10-Q

Large accelerated filer

Accelerated filer

Non-accelerated
filer

Smaller reporting company

Emerging growth company

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM

10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2021

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from

ESM Acquisition Corporation

(Exact name of registrant as specified in its charter)


Cayman Islands	001-40176	98-1576763
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(IRS Employer Identification No.)


2229 San Felipe, Suite 1300 Houston, TX		77019
(Address Of Principal Executive Offices)		(Zip Code)

(713)

579-5000

Registrant’s telephone number, including area code

Not Applicable

(Former name or former address, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Units, each consisting of one Class A ordinary share, $0.0001 par value, and one-third of one redeemable warrant	ESM.U	New York Stock Exchange
Class A ordinary shares included as part of the units	ESM	New York Stock Exchange
Redeemable warrants included as part of the units	ESM WS	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☐ No ☒

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation

S-T

(§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a

non-accelerated

filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule

12b-2

of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule

12b-2

of the Exchange Act). Yes ☒ No ☐

As of November

, 2021, 30,694,067 Class A ordinary shares, par value $0.0001 per share, and 7,673,516 Class B ordinary shares, par value $0.0001 per share, were issued and outstanding, respectively.

Table of Contents

ESM ACQUISITION CORPORATION

Quarterly Report on Form

10-Q

Table of Contents


		Page
PART I. FINANCIAL INFORMATION
Item 1.	Condensed Financial Statements (Unaudited)
	Unaudited Condensed Balance Sheet as of September 30, 2021		3
	Unaudited Condensed Statements of Operations for the three months ended September 30, 2021 and for the period from January 13, 2021 (inception) through September 30, 2021		4
	Unaudited Condensed Statements of Changes in Shareholders’ Deficit for the three months ended September 30, 2021 and for the period from January 13, 2021 (inception) through September 30, 2021		5
	Unaudited Condensed Statement of Cash Flows for the period from January 13, 2021 (inception) through September 30, 2021		6
	Notes to Unaudited Condensed Financial Statements		7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		23
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		27
Item 4.	Controls and Procedures		27

PART II. OTHER INFORMATION
Item 1.	Legal Proceedings		29
Item 1A.	Risk Factors		29
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds from Registered Securities		31
Item 3.	Defaults Upon Senior Securities		31
Item 4.	Mine Safety Disclosures		31
Item 5.	Other Information		32
Item 6.	Exhibits		32

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1.

Financial Statements (Unaudited)

ESM ACQUISITION CORPORATION

UNAUDITED CONDENSED BALANCE SHEET

September 30, 2021


Assets
Current assets:
Cash	$	1,302,827
Prepaid expenses		263,041

Total current assets		1,565,868
Investments held in Trust Account		306,985,306

Total Assets	$	308,551,174

Liabilities, Class A Ordinary Shares Subject to Possible Redemption and Shareholders’ Deficit:
Current liabilities:
Accounts payable	$	40,369
Accrued expenses		623,677

Total current liabilities		664,046
Derivative warrant liabilities		10,553,773
Deferred underwriting commissions		10,742,923

Total liabilities		21,960,742
Commitments and Contingencies
Class A ordinary shares subject to possible redemption; $0.0001 par value; 30,694,067 shares at $10.00 per share		306,940,670
Shareholders’ Deficit
Preference shares, $0.0001 par value; 5,000,000 shares authorized; none issued or oustanding		—
Class A ordinary shares, $0.0001 par value; 500,000,000 shares authorized; none issued and outstanding		—
Class B ordinary shares, $0.0001 par value; 50,000,000 shares authorized; 7,673,516 shares issued and outstanding		767
Additional paid-in capital		—
Accumulated deficit		(20,351,005	)

Total shareholders’ deficit		(20,350,238	)

Total Liabilities, Class A Ordinary Shares Subject to Possible Redemption and Shareholders’ Deficit	$	308,551,174

The accompanying notes are an integral part of these unaudited condensed financial statements.

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ESM ACQUISITION CORPORATION

UNAUDITED CONDENSED STATEMENTS OF OPERATIONS


	For the Three Months Ended September 30, 2021			For the period from January 13, 2021 (inception) through September 30, 2021
General and administrative expenses	$	624,280		$	981,057
General and administrative expenses - related party		30,000			67,000

Loss from operations		(654,280	)		(1,048,057	)
Other income (expenses)
Change in fair value of derivative warrant liabilities		5,596,697			9,512,278
Offering costs - derivative warrant liabilities		—			(735,150	)
Income from investments held in Trust Account		34,067			44,637

Net income	$	4,976,484		$	7,773,708

Weighted average shares outstanding of Class A ordinary shares		30,694,067			23,753,496

Basic and diluted net income per share, Class A ordinary shares	$	0.13		$	0.25

Weighted average shares outstanding of Class B ordinary shares		7,673,516			7,607,035

Basic and diluted net income per share, Class B ordinary shares	$	0.13		$	0.25

The accompanying notes are an integral part of these unaudited condensed financial statements.

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ESM ACQUISITION CORPORATION

UNAUDITED CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS’ DEFICIT

For the Three Months Ended September 30, 2021 and for the Period From January 13, 2021 (Inception) Through September 30, 2021


	Ordinary Shares										Additional						Total
	Class A				Class B						Paid-in			Accumulated			Shareholders’
	Shares		Amount		Shares			Amount			Capital			Deficit			Deficit
Balance - January 13, 2021 (inception)		—	$	—		—		$	—		$	—		$	—		$	—
Issuance of Class B ordinary shares to Sponsor		—		—		8,625,000			863			24,137			—			25,000
Excess cash received over the fair value of the private placement warrants												1,217,894						1,217,894
Accretion of Class A ordinary shares subject to possible redemption amount		—		—		—			—			(1,242,031	)		(27,552,034	)		(28,794,065	)
Net loss		—		—		—			—			—			(218,819	)		(218,819	)

Balance - March 31, 2021 (unaudited), as restated		—	$	—		8,625,000		$	863		$	—		$	(27,770,853	)	$	(27,769,990	)
Excess cash received over the fair value of the private placement warrants		—		—		—			—			40,718			—			40,718
Forfei t ure of Class B ordinary shares		—		—		(951,484	)		(96	)		96			—			—
Accretion of Class A ordinary shares subject to possible redemption amount (over-allotment)		—		—		—			—			(40,814	)		(572,679	)		(613,493	)
Net income		—		—		—			—			—			3,016,043			3,016,043

Balance - June 30, 2021 (unaudited), as restated		—	$	—		7,673,516		$	767		$	—		$	(25,327,489	)	$	(25,326,722	)
Net income		—		—		—			—			—			4,976,484			4,976,484

Balance - September 30, 2021 (unaudited)		—	$	—		7,673,516		$	767		$	—		$	(20,351,005	)	$	(20,350,238	)

The accompanying notes are an integral part of these unaudited condensed financial statements.

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ESM ACQUISITION CORPORATION

UNAUDITED CONDENSED STATEMENT OF CASH FLOWS

For the Period From January 13, 2021 (Inception) Through September 30, 2021


Cash Flows from Operating Activities:
Net income	$	7,773,708
Adjustments to reconcile net income to net cash used in operating activities:
Change in fair value of derivative warrant liabilities		(9,512,278	)
Offering costs - derivative warrant liabilities		735,150
General and administrative expenses paid by related party in exchange for issuance of Class B ordinary shares		25,000
Income from investments held in Trust Account		(44,637	)
Changes in operating assets and liabilities:
Prepaid expenses		(236,241	)
Accounts payable		40,369
Accrued expenses		517,702

Net cash used in operating activities		(701,227	)

Cash Flows from Investing Activities:
Cash deposited in Trust Account		(306,940,670	)

Net cash used in investing activities		(306,940,670	)

Cash Flows from Financing Activities:
Repayment of note payable to related party		(154,739	)
Proceeds received from initial public offering, gross		306,940,670
Proceeds received from private placement		8,638,813
Offering costs paid		(6,480,020	)

Net cash provided by financing activities		308,944,724

Net change in cash		1,302,827
Cash - beginning of the period		—

Cash - end of the period	$	1,302,827

Supplemental disclosure of noncash financing activities:
Offering costs included in accrued expenses	$	105,975
Offering costs funded with note payable	$	127,940
Prepaid expenses paid by related party under promissory note	$	26,800
Deferred underwriting commissions	$	10,742,923

The accompanying notes are an integral part of these unaudited condensed financial statements.

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ESM ACQUISITION CORPORATION

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

Note 1 - Description of Organization and Business Operations

ESM Acquisition Corporation (the “Company”) was incorporated as a Cayman Islands exempted company on January 13, 2021. The Company was formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses (the “Business Combination”). The Company is an emerging growth company and, as such, the Company is subject to all of the risks associated with emerging growth companies.

As of September 30, 2021, the Company had not commenced any operations. All activity for the period from January 13, 2021 (inception) through September 30, 2021 relates to the Company’s formation and the initial public offering (the “Initial Public Offering”) described below. The Company will not generate any operating revenues until after the completion of its initial Business Combination, at the earliest. The Company will generate

non-operating

income in the form of interest and other income on investments of the proceeds derived from the Initial Public Offering along with other income and expenses related to changes in the fair value of derivative warrant liabilities. The Company has selected December 31 as its fiscal year end.

The Company’s sponsor is ESM Sponsor, LP, a Cayman Islands exempted limited partnership (the “Sponsor”). The registration statement for the Company’s Initial Public Offering was declared effective on March 9, 2021. On March 12, 2021, the Company consummated its Initial Public Offering of 30,000,000 units (the “Units” and, with respect to the Class A ordinary shares included in the Units being offered, the “Public Shares”), at $10.00 per Unit, generating gross proceeds of $300.0 million, and incurring offering costs of approximately $17.1 million, of which $10.5 million was for deferred underwriting commissions (see Note 5). The Company granted the underwriter a

45-day

option to purchase up to an additional 4,500,000 Units at the Initial Public Offering price to cover over-allotments, if any. The underwriter partially exercised the over-allotment option and purchased an additional 694,067 Units on April 26, 2021, generating gross proceeds of approximately $6.9 million, and incurred additional offering costs of approximately $0.4 of which $0.2 million was for deferred underwriting commissions (see Note 5) (the “Over-Allotment”).

Simultaneously with the closing of the Initial Public Offering, the Company consummated the private placement (“Private Placement”) of 5,666,667 warrants (each, a “Private Placement Warrant” and collectively, the “Private Placement Warrants”), at a price of $1.50 per Private Placement Warrant with the Sponsor, generating gross proceeds of $8.5 million (see Note 4). Simultaneously with the closing of the Over-Allotment on April 26, 2021, the Company consummated the second closing of the Private Placement, resulting in the purchase of an aggregate of an additional 92,542 Private Placement Warrants by the Sponsor, generating gross proceeds to the Company of approximately $0.1 million.

Upon the closing of the Initial Public Offering, the Private Placement, and the Over-Allotment, $306.9 million ($10.00 per Unit) of the net proceeds of the Initial Public Offering and certain of the proceeds of the Private Placement was placed in a trust account (“Trust Account”), located in the United States at J.P. Morgan Chase Bank, N.A., with Continental Stock Transfer & Trust Company acting as trustee, and invested only in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended (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 selected by the Company meeting the conditions of paragraphs (d)(2), (d)(3) and (d)(4) of Rule

2a-7

of the Investment Company Act, as determined by the Company, until the earlier of: (i) the completion of a Business Combination and (ii) the distribution of the Trust Account 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 Private Placement Warrants, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. There is no assurance that the Company will be able to complete a Business Combination successfully. The Company must complete one or more initial Business Combinations having an aggregate fair market value of at least 80% of the assets held in the Trust Account (excluding the amount of any deferred underwriting discount held in trust) at the time of the signing of the agreement to enter into the initial Business Combination. However, the Company will only complete a Business Combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act.

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ESM ACQUISITION CORPORATION

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

The Company will provide its holders (the “Public Shareholders”) of the Public Shares, with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a general meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek shareholder approval of a Business Combination or conduct a tender offer will be made by the Company, solely in its discretion. The Public Shareholders will be entitled to redeem their Public Shares for a pro rata portion of the amount then in the Trust Account (initially anticipated to be $10.00 per Public Share). The

per-share

amount to be distributed to Public Shareholders who redeem their Public Shares will not be reduced by the deferred underwriting commissions the Company will pay to the underwriters (as discussed in Note 5). These Public Shares were classified as temporary equity in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 480, “Distinguishing Liabilities from Equity” (“ASC 480”). In such case, the Company will proceed with a Business Combination if the Company has net tangible assets of at least $5,000,001 upon such consummation of a Business Combination and a majority of the shares voted are voted in favor of the Business Combination. If a shareholder vote is not required by law 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 (the “Amended and Restated Memorandum and Articles of Association”), conduct the redemptions pursuant to the tender offer rules of the U.S. Securities and Exchange Commission (“SEC”) and file tender offer documents with the SEC prior to completing a Business Combination. If, however, shareholder approval of the transactions is required by law, or the Company decides to obtain shareholder approval for business or legal reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer rules. Additionally, each Public Shareholder may elect to redeem their Public Shares irrespective of whether they vote for or against the proposed transaction. If the Company seeks shareholder approval in connection with a Business Combination, the initial shareholders (as defined below) agreed to vote their Founder Shares (as defined below in Note 4) and any Public Shares purchased during or after the Initial Public Offering in favor of a Business Combination. Upon the consummation of the Initial Public Offering, the Company adopted an insider trading policy which requires insiders to: (i) refrain from purchasing shares during certain blackout periods and when they are in possession of any material

non-public

information and (ii) to clear all trades with the Company’s legal counsel prior to execution. In addition, the initial shareholders agreed to waive their redemption rights with respect to their Founder Shares and Public Shares in connection with the completion of a Business Combination.

Notwithstanding the foregoing, the Amended and Restated Memorandum and Articles of Association will provide that a Public Shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming its shares with respect to more than an aggregate of 15% or more of the Class A ordinary shares sold in the Initial Public Offering, without the prior consent of the Company.

The Company’s Sponsor, officers and directors (the “initial shareholders”) agreed not to propose an amendment to the Amended and Restated Memorandum and Articles of Association that would modify the substance or timing of the Company’s obligation to redeem 100% of its Public Shares if the Company does not complete a Business Combination, unless the Company provides the Public Shareholders with the opportunity to redeem their Class A ordinary shares in conjunction with any such amendment.

If the Company is unable to complete a Business Combination within 24 months from the closing of the Initial Public Offering, or March 12, 2023 (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 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 earned on the funds held in the Trust Account (less taxes payable and up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish Public Shareholders’ rights as shareholders (including the right to receive further liquidation distributions, if any) and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the remaining shareholders and the board of directors, liquidate and dissolve, subject, in the case of clauses (ii) and (iii), to the Company’s obligations under Cayman Islands law to provide for claims of creditors and in all cases subject to the other requirements of applicable law. There will be no redemption rights or liquidating distributions with respect to the warrants, which will expire worthless if the Company fails to complete its initial Business Combination within the Combination Period.

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ESM ACQUISITION CORPORATION

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

The Sponsor agreed to waive

their

liquidation rights with respect to the Founder Shares if the Company fails to complete a Business Combination within the Combination Period. However, if the Sponsor or members of the Company’s management team acquire Public Shares in or after the Initial Public Offering, they will be entitled to liquidating distributions from the Trust Account with respect to such Public Shares if the Company fails to complete a Business Combination within the Combination Period. The underwriters agreed to waive their rights to their deferred underwriting commission (see Note 5) 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 residual assets remaining available for distribution (including Trust Account assets) will be only $10.00 per share initially held in the Trust Account. In order to protect the amounts held in the Trust Account, the Sponsor agreed to be liable to the Company if and to the extent any claims by a vendor 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. This liability will not apply with respect to any claims by a third party who executed a waiver of any right, title, interest or claim of any kind in or to any monies held in the Trust Account or 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”). Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers, except the 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.

Liquidity

Prior to the completion of the Initial Public Offering, the Company lacked the liquidity it needed to sustain operations for a reasonable period or time, which is considered to be one year from the issuance date of the financial statement

. The Company has since completed its Initial Public Offering at which time capital in excess of the funds deposited in the trust and/or used to fund offering expenses was released to the Company for general working capital purposes. Accordingly, management has since reevaluated the Company’s liquidity and financial condition and determined that sufficient capital exists to sustain operations one year from the date these financial statements are issued and therefore substantial doubt has been alleviated.

Risks and Uncertainties

Management continues to evaluate the impact of the

COVID-19

global pandemic on the industry 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 financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Note 2 - Basis of Presentation and Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed financial statements are presented in U.S. dollars in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for financial information and pursuant to the rules and regulations of the SEC. Accordingly, they do not include all of the information and footnotes required by GAAP for annual financial statements. In the opinion of management, the unaudited condensed financial statements reflect all adjustments, which include only normal recurring adjustments necessary for the fair statement of the balances and results for the periods presented. Operating results for the three months ended September 30, 2021 and for the period from January 13, 2021 (inception) through September 30, 2021 are not necessarily indicative of the results that may be expected through December 31, 2021.

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ESM ACQUISITION CORPORATION

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

Restatement of Previously Reported Financial Statements

In preparation of the Company’s unaudited condensed financial statements for the quarterly period ended September 30, 2021, the Company concluded it should restate its previously issued financial statements to classify all Class A ordinary shares subject to possible redemption in temporary equity. In accordance with the SEC and its staff’s guidance on redeemable equity instruments in ASC 480-10-S99, redemption provisions not solely within the control of the Company require ordinary shares subject to redemption to be classified outside of permanent equity. The Company had previously classified a portion of its Class A ordinary shares in permanent equity. Although the Company did not specify a maximum redemption threshold, its charter provides that currently, the Company will not redeem its public shares in an amount that would cause its net tangible assets to be less than $5,000,001. Previously, the Company did not consider redeemable shares classified as temporary equity as part of net tangible assets. Effective with these condensed financial statements, the Company revised this interpretation to include temporary equity in net tangible assets. As a result, the Company restated its previously filed financial statements to present all Class A ordinary shares subject to possible redemption as temporary equity and to recognize accretion from the initial book value to redemption value at the time of its Initial Public Offering and the Over-Allotment. The Company’s previously filed financial statements that contained the error were reported in the Company’s Form 8-K filed with the SEC on March 18, 2021 (the “Post-IPO Balance Sheet”) and the Company’s Form 10-Qs for the quarterly periods ended March 31, 2021, and June 30, 2021 (the “Affected Quarterly Periods”).

The impact of the revision to the Post-IPO Balance Sheet is an increase to Class A ordinary shares subject to possible redemption of approximately $33.3 million, a decrease to additional paid-in capital of $5.5 million, an increase to the accumulated deficit of $27.8 million, and the reclassification of 3,333,048 Class A ordinary shares from permanent equity to Class A ordinary shares subject to possible redemption.


As of March 12, 2021	As Reported			Adjustment			As Restated
Total assets	$	302,526,800					$	302,526,800

Total liabilities	$	30,857,277					$	30,857,277

Class A ordinary shares subject to possible redemption		266,669,520			33,330,480			300,000,000
Preference shares		—			—			—
Class A ordinary shares		333			(333	)		—
Class B ordinary shares		863			—			863
Additional paid-in capital		5,480,393			(5,480,393	)		—
Retained earnings (accumulated deficit)		(481,586	)		(27,849,754	)		(28,331,340	)

Total shareholders’ equity (deficit)	$	5,000,003		$	(33,330,480	)	$	(28,330,477	)

Total Liabilities, Class A Ordinary Shares Subject to Possible Redemption and Shareholders’ Equity (Deficit)	$	302,526,800		$	—		$	302,526,800

The impact of the restatement on the financial statements for the Affected Quarterly Periods is presented below.

The table below presents the effect of the financial statement adjustments related to the restatement discussed above of the Company’s previously reported balance sheet as of March 31, 2021:


As of March 31, 2021	As Reported			Adjustment			As Restated
Total assets	$	302,027,864					$	302,027,864

Total liabilities	$	29,797,854					$	29,797,854

Class A ordinary shares subject to possible redemption		267,230,000			32,770,000			300,000,000
Preference shares		—			—			—
Class A ordinary shares		328			(328	)		—
Class B ordinary shares		863			—			863
Additional paid-in capital		5,217,638			(5,217,638	)		—
Retained earnings (accumulated deficit)		(218,819	)		(27,552,034	)		(27,770,853	)

Total shareholders’ equity (deficit)	$	5,000,010		$	(32,770,000	)	$	(27,769,990	)

Total Liabilities, Class A Ordinary Shares Subject to Possible Redemption and Shareholders’ Equity (Deficit)	$	302,027,864		$	—		$	302,027,864

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ESM ACQUISITION CORPORATION

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

The table below presents the effect of the financial statement adjustments related to the restatement discussed above of the Company’s previously reported statement of cash flows for the period from January 13, 2021 (inception) through March 31, 2021:


Form 10-Q: For the Period from January 13, 2021 (Inception) Through March 31, 2021
	As Reported			Adjustment			As Restated
Cash Flow Used In Operating Activities	$	(471,139	)	$	—		$	(471,139	)
Cash Flows Used In Investing Activities	$	(300,000,000	)	$	—		$	(300,000,000	)
Cash Flows Provided By Financing Activities	$	1,603,039		$	—		$	1,603,039
Supplemental Disclosure of Noncash Financing Activities:
Offering costs included in accrued expenses	$	176,099		$	—		$	176,099
Offering costs paid by related party under promissory note	$	127,940		$	—		$	127,940
Reclassification of offering costs from liabilities to additional paid in capital	$	304,039		$	—		$	304,039
Prepaid expenses paid by related party under promissory note	$	26,800		$	—		$	26,800
Deferred underwriting commissions in connection with the initial public offering	$	10,500,000		$	—		$	10,500,000
Initial value of Class A ordinary shares subject to possible redemption	$	266,669,520		$	(266,669,520	)	$	—
Change in value of Class A ordinary shares subject to possible redemption	$	560,480		$	(560,480	)	$	—

The table below presents the effect of the financial statement adjustments related to the restatement discussed above of the Company’s previously reported balance sheet as of June 30, 2021:


As of June 30, 2021	As Reported		Adjustment			As Restated
Total assets	$	308,728,695				$	308,728,695

Total liabilities	$	27,114,747				$	27,114,747

Class A ordinary shares subject to possible redemption		276,613,940		30,326,730			306,940,670
Preference shares		—		—			—
Class A ordinary shares		303		(303	)		—
Class B ordinary shares		767		—			767
Additional paid-in capital		2,201,714		(2,201,714	)		—
Retained earnings (accumulated deficit)		2,797,224		(28,124,713	)		(25,327,489	)

Total shareholders’ equity (deficit)	$	5,000,008	$	(30,326,730	)	$	(25,326,722	)

Total Liabilities, Class A Ordinary Shares Subject to Possible Redemption and Shareholders’ Equity (Deficit)	$	308,728,695	$	—		$	308,728,695


Form 10-Q: For the Period from January 13, 2021 (Inception) Through June 30, 2021
	As Reported			Adjustment			As Restated
Cash Flow Used In Operating Activities	$	(574,019	)	$	—		$	(574,019	)
Cash Flows Used In Investing Activities	$	(309,940,670	)	$	—		$	(309,940,670	)
Cash Flows Provided By Financing Activities	$	308,951,524		$	—		$	308,951,524
Supplemental Disclosure of Noncash Financing Activities:
Offering costs included in accrued expenses	$	112,775		$	—		$	112,775
Offering costs funded with note payable	$	127,940		$	—		$	127,940
Prepaid expenses paid by related party under promissory note	$	26,800		$	—		$	26,800
Deferred underwriting commissions in connection with the initial public offering	$	10,742,923		$	—		$	10,742,923
Initial value of Class A ordinary shares subject to possible redemption	$	286,392,250		$	(286,392,250	)	$	—
Change in value of Class A ordinary shares subject to possible redemption	$	(9,778,300	)	$	9,778,300		$	—

Table of Contents

In connection with the change in presentation for the Class A ordinary shares subject to possible redemption, the Company has revised its earnings per share calculation to allocate income and losses shared pro rata between the two classes of shares. This presentation contemplates a Business Combination as the most likely outcome, in which case, both classes of shares participate pro rata in the income and losses of the Company. The impact to the reported amounts of weighted average shares outstanding and basic and diluted earnings per common share is presented below for the Affected Quarterly Periods:


	EPS for Class A ordinary shares
	As Reported			Adjustment			As Adjusted
Form 10-Q (March 31, 2021) - For the Period from January 13, 2021 (Inception) Through March 31, 2021
Net loss	$	(218,819	)	$	—		$	(218,819	)
Weighted average shares outstanding		28,543,413			(20,851,105	)		7,692,308
Basic and diluted loss per share	$	—		$	(0.01	)	$	(0.01	)
Form 10-Q (June 30, 2021) - three months ended June 30, 2021
Net income	$	3,016,043		$	—		$	3,016,043
Weighted average shares outstanding		26,733,312			3,770,077			30,503,389
Basic and diluted earnings per share	$	—		$	0.08		$	0.08
Form 10-Q (June 30, 2021) - For the Period from January 13, 2021 (Inception) Through June 30, 2021
Net income	$	2,797,224		$	—		$	2,797,224
Weighted average shares outstanding		27,059,456

SEC Form 10-Q filed by ESM Acquisition Corporation