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, 2021

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

For the transition period from to

Qell Acquisition Corp.

(Exact name of registrant as specified in its charter)

Cayman Islands		001-39571		98-1554553
(State or other jurisdiction of incorporation or organization)		(Commission File Number)		(I.R.S. Employer Identification Number)



505 Montgomery Street, Suite 1100 San Francisco, CA		94111
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (415) 874-3000

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 share of Class A ordinary shares, and one Warrant to acquire one-third Class A ordinary share	QELLU	Nasdaq Capital Market
Class A ordinary share, par value $0.0001 per share	QELL	Nasdaq Capital Market
Warrants, each whole warrant exercisable for one Class A ordinary share at an exercise price of $11.50	QELLW	Nasdaq Capital Market

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.


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 11, 2021, 4,325,183 Units, 33,624,817 Class A ordinary shares, par value $0.0001 per share, and 9,487,500 Class B ordinary shares, par value $0.0001 per share, and 18,268,226 Warrants were issued and outstanding, respectively.


		Page
PART I. FINANCIAL INFORMATION
Item 1.	Condensed Financial Statements (Unaudited)	1
	Condensed Balance Sheets as of June 30, 2021 (Unaudited) and December 31, 2020	1
	Unaudited Condensed Statements of Operations for the three and six months ended June 30, 2021	2
	Unaudited Condensed Statements of Changes in Shareholders’ Equity for the three and six months ended June 30, 2021	3
	Unaudited Condensed Statement of Cash Flows for the six months ended June 30, 2021	4
	Notes to Unaudited Condensed Financial Statements	5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	25
Item 4.	Controls and Procedures	25
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	25
Item 1A.	Risk Factors	25
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds from Registered Securities	25
Item 3.	Defaults Upon Senior Securities	26
Item 4.	Mine Safety Disclosures	26
Item 5.	Other Information	26
Item 6.	Exhibits	27
SIGNATURES		28


	June 30, 2021		December 31, 2020
	(Unaudited)
Assets
Current assets:
Cash	$	337,744	$	2,023,823
Prepaid expenses		390,307		515,078
Due from related party		87,365		—
Total current assets		815,416		2,538,901
Investments held in Trust Account		379,656,050		379,579,492
Total Assets	$	380,471,466	$	382,118,393

Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable	$	342,203	$	133,528
Accrued expenses		4,993,894		80,000
Total current liabilities		5,336,097		213,528
Derivative warrant liabilities		31,536,000		61,495,200
Deferred underwriting commissions		13,282,500		13,282,500
Total liabilities		50,154,597		74,991,228

Commitments and Contingencies (Note 5)
Class A ordinary shares subject to possible redemption; 32,531,686 and 30,212,716 shares at $10.00 per share as of June 30, 2021 and December 31,2020, respectively		325,316,860		302,127,160

Shareholders' Equity:
Preference shares, $0.0001 par value; 1,000,000 shares authorized; none issued or outstanding		—		—
Class A ordinary shares, $0.0001 par value; 200,000,000 shares authorized; 5,418,314 and 7,737,284 shares issued and outstanding (excluding 32,531,686 and 30,212,716 shares subject to possible redemption) as of June 30, 2021 and December 31, 2020, respectively		542		774
Class B ordinary shares, $0.0001 par value; 20,000,000 shares authorized; 9,487,500 shares issued and outstanding as of June 30, 2021 and December 31, 2020		949		949
Additional paid-in capital		16,805,356		39,994,824
Accumulated deficit		(11,806,838)		(34,996,542)
Total shareholders' equity		5,000,009		5,000,005
Total Liabilities and Shareholders' Equity	$	380,471,466	$	382,118,393


	For the Three Months		For the Six Months
	Ended June 30, 2021		Ended June 30, 2021

Operating expenses:
General and administrative expenses	$	2,695,836	$	6,683,419
Administrative fee - related party		84,677		162,635
Loss from operations		(2,780,513)		(6,846,054)

Other income:
Change in fair value of derivative warrant liabilities		2,365,200		29,959,200
Income earned on investments held in Trust Account		13,570		76,558
Net income (loss)	$	(401,743)	$	23,189,704

Basic and diluted weighted average shares outstanding of Class A ordinary shares		37,950,000		37,950,000
Basic and diluted net income per ordinary share, Class A	$	0.00	$	0.00
Basic and diluted weighted average shares outstanding of Class B ordinary shares		9,487,500		9,487,500
Basic and diluted net income (loss) per ordinary share, Class B	$	(0.04)	$	2.44


	Ordinary Shares										Total
	Class A			Class B			Additional Paid-In		Retained Earnings		Shareholders'
	Shares	Amount		Shares	Amount		Capital		(Accumulated Deficit)		Equity
Balance - December 31, 2020	7,737,284	$	774	9,487,500	$	949	$	39,994,824	$	(34,996,542)	$	5,000,005
Class A ordinary Shares subject to possible redemption	(2,359,145)		(236)	—		—		(23,591,214)		—		(23,591,450)
Net income	—		—	—		—		—		23,591,447		23,591,447
Balance - March 31, 2021 (unaudited)	5,378,139		538	9,487,500		949		16,403,610		(11,405,095)		5,000,002
Class A ordinary Shares subject to possible redemption	40,175		4	—		—		401,746		—		401,750
Net loss	—		—	—		—		—		(401,743)		(401,743)
Balance - June 30, 2021 (unaudited)	5,418,314	$	542	9,487,500	$	949	$	16,805,356	$	(11,806,838)	$	5,000,009


Cash Flows from Operating Activities:
Net income	$	23,189,704
Adjustments to reconcile net income to net cash used in operating activities:
Income earned on investments in Trust Account		(76,558)
Change in fair value of derivative warrant liabilities		(29,959,200)
Changes in operating assets and liabilities:
Prepaid expenses		124,771
Due from related party		(87,365)
Accounts payable		208,675
Accrued expenses		4,913,894
Net cash used in operating activities		(1,686,079)

Net decrease in cash		(1,686,079)

Cash - beginning of the period:		2,023,823
Cash - end of the period	$	337,744

Supplemental disclosure of non-cash investing and financing activities:
Change in initial value of Class A ordinary shares subject to possible redemption	$	23,189,700


	Fair Value Measured as of June 30, 2021
	Level 1		Level 2		Level 3		Total
Assets
Investments held in Trust Account - Money market mutual fund	$	379,656,050	$	—	$	—	$	379,656,050
Liabilities:
Derivative warrant liabilities - Public warrants		20,240,000		—		—		20,240,000
Derivative warrant liabilities - Private warrants		—		11,296,000		—		11,296,000
Total fair value	$	399,896,050	$	11,296,000	$	—	$	411,192,050


	Fair Value Measured as of December 31, 2020
	Level 1		Level 2		Level 3		Total
Assets
Investments held in Trust Account -U.S. Treasury Securities	$	379,579,492	$	—	$	—	$	379,579,492
Liabilities:
Derivative warrant liabilities - Public warrants		39,468,000		—		—		39,468,000
Derivative warrant liabilities - Private warrants		—		—		22,027,200		22,027,200
Total fair value	$	419,047,492	$	—	$	22,027,200	$	441,074,692


Exhibit Number		Description
10.1		Amendment No. 1, dated as of July 14, 2021, to Business Combination Agreement, by and among Qell Acquisition Corp., Lilium GmbH, Lilium B.V. and Queen Cayman Merger LLC (incorporated by reference to Exhibit 2.2 of the registration statement on Form F-4/A filed by Lilium B.V. on July 14, 2021).(1)
31.1*		Certification of Chief Executive Officer (Principal 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 (Principal Financial and Accounting 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 (Principal 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 (Principal Financial and Accounting Officer) Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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 Label Linkbase Document
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)


Dated: August 16, 2021	QELL ACQUISITION CORP.

	By:	/s/ Barry Engle
	Name:	Barry Engle
	Title:	Chief Executive Officer (Principal Executive Officer)

Dated: August 16, 2021

	By:	/s/ Sam Gabbita
	Name:	Sam Gabbita
	Title:	Chief Financial Officer (Principal Financial and Accounting Officer)

SEC Form 10-Q filed by Qell Acquisition Corp.