no defaults upon senior securities - There were no defaults upon senior securities[146] Item 4. Mine Safety Disclosures This item is not applicable to the Company - Mine Safety Disclosures are not applicable[147] Item 5. Other Information The Company reported no other information - There is no other information to report[148] Item 6. Exhibits This section lists all exhibits filed as part of, or incorporated by reference into, the Quarterly Report on Form 10-Q, including organizational documents, specimen certificates, promissory notes, and certifications - The exhibits include the Second Amended and Restated Memorandum and Articles of Association, specimen unit, share, and warrant certificates, a promissory note, and certifications from the Principal Executive and Financial Officers[150] PART III. SIGNATURES This section contains the official signatures of the company's executive and financial officers, certifying the report Signatures The report is signed by Sanjay Patel, Chief Executive Officer, and James Crossen, Chief Financial Officer and Secretary, on November 10, 2021 - The report was signed by Sanjay Patel, Chief Executive Officer, and James Crossen, Chief Financial Officer and Secretary, on November 10, 2021[155]