aac-20220630

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 June 30, 2022


☐			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. 001-39972

ARES ACQUISITION CORPORATION

(Exact name of Registrant as specified in its charter)


Cayman Islands	001-39972	98-1538872
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification Number)

245 Park Avenue, 44th Floor, New York, NY 10167

(Address of principal executive office) (Zip Code)

(310) 201-4100

(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 Class A Ordinary Share, $0.0001 par value, and one fifth of one redeemable warrant

AAC.U

New York Stock Exchange

Class A Ordinary Shares included as part of the units

AAC

New York Stock Exchange

Redeemable warrants, included as part of the units, each whole warrant exercisable for one Class A Ordinary Share at an exercise price of $11.50

AAC 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 x 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 x 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 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 9, 2022, 100,000,000 Class A ordinary shares, par value $0.0001, and 25,000,000 Class B ordinary shares, par value $0.0001, were issued and outstanding.

ARES ACQUISITION CORPORATION

Quarterly Report on Form 10-Q

Table of Contents



						Page
PART I—FINANCIAL INFORMATION
Item 1. Unaudited Condensed Financial Statements						1
Condensed Balance Sheets as of June 30, 2022 (unaudited) and December 31, 2021						1
Unaudited Condensed Statements of Operations for the three and six months ended June 30, 2022 and 2021						2
Unaudited Condensed Statements of Changes in Shareholders’ Deficit for the three and six months ended June 30, 2022 and 2021						3
Unaudited Condensed Statements of Cash Flows for the six months ended June 3 0 , 2022 and 2021						4
Notes to Unaudited Condensed Financial Statements						5
Item 2. Management’s Discussion And Analysis Of Financial Condition And Results Of Operations						19
Item 3. Quantitative and Qualitative Disclosures about Market Risk						23
Item 4. Controls And Procedures						23
PART II—OTHER INFORMATION
Item 1. Legal Proceedings						24
Item 1A. Risk Factors						24
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds from Registered Securities						24
Item 3. Defaults Upon Senior Securities						25
Item 4. Mine Safety Disclosure						25
Item 5. Other Information						25
Item 6. Exhibits						25
Signatures						26


	As of June 30,		As of December 31,
	2022		2021
	(Unaudited)

Assets
Current assets:
Cash	$	282,121	$	749,510
Prepaid expenses	345,489		536,382

Total current assets	627,610		1,285,892
Investments held in Trust Account	1,000,489,927		1,000,284,779
Total assets	$	1,001,117,537	$	1,001,570,671

Liabilities and shareholders’ deficit
Current liabilities
Accrued expenses	$	2,076,506	$	3,476,416
Accrued expenses - related party	56,690		46,900
Working capital loan	1,500,000		—
Total current liabilities	3,633,196		3,523,316
Warrant liabilities	8,138,234		31,704,522
Deferred underwriting commissions	35,000,000		35,000,000
Total liabilities	46,771,430		70,227,838

Commitments and contingencies
Class A ordinary shares, $0.0001 par value; 100,000,000 shares subject to possible redemption at $10.00 per share at June 30, 2022 and December 31, 2021	1,000,000,000		1,000,000,000

Shareholders’ deficit
Preference shares, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding	—		—
Class A ordinary shares, $0.0001 par value; 300,000,000 shares authorized at June 30, 2022 and December 31, 2021	—		—
Class B ordinary shares, $0.0001 par value; 30,000,000 shares authorized; 25,000,000 shares issued and outstanding at June 30, 2022 and December 31, 2021	2,500		2,500

Accumulated deficit	(45,656,393)		(68,659,667)
Total shareholders’ deficit	(45,653,893)		(68,657,167)
Total liabilities and shareholders’ deficit	$	1,001,117,537	$	1,001,570,671


	For the three months ended June 30,				For the six months ended June 30,
	2022		2021		2022		2021

General and administrative expenses	$	354,645	$	315,129	$	768,162	$	2,667,769
Loss from operations	(354,645)		(315,129)		(768,162)		(2,667,769)
Other income (expense):
Investment income (loss) on investments held in Trust Account	(125,371)		16,776		205,148		57,155
Offering costs associated with warrants recorded as liabilities	—		(2,870)		—		(1,677,518)
Change in fair value of warrant liabilities	6,420,134		(13,749,024)		23,566,288		10,618,389
Total other income (expense)	6,294,763		(13,735,118)		23,771,436		8,998,026
Net income (loss)	$	5,940,118	$	(14,050,247)	$	23,003,274	$	6,330,257

Basic and diluted weighted average shares outstanding of Class A ordinary shares	100,000,000		100,000,000		100,000,000		100,000,000
Basic and diluted net income (loss) per share, Class A ordinary shares	$	0.05	$	(0.11)	$	0.18	$	0.05
Basic and diluted weighted average shares outstanding of Class B ordinary shares	25,000,000		25,000,000		25,000,000		25,000,000
Basic and diluted net income (loss) per share, Class B ordinary shares	$	0.05	$	(0.11)	$	0.18	$	0.05


		For the three and six months ended June 30, 2022
		Ordinary Shares			Additional Paid-in Capital		Accumulated Deficit		Total Shareholders’ Deficit
	Class B
		Shares	Amount
Balance at December 31, 2021		25,000,000	$	2,500	$	—	$	(68,659,667)	$	(68,657,167)


Net income		—	—		—		17,063,156		17,063,156
Balance at March 31, 2022		25,000,000	2,500		—		(51,596,511)		(51,594,011)


Net income		—	—		—		5,940,118		5,940,118
Balance at June 30, 2022		25,000,000	$	2,500	$	—	$	(45,656,393)	$	(45,653,893)


Gross proceeds	$	1,000,000,000
Less:
Proceeds allocated to Public Warrants	(30,261,819)
Class A ordinary shares issuance costs	(54,255,575)
Plus:
Accretion of carrying value to redemption value	84,517,394
Class A ordinary shares subject to possible redemption	$	1,000,000,000


Description	Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)
As of June 30, 2022:
Assets, at fair value
Investments held in Trust Account:	$	1,000,489,927	$	—	$	—
Liabilities, at fair value
Public Warrants	$	4,606,000	$	—	$	—
Private Placement Warrants	$	—	$	—	$	3,532,234

Description	Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)
As of December 31, 2021:
Assets, at fair value
Investments held in Trust Account:	$	1,000,284,779	$	—	$	—
Liabilities, at fair value
Public Warrants	$	17,822,000	$	—	$	—
Private Placement Warrants	$	—	$	—	$	13,882,522


	As of June 30, 2022			As of December 31, 2021
Exercise price	$	11.50		$	11.50
Share price	$	9.84		$	9.74
Term (in years)	5.00			5.00
Volatility	2.91		%	15.00		%
Risk-free interest rate	3.01		%	1.26		%


Warrant liabilities at December 31, 2021	$	13,882,522


Change in fair value recognized in earnings	(7,564,154)
Warrant liabilities at March 31, 2022	6,318,368
Change in fair value recognized in earnings	(2,786,134)
Warrant liabilities at June 30, 2022	$	3,532,234

Warrant liabilities at December 31, 2020	$	—
Issuance of Public and Private Placement Warrants	55,407,948
Transfer of Public Warrants to Level 1	(17,500,000)
Change in fair value recognized in earnings	(24,367,413)
Warrant liabilities at March 31, 2021	13,540,535
Change in fair value recognized in earnings	6,249,024
Warrant liabilities at June 30, 2021	$	19,789,559


Exhibit No.						Description
31.1*						Certification of Chief Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*						Certification of Chief Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*						Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*						Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*						XBRL Instance Document
101.SCH*						XBRL Taxonomy Extension Schema Document
101.CAL*						XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*						XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*						XBRL Taxonomy Extension Labels Linkbase Document
101.PRE*						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.


	ARES ACQUISITION CORPORATION


Dated: August 10, 2022		By:	/s/ David B. Kaplan
		Name:	David B. Kaplan
		Title:	Chief Executive Officer and Co-Chairman

Dated: August 10, 2022		By:	/s/ Jarrod Phillips

SEC Form 10-Q filed by Ares Acquisition Corporation