References to the "Company," "SVF Investment Corp." "our," "us" or "we" refer to
SVF Investment Corp. The following discussion and analysis of the Company's
financial condition and results of operations should be read in conjunction with
the financial statements and the notes thereto contained elsewhere in this
report. Certain information contained in the discussion and analysis set forth
below includes forward-looking statements that involve risks and uncertainties.
Cautionary Note Regarding Forward-Looking Statements
This Quarterly Report on Form
10-Q
includes forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Exchange Act. We have
based these forward-looking statements on our current expectations and
projections about future events. These forward-looking statements are subject to
known and unknown risks, uncertainties and assumptions about us that may cause
our actual results, levels of activity, performance or achievements to be
materially different from any future results, levels of activity, performance or
achievements expressed or implied by such forward-looking statements. In some
cases, you can identify forward-looking statements by terminology such as "may,"
"should," "could," "would," "expect," "plan," "anticipate," "believe,"
"estimate," "continue," or the negative of such terms or other similar
expressions. Factors that might cause or contribute to such a discrepancy
include, but are not limited to, those described in our other SEC filings.
Overview
We are a blank check company incorporated as a Cayman Islands exempted company
on October 5, 2020. We were 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"). We are an
emerging growth company and, as such, we are subject to all of the risks
associated with emerging growth companies.
Our sponsor is SVF Sponsor LLC, a Delaware limited liability company (the
"Sponsor"). The registration statement for our Initial Public Offering was
declared effective on January 7, 2021. On January 12, 2021, we consummated its
Initial Public Offering of 60,375,000 units (the "Units" and, with respect to
the Class A ordinary shares included in the Units being offered, the "Public
Shares"), including 7,875,000 additional Units to cover over-allotments (the
"Over-Allotment Units"), at $10.00 per Unit, generating gross proceeds of
approximately $603.8 million, and incurring offering costs of approximately
$33.9 million, of which approximately $21.1 million was deferred underwriting
commissions. On April 22, 2021, the underwriters made a payment to us in an
amount of $600,000 to reimburse certain of our expenses in connection with this
offering.
Simultaneously with the closing of the Initial Public Offering, we consummated
the private placement ("Private Placement") of 9,383,333 warrants (each, a
"Private Placement Warrant" and collectively, the "Private Placement Warrants"),
at a price of $1.50 per Private Placement Warrant with our Sponsor, generating
gross proceeds of approximately $14.1 million.
Upon the closing of the Initial Public Offering and the Private Placement,
approximately $603.8 million ($10.00 per Unit) of the net proceeds of the
Initial Public Offering and certain of the proceeds of the Private Placement
were placed in a trust account ("Trust Account") with Continental Stock
Transfer & Trust Company acting as trustee and invested in United States
"government securities" within the meaning of Section 2(a)(16) of the Investment
Company Act having a maturity of 185 days or less or in money market funds
meeting certain conditions under Rule
2a-7
promulgated under the Investment Company Act of 1940, as amended, or the
Investment Company Act. which invest only in direct U.S. government treasury
obligations, 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.
If we are unable to complete a Business Combination within 24 months from the
closing of the Initial Public Offering, or January 12, 2023, (the "Combination
Period"), we 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
and not previously released to us to pay our income taxes, if

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any (less up to $100,000 of interest to pay dissolution expenses), divided by
the number of the 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 our obligations
under Cayman Islands law to provide for claims of creditors and the requirements
of other applicable law.
Liquidity and Capital Resources
As of September 30, 2021, we had approximately $1.3 million in operating bank
account, and working capital deficit of approximately $551,000.
Our liquidity needs to date have been satisfied through a contribution of
$25,000 from Sponsor to cover certain expenses in exchange for the issuance of
the Founder Shares, a loan of up to approximately $300,000 from the Sponsor
pursuant to the Note, of which approximately $173,000 was outstanding as of
December 31, 2020 and approximately $296,000 in total prior to the Initial
Public Offering, and subsequent to the Initial Public Offering, the proceeds of
$2.0 million from the consummation of the Private Placement not held in the
Trust Account. We repaid the Note in full on January 13, 2021. In addition, in
order to finance transaction costs in connection with a Business Combination,
the Sponsor or an affiliate of the Sponsor, or certain of our officers and
directors may, but are not obligated to, provide us Working Capital Loans. As of
September 30, 2021, $2.0 million was drawn under the Working Capital Loan.
In August 2021, we entered a Loan Agreement (the "Agreement") with our Sponsor
which is attached hereto as Exhibit 105 and incorporated by reference herein,
pursuant to which we may borrow up to $1,000,000 from our Sponsor for ongoing
expenses reasonably related to our business and the consummation of the Business
Combination. There will be no interest accrued under the Agreement. All unpaid
principal under the Agreement will be due and payable in full on the effective
date of the Business Combination.
Based on the foregoing, management believes that it will have sufficient working
capital and borrowing capacity to meet its needs through the earlier of the
consummation of a business combination or one year from this filing. Over this
time period, we will be using these funds for paying existing accounts payable,
identifying and evaluating prospective initial business combination candidates,
performing due diligence on prospective target businesses, paying for travel
expenditures, selecting the target business to merge with or acquire, and
structuring, negotiating and consummating the business combination.
Management continues to evaluate the impact of the
COVID-19
pandemic and has concluded that the specific impact is not readily determinable
as of the date of the unaudited condensed financial statements. The unaudited
condensed financial statements do not include any adjustments that might result
from the outcome of this uncertainty.
Results of Operations
Our entire activity since inception up to September 30, 2021 was in preparation
for our formation and the Initial Public Offering. We will not be generating any
operating revenues until the closing and completion of our initial Business
Combination.
For the three months ended September 30, 2021, we had net income of
approximately $14.9 million, which consisted of change in fair value of
derivative liabilities of approximately $14.3 million, change in fair value of
working capital loan of approximately $974,000 and income from investments held
in the Trust Account of approximately $9,000, partially offset by general and
administrative expenses of approximately $416,000 and general and administrative
expenses to related party of $30,000.
For the nine months ended September 30, 2021, we had net income of approximately
$22.7 million, which consisted of change in fair value of derivative liabilities
of approximately $153.1 million, change in fair value of working capital loan of
approximately $2.0 million and income from investments held in the Trust Account
of approximately $26,000, partially offset by general and administrative
expenses of approximately $2.0 million, general and administrative expenses to
related party of approximately $28.1 million, offering costs associated with
derivative liabilities of

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approximately $2.6 million, loss on the forward purchase agreement of
approximately $97.4 million and loss on working capital loan of approximately
$2.3 million. Of the approximately $28.1 million in general and administrative
expenses with related parties, approximately $28.1 million is a noncash charge
for the excess initial fair value of Private Placement Warrants over the
purchase price for such warrants paid by our Sponsor.
Contractual Obligations
Registration and Shareholder Rights
The holders of the Founder Shares, Private Placement Warrants, and warrants that
may be issued upon conversion of Working Capital Loans (and any Class A ordinary
shares issuable upon the exercise of the Private Placement Warrants and warrants
that may be issued upon conversion of Working Capital Loan) were entitled to
registration rights pursuant to a registration and shareholder rights agreement.
The holders of these securities were entitled to make up to three demands,
excluding short form demands, that we register such securities. In addition, the
holders have certain "piggy-back" registration rights with respect to
registration statements filed subsequent to the completion of the initial
Business Combination. We will bear the expenses incurred in connection with the
filing of any such registration statements.
Underwriting Agreement
We granted the underwriters a
45-day
option from the date of this prospectus to purchase up to 7,875,000 additional
Units at the Initial Public Offering price less the underwriting discounts and
commissions. On January 12, 2021, the underwriters fully exercised the
over-allotment option.
The underwriters were entitled to an underwriting discount of $0.20 per unit, or
approximately $12.1 million in the aggregate, paid upon the closing of the
Initial Public Offering. In addition, $0.35 per unit, or approximately
$21.1 million in the aggregate will be payable to the underwriters for deferred
underwriting commissions. The deferred fee will become payable to the
underwriters from the amounts held in the Trust Account solely in the event that
we complete a Business Combination, subject to the terms of the underwriting
agreement.
Forward Purchase Agreement
We entered into a forward purchase agreement (a "Forward Purchase Agreement")
with certain investors (the "Forward Purchase Investor"), which provides for the
purchase of $250,000,000 of forward purchase units (the "Forward Purchase
Units"), with each unit consisting of one Class A ordinary share (a "Forward
Purchase Share") and
one-fifth
of one warrant to purchase one Class A ordinary share at $11.50 per share (a
"Forward Purchase Warrant"), for a purchase price of $10.00 per unit, in a
private placement to occur concurrently with the closing of the initial Business
Combination. The Forward Purchase Agreement also provides that the Forward
Purchase Investor may elect to purchase up to an additional $50,000,000 of
Forward Purchase Units, which will also have a purchase price of $10.00 per Unit
and consist of one Class A ordinary share and
one-fifth
of one warrant. Any elections to purchase up to 5,000,000 additional Forward
Purchase Units will take place in one or more private placements in such amounts
and at such time as the Forward Purchase Investor determines, but no later than
simultaneously with the closing of the initial Business Combination. We and the
Forward Purchase Investor may determine, by mutual agreement, to increase the
number of additional Forward Purchase Units at any time prior to the initial
Business Combination. The obligations under the Forward Purchase Agreement do
not depend on whether any Class A ordinary shares are redeemed by the Public
Shareholders. The forward purchase securities will be issued only in connection
with the closing of the initial Business Combination. The proceeds from the sale
of forward purchase securities may be used as part of the consideration to the
sellers in the initial Business Combination, expenses in connection with the
initial Business Combination or for working capital in the post-transaction
company.
Critical Accounting Policies
Working Capital Loan - Related Party
We have elected the fair value option to account for our working capital loan -
related party with our Sponsor. As a result of applying the fair value option,
we record each draw at fair value with a gain or loss recognized at issuance,
and subsequent changes in fair value are recorded as change in the fair value of
working capital loan - related party on the condensed statement of operations.
The fair value is based on prices or valuation techniques that require inputs
that are both unobservable and significant to the overall fair value
measurement. These inputs reflect management's and, if applicable, an
independent third-party valuation firm's own assumption about the assumptions a
market participant would use in pricing the asset or liability.


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Derivative Liabilities
We do not use derivative instruments to hedge exposures to cash flow, market, or
foreign currency risks. We evaluate all of our financial instruments, including
issued stock purchase warrants, to determine if such instruments are derivatives
or contain features that qualify as embedded derivatives, pursuant to ASC 480
and ASC
815-15.
The classification of derivative instruments, including whether such instruments
should be recorded as liabilities or as equity, is
re-assessed
at the end of each reporting period.
The 12,075,000 warrants issued in connection with the Initial Public Offering
(the "Public Warrants"), the 9,383,333 Private Placement Warrants, the 5,000,000
committed forward purchase warrants and the 1,000,000 additional forward
purchase warrants are recognized as derivative liabilities in accordance with
ASC
815-40.
Accordingly, we recognize the warrant instruments as liabilities at fair value
and the difference between the fair value and the book value recognized as a
loss. We adjust the instruments to fair value at each reporting period. The
liabilities are subject to
re-measurement
at each balance sheet date until exercised, and any change in fair value is
recognized in our unaudited condensed statement of operations. The fair value of
the Public Warrants issued in connection with the Public Offering, Private
Placement Warrants and forward purchase agreement were initially measured at
fair value using a Monte Carlo simulation model and subsequently, the fair value
of the Private Placement Warrants and forward purchase warrants have been
estimated using a Monte Carlo simulation model each measurement date. The fair
value of Public Warrants issued in connection with the Initial Public Offering
have subsequently been measured based on the listed market price of such
warrants.
Offering Costs Associated with the Initial Public Offering
Offering costs consisted of legal, accounting, underwriting fees and other costs
incurred through the Initial Public Offering that were directly related to the
Initial Public Offering. Offering costs are allocated to the separable financial
instruments issued in the Initial Public Offering based on a relative fair value
basis, compared to total proceeds received. Offering costs associated with
derivative liabilities are expensed as incurred, presented as
non-operating
expenses in the statement of operations. Offering costs associated with the
Class A ordinary shares were included in temporary equity along with accretion
of the Class A ordinary shares. For the three months ended September 30, 2021,
there were no such costs included in the unaudited condensed statement of
operations. For the nine months ended September 30, 2021, of the total offering
costs of the Initial Public Offering, approximately $2.6 million was included in
offering cost-derivative liabilities in the unaudited condensed statement of
operations. We classified deferred underwriting commissions as
non-current
liabilities as our liquidation is not reasonably expected to require the use of
current assets or require the creation of current liabilities.
Class A Ordinary Shares Subject to Possible Redemption
We account for our Class A ordinary shares subject to possible redemption in
accordance with the guidance in Financial Accounting Standards Board ("FASB")
Accounting Standards Codification ("ASC") Topic 480 "Distinguishing Liabilities
from Equity." Class A ordinary shares subject to mandatory redemption (if any)
are classified as liability instruments and are measured at fair value.
Conditionally redeemable Class A ordinary shares (including Class A ordinary
shares that feature redemption rights that are either within the control of the
holder or subject to redemption upon the occurrence of uncertain events not
solely within our control) are classified as temporary equity. At all other
times, Class A ordinary shares are classified as shareholders' equity. Our
Class A ordinary shares feature certain redemption rights that are considered to
be outside of the Company's control and subject to the occurrence of uncertain
future events. Accordingly, 60,375,000 Class A ordinary shares subject to
possible redemption are presented as temporary equity, outside of the
shareholders' equity (deficit) section of our unaudited condensed balance
sheets.
We recognized the accretion from initial book value to redemption amount value.
The change in the carrying value of redeemable shares of Class A ordinary shares
resulted in charges against additional
paid-in
capital and accumulated deficit.

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Net Income (Loss) per Ordinary Shares
We comply with accounting and disclosure requirements of FASB ASC Topic 260,
"Earnings Per Share." We have two classes of shares, which are referred to as
Class A ordinary shares and Class B ordinary shares. Income and losses are
shared pro rata between the two classes of shares. Net income (loss) per
ordinary share is calculated by dividing the net income (loss) by the
weighted-average number of ordinary shares outstanding for the respective
period.
The calculation of diluted net income (loss) per ordinary share does not
consider the effect of the warrants issued in connection with the Initial Public
Offering and the Private Placement to purchase an aggregate of 21,458,333
ordinary shares since their inclusion would be anti-dilutive under the treasury
stock method. As a result, diluted net income (loss) per ordinary share is the
same as basic net income (loss) per ordinary share for the three and nine months
ended September 30, 2021. Accretion associated with the redeemable Class A
ordinary shares is excluded from earnings per share as the redemption value
approximates fair value.
Non-cash
compensation to Sponsor
We record
non-cash
compensation recognized as a result of the fair value of the Private Placement
Warrants being in excess of the amount paid by the Sponsor, pursuant to ASC 718,
Share-based Compensation.
Recent Accounting Pronouncements
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's Own Equity (Subtopic
815-40):
Accounting for Convertible Instruments and Contracts in an Entity's 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. The Company adopted ASU
2020-06
on January 1, 2021. Adoption of the ASU did not impact the Company's financial
position, results of operations or cash flows.
Our management does not believe that any recently issued, but not yet effective,
accounting standards updates, if currently adopted, would have a material effect
on the accompanying unaudited condensed financial statements.
Off-Balance
Sheet Arrangements
As of September 30, 2021, we did not have any
off-balance
sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation
S-K.
JOBS Act
The Jumpstart Our Business Startups Act of 2012 (the "JOBS Act") contains
provisions that, among other things, relax certain reporting requirements for
qualifying public companies. We qualify as an "emerging growth company" and
under the JOBS Act are allowed to comply with new or revised accounting
pronouncements based on the effective date for private (not publicly traded)
companies. We are electing to delay the adoption of new or revised accounting
standards, and as a result, we may not comply with new or revised accounting
standards on the relevant dates on which adoption of such standards is required
for
non-emerging
growth companies. As a result, the unaudited condensed financial statements may
not be comparable to companies that comply with new or revised accounting
pronouncements as of public company effective dates.
Additionally, we are in the process of evaluating the benefits of relying on the
other reduced reporting requirements provided by the JOBS Act. Subject to
certain conditions set forth in the JOBS Act, if, as an "emerging growth
company," we choose to rely on such exemptions we may not be required to, among
other things, (i) provide an auditor's attestation report on our system of
internal controls over financial reporting pursuant to Section 404, (ii) provide
all of the compensation disclosure that may be required of
non-emerging
growth public companies under the Dodd-Frank Wall Street Reform and Consumer
Protection Act, (iii) comply with any requirement that may be adopted by the
PCAOB regarding mandatory audit firm rotation or a supplement to the auditor's
report providing additional

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information about the audit and the financial statements (auditor discussion and
analysis) and (iv) disclose certain executive compensation related items such as
the correlation between executive compensation and performance and comparisons
of the CEO's compensation to median employee compensation. These exemptions will
apply for a period of five years following the completion of our Initial Public
Offering or until we are no longer an "emerging growth company," whichever is
earlier.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
We are a smaller reporting company as defined by Rule
12b-2
of the Exchange Act and are not required to provide the information otherwise
required under this item.
Item 4. Controls and Procedures
Disclosure controls and procedures are controls and other procedures designed to
ensure that information required to be disclosed in our reports filed or
submitted under the Exchange Act is recorded, processed, summarized, and
reported within the time periods specified in the SEC's rules and forms.
Disclosure controls and procedures include, without limitation, controls and
procedures designed to ensure that information required to be disclosed in our
reports filed or submitted under the Exchange Act is accumulated and
communicated to our management, including our Chief Executive Officer and Chief
Financial Officer, to allow timely decisions regarding required disclosure. Our
management evaluated, with the participation of our Chief Executive Officer and
Chief Financial Officer (our "Certifying Officers"), the effectiveness of our
disclosure controls and procedures as of September 30, 2021, pursuant to
Rule 13a-15(b) under
the Exchange Act. Based on their evaluation, our Certifying Officers have
concluded that, as of September 30, 2021, due to a material weakness that led to
the revision to our financial statements to account for the Company's Warrants
and Forward Purchase Agreement (restated and described in in our Quarterly
Report on Form
10-Q
for the fiscal quarter ended March 31, 2021), Working Capital Loan and Class A
common stock subject to possible redemption as described in Note 8, our
disclosure controls and procedures were not effective as of September 30, 2021.
In light of this material weakness, we performed an additional analysis to
ensure that our financial statements were prepared in accordance with U.S.
generally accepted accounting principles. Accordingly, management believes that
the financial statements included in this Quarterly Report on
Form 10-Q
present fairly in all material respects our financial position, results of
operations and cash flows for the period presented.
Disclosure controls and procedures are designed to ensure that information
required to be disclosed by us in our Exchange Act reports is recorded,
processed, summarized, and reported within the time periods specified in the
SEC's rules and forms, and that such information is accumulated and communicated
to our management, including our principal executive officer and principal
financial officer or persons performing similar functions, as appropriate to
allow timely decisions regarding required disclosure.
Evaluation of Disclosure Controls and Procedures
In connection with the revision on specific line items in previously issued
unaudited financial statement for the quarter ended March 31, 2021, filed on
Form
10-Q
on May 24, 2021, our management reassessed the effectiveness of our disclosure
controls and procedures as of September 30, 2021. As a result of that
reassessment, our management determined that our disclosure controls and
procedures as of September 30, 2021 were not effective solely as a result of a
misstatement in the misapplication of accounting guidance related to our funded
working capital loan and the initial recognition of the shares subject to
redemption.
In light of the material weakness that we identified, we performed additional
analysis as deemed necessary to ensure that our unaudited condensed financial
statements for the quarter ended September 30, 2021, were prepared in accordance
with U.S. generally accepted accounting principles. Accordingly, management
believes that the unaudited condensed financial statements included in this
Quarterly Report on Form
10-Q
present fairly in all material respects our financial position, results of
operations and cash flows for the period presented.
Changes in Internal Control over Financial Reporting
Other than as described herein, there were no changes in our internal control
over financial reporting (as such term is defined in Rules
13a-15(f)
and
15d-15(f)
under the Exchange Act) during the most recent fiscal quarter that have
materially affected, or are reasonably likely to materially affect, our internal
control over financial reporting, as the circumstances that led to the revision
of our previously filed financial statements described above had not yet been
identified.

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Table of Contents In light of the revision of the previously filed financial statements, we plan to enhance our processes to identify and appropriately apply applicable accounting requirements to better evaluate and understand the nuances of the complex accounting standards that apply to our financial statements. Our plans at this time include providing enhanced access to accounting literature, research materials and documents and increased communication among our personnel and third-party professionals with whom we consult regarding complex accounting applications. The elements of our remediation plan can only be accomplished over time, and we can offer no assurance that these initiatives will ultimately have the intended effects.

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