UNITED STATES

SECURITIES AND EXCHANGE

COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended June 30, 2021

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

For the transition period from to

Commission File No. 001-39850

KL Acquisition Corp

(Exact name of registrant as specified in its charter)

Delaware

85-2734828

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

111 West 33rd Street, Suite 1910

New York, NY 10120

(Address of Principal Executive Offices, including zip code)

(212) 782-3482

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, 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 share of Class A common stock, $0.0001 par value, and one-third of one redeemable warrant	KLAQU	The Nasdaq Stock Market LLC
Class A common stock included as part of the units	KLAQ	The Nasdaq Stock Market LLC
Redeemable warrants included as part of the units	KLAQW	The Nasdaq Stock Market LLC

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, a 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.

	☐ Large accelerated filer	☐ Accelerated filer
	☒ Non-accelerated filer	☒ Smaller reporting company
		☒ Emerging growth company

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 August 19, 2021, there were 28,750,000 shares of Class A common stock, par value $0.0001 per share and 7,187,500 shares of the company’s Class B common stock, par value $0.0001 per share, of the registrant issued and outstanding.

		Page
PART 1 – FINANCIAL INFORMATION

Item 1.	Financial Statements	3

	Condensed Balance Sheets as of June 30, 2021 (Unaudited) and December 31, 2020	3

	Condensed Statements of Operations for the Three Months and Six Months Ended June 30, 2021 (Unaudited)	4

	Condensed Statement of Changes in Stockholders’ Equity for the Six Months Ended June 30, 2021 (Unaudited)	5

	Condensed Statement of Cash Flows for the Six Months Ended June 30, 2021 (Unaudited)	6

	Notes to Condensed Financial Statements (Unaudited)	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	22

Item 4.	Controls and Procedures	23

PART II – OTHER INFORMATION		24

Item 1.	Legal Proceedings	24

Item 1A.	Risk Factors	24

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	24

Item 3.	Defaults Upon Senior Securities	24

Item 4.	Mine Safety Disclosures	24

Item 5.	Other Information	24

Item 6.	Exhibits	25

SIGNATURES		26


	June 30, 2021		December 31, 2020
	(Unaudited)
Assets
Current assets:
Cash	$	720,200	$	—
Prepaid expenses		347,481		—
Deferred offering costs associated with IPO		—		408,197
Total current assets		1,067,681		408,197
Cash Held in Trust account		287,559,908		—
Other non-current assets		156,164		—
Total assets	$	288,783,753	$	408,197

Liabilities and Stockholders’ Equity (Deficit)
Current liabilities:
Accounts payable and accrued expenses	$	281,028	$	231,809
Franchise tax payable		100,000		71,289
Sponsor loans		—		152,031
Total current liabilities		381,028		455,129
Warrant Liabilities		13,846,266		—
Deferred underwriters’ discount		10,062,500		—
Total liabilities		24,289,794		455,129

Commitments

Common stock subject to possible redemption, 25,949,396 shares at redemption value		259,493,958		—

Stockholders’ equity (deficit):
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding		—		—
Class A common stock, $0.0001 par value; 200,000,000 shares authorized; 2,800,604 shares (excluding 25,949,396 shares subject to possible redemption) and 0 shares issued and outstanding at June 30, 2021 and December 31, 2020, respectively		279		—
Class B common stock, $0.0001 par value; 20,000,000 shares authorized; 7,187,500 shares issued and outstanding		719		719
Additional paid-in capital		4,667,226		24,281
Retained earnings (Accumulated Deficit)		331,777		(71,932)
Total stockholders’ equity (deficit)		5,000,001		(46,932)
Total liabilities and stockholders’ equity (deficit)	$	288,783,753	$	408,197


	For the		For the
	three months ended		six months ended
	June 30,		June 30,
	2021		2021
Formation and operating costs	$	488,900	$	577,754
Loss from operations		(488,900)		(577,754)

Other Income (Expense)
Interest on cash held in trust account		16,052		59,908
Change in fair value of warrant liabilities		(4,194,429)		5,343,573
Offering expenses related to warrant issuance		—		(701,643)
Total other income (expense)		(4,178,377)		4,701,838

Net (loss) income	$	(4,667,277)	$	4,124,084

Weighted average shares outstanding, Class A common stock subject to possible redemption		26,410,994		25,985,664
Basic and diluted net income per share, Class A common stock subject to possible redemption	$	—	$	—
Weighted average shares outstanding, Non-redeemable common stock		9,526,506		9,783,838
Basic and diluted net (loss) income per share, Non-redeemable	$	(0.49)	$	0.42


	Common Stock						Additional		Retained Earnings		Total
	Class A			Class B			Paid-In		(Accumulated		Stockholders’
	Shares	Amount		Shares	Amount		Capital		Deficit)		Equity
Balance as of January 1 , 2021	—	$	—	7,187,500	$	719	$	24,281	$	(71,932)	$	(46,932)

Sale of Units in Initial Public Offering, net of underwriter fee and fair value of public warrants	28,750,000		2,875	—		—		259,432,449		—		259,435,324

Excess of cash received over fair value of private placement warrants	—		—	—		—		981,483		—		981,483

Class A common stock subject to possible redemption	(26,416,123)		(2,642)	—		—		(260,438,213)		(3,720,375)		(264,161,230)

Net income	—		—	—		—		—		8,791,361		8,791,361

Balance as of March 31, 2021	2,333,877	$	233	7,187,500	$	719	$	—	$	4,999,054	$	5,000,006

Class A common stock subject to possible redemption	466,727		46	—		—		946,851		3,720,375		4,667,272

Net loss	—		—	—		—		—		(4,667,277)		(4,667,277)

Balance as of June 30, 2021	2,800,604	$	279	7,187,500	$	719	$	946,851	$	331,777	$	5,000,001


Cash Flows from Operating Activities:
Net income	$	4,124,084
Adjustments to reconcile net income to net cash used in operating activities:
Interest earned on trust account		(59,908)
Change in fair value of warrant liabilities		(5,343,573)
Offering costs allocated to warrants		701,643
Changes in current assets and current liabilities:
Prepaid assets		(503,645)
Franchise tax payable		28,711
Accounts payable		281,028
Net cash used in operating activities		(771,660)

Cash Flows from Investing Activities:
Investment of cash into trust account		(287,500,000)
Net cash used in investing activities		(287,500,000)

Cash Flows from Financing Activities:
Proceeds from Initial Public Offering, net of underwriters' discount		281,750,000
Proceeds from private placement		7,750,000
Repayment of promissory note to related party		(152,031)
Payments of offering costs		(356,109)
Net cash provided by financing activities		288,991,860

Net Change in Cash		720,200
Cash — Beginning		—
Cash — Ending	$	720,200

Supplemental Disclosure of Non-cash Financing Activities:
Initial value of Class A common stock subject to possible redemption	$	254,839,270
Change in value of Class A common stock subject to possible redemption	$	4,654,688
Initial value of warrant liabilities	$	19,189,839
Deferred underwriters’ discount payable charged to additional paid-in capital	$	10,062,500


	Three Months		Six Months
	Ended		Ended
	June 30, 2021		June 30, 2021
	(Unaudited)		(Unaudited)
Redeemable Class A Common Stock
Numerator: Earnings allocable to Redeemable Class A Common Stock
Interest income on investments held in Trust Account	$	16,052	$	59,908
Amount available to pay franchise taxes		(16,052)		(59,908)
Net earnings	$	—	$	—
Denominator: Weighted average Redeemable Class A Common Stock
Basic and diluted weighted average shares outstanding, Redeemable Class A Common Stock		26,410,994		25,985,664
Basic and diluted net earnings per share, Redeemable Class A Common Stock	$	0.00	$	0.00
Non-Redeemable Class A and Class B Common Stock
Numerator: Net (loss) income minus net earnings
Net (loss) income	$	(4,667,277)	$	4,124,084
Net earnings		—		—
Non-redeemable net (loss) income	$	(4,667,277)	$	4,124,084
Denominator: Weighted average Non-Redeemable Class A and Class B Common Stock
Basic and diluted weighted average shares outstanding, Non-Redeemable Class A and Class B Common Stock		9,526,506		9,783,838
Basic and diluted net (loss) income per share, Non-Redeemable Class A and Class B Common Stock	$	(0.49)	$	0.42


	Level 1		Level 2		Level 3
Investment held in the Trust Account	$	287,559,908	$	—	$	—
Public Warrants	$	8,987,250	$	—	$	—
Private Warrants	$	—	$	—	$	4,859,016


	At January 12, 2021
	(Initial Measurement)			At June 30, 2021
Stock price	$	9.95		$	9.70
Strike price	$	11.50		$	11.50
Term (in years)		6.00			5.00
Volatility		25.0	%		10.0	%
Risk-free rate		0.67	%		1.00	%
Dividend yield		0.0	%		0.0	%


Fair value as of August 26, 2020	$	—
Initial measurement on January 12, 2021		19,189,839
Public Warrants reclassified to level 1⁽¹⁾		(6,229,166)
Change in fair value		(8,101,657)
Fair Value at June 30, 2021		4,859,016

Exhibit No.		Description
3.1		Amended and Restated Certificate of Incorporation. (1)
3.2		Bylaws. (2)
4.1		Warrant Agreement, dated January 7, 2021, by and between the company and Continental Stock Transfer & Trust Company, as warrant agent. (1)
31.1		Certification of the Principal Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a).*
31.2		Certification of the Principal Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a).*
32.1		Certification of the Principal Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350**
32.2		Certification of the Principal Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350**
101.INS*		Inline XBRL Instance Document
101.SCH*		Inline XBRL Taxonomy Extension Schema Document
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*		Inline XBRL Taxonomy Extension Labels Linkbase Document
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104*		Cover Page Interactive Data File––the cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

	KL Acquisition Corp

	By:	/s/ Doug Logigian
	Name:	Doug Logigian
	Title:	Chief Executive Officer
		(Principal Executive Officer)

	By:	/s/ Richard Gumer
	Name:	Richard Gumer
	Title:	Chief Financial Officer and Secretary
		(Principal Financial and Accounting Officer)

SEC Form 10-Q filed by KL Acquisition Corp