fvt-20210930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q/A

AMENDMENT NO. 1

(Mark One)

☒ 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 to

Commission File Number: 001-39839

FORTRESS VALUE ACQUISITION CORP. III

(Exact name of registrant as specified in its charter)


Delaware						85-2761402
(State or other jurisdiction of incorporation						(I.R.S. Employer Identification No.)
or organization)

1345 Avenue of the Americas, New York, NY 10105

(Address of principal executive offices) (Zip Code)

(212) 798-6100

(Registrant’s telephone number, including area code)

Not Applicable

(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
Symbols

Name of each exchange
on which registered

Units, each consisting of one share of Class A common stock and one-fifth of one redeemable warrant

FVT.U

New York Stock Exchange

Class A common stock, par value $0.0001 per share

FVT

New York Stock Exchange

Redeemable warrants, each whole warrant exercisable for one share of Class A common stock at an exercise price of $11.50 per share

FVT 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, 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 December 13, 2021, 23,000,000 shares of Class A common stock, par value $0.0001 per share and 5,750,000 shares of Class F common stock, par value $0.0001 per share, were issued and outstanding, respectively.

EXPLANATORY NOTE

Fortress Value Acquisition Corp. III (the “Company”) is filing this Amendment No. 1 on Form 10-Q/A (the “10-Q/A”) to amend and restate certain items in the Company’s Quarterly Report on Form 10-Q as of September 30, 2021 and for the three and nine months ended September 30, 2021 (the “Original 10-Q”), originally filed with the Securities and Exchange Commission (the “SEC”) on November 4, 2021.

In connection with Company’s Original 10-Q, the Company re-evaluated the accounting for its Class A common stock subject to possible redemption as temporary equity. In accordance with the SEC and its staff’s guidance on redeemable equity instruments, which has been codified in Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 480, “Distinguishing Liabilities from Equity” (“ASC 480”), paragraph 10-S99-3A, redemption provisions not solely within the control of the Company require common stock subject to redemption to be classified outside of permanent equity. The Company had previously classified a portion of its Class A common stock subject to possible redemption in permanent equity. Although the Company did not specify a maximum redemption threshold, its amended and restated certificate of incorporation provides that the Company will not redeem its public shares in an amount that will cause its net tangible assets to be less than $5,000,001. Upon re-evaluation, the Company determined that the Class A common stock includes certain provisions that require classification of the Class A common stock as temporary equity regardless of the minimum net tangible assets threshold. As a result, in connection with the Original 10-Q, the Company classified all of its Class A common stock as temporary equity as of September 30, 2021 and adjusted its initial book value to redemption value in accordance with ASC 480. In connection with the change in presentation for the Class A common stock subject to possible redemption, the Company also restated its earnings per share calculation to allocate net income (loss) pro-rata to Class A and Class F common stock.

As of the time of the filing of the Company’s Original 10-Q, the Company did not restate its previously filed financial statements for June 30, 2021 and March 31, 2021 on Form 10-Q filed with the SEC on August 9, 2021 and May 12, 2021, respectively.

On December 1, 2021, management of the Company and the Audit Committee of the Board of Directors of the Company (the “Audit Committee”) determined that it is appropriate to restate the Company’s previously issued quarterly unaudited financial statements for the three and nine months ended September 30, 2021, for the three and six months ended June 30, 2021 and for the three months ended March 31, 2021. Such previously filed financial statements should no longer be relied upon.

The change in accounting for Class A common stock subject to possible redemption as temporary equity and the change in the Company’s earnings per share calculation did not have any impact on the Company’s total assets, liabilities, operating results or liquidity in any of the periods included in Item 1. Condensed Financial Statements in this filing.

In connection with the restatement, the Company’s management reassessed the effectiveness of its disclosure controls and procedures as of September 30, 2021. As a result of that reassessment, the Company’s management determined that its disclosure controls and procedures as of September 30, 2021 were not effective due to a material weakness in internal control over financial reporting relating to the accounting for complex financial instruments. For more information, see Item 4 included in this 10-Q/A.

The Company has not amended its June 30, 2021 or March 31, 2021 Quarterly Report on Form 10-Q for the periods affected by the restatement. The financial information that has been previously filed or otherwise reported for these periods is superseded by the information in this 10-Q/A.

The restatement is more fully described in Note 2 of the notes to the financial statements included herein.

Items Amended

The following items are amended in this Amendment: (i) Part I, Item I. Condensed Financial Statements; (ii) Part I, Item 4. Controls and Procedures and (iii) Part II, Item 1A. Risk Factors. Additionally, in accordance with Rule 12b-15 under the Securities Exchange Act of 1934, as amended, the Company is including with this 10-Q/A currently dated certifications from our principal executive officer and principal financial officer. These certifications are filed or furnished, as applicable, as Exhibits 31.1, 31.2, 32.1 and 32.2.

Except as described above, this 10-Q/A does not amend, update or change any other items or disclosures contained in the Original 10-Q, and accordingly, this 10-Q/A does not reflect or purport to reflect any information or events occurring after the original filing date or modify or update those disclosures affected by subsequent events. Accordingly, this 10-Q/A should be read in conjunction with the Original 10-Q and the Company’s other filings with the SEC. Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Original 10-Q.

Fortress Value Acquisition Corp. III

QUARTERLY REPORT ON FORM 10-Q/A

Table of Contents

PAGE

PART I. FINANCIAL INFORMATION

Item 1.

Condensed Financial Statements

Condensed Balance Sheets as of September 30, 2021 (Unaudited) and

December 31, 2020

Condensed Statements of Operations for the three and nine months ended

September 30, 2021 and for the period from August 28, 2020 (inception)

through September 30, 2020 (Unaudited)

Condensed Statements of Changes in Stockholders’ Equity for the three and nine

months ended September 30, 2021 and for the period from August

28, 2020 (inception) through September 30, 2020 (Unaudited)

Condensed Statement of Cash Flows for the nine months ended September
30, 2021 and for the period from August 28, 2020 (inception) through
September 30, 2020 (Unaudited)

Notes to Unaudited Condensed Financial Statements

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of
Operations

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Item 4.

Controls and Procedures

PART II. OTHER INFORMATION

Item 1.

Legal Proceedings

Item 1A.

Risk Factors

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

Item 3.

Defaults Upon Senior Securities

Item 4.

Mine Safety Disclosures

Item 5.

Other Information

Item 6.

Exhibits

PART I. FINANCIAL INFORMATION

Item 1. Condensed Financial Statements

FORTRESS VALUE ACQUISITION CORP. III

CONDENSED BALANCE SHEETS


	September 30, 2021 (Unaudited)		December 31, 2020
Assets:
Current assets:
Cash	$	323,244	$	5,328
Prepaid expenses	530,737		—
Total current assets	853,981		5,328
Investments held in Trust Account	230,021,750		—
Deferred offering costs	—		364,614
Total Assets	$	230,875,731	$	369,942

Liabilities and Stockholders’ Equity:
Current liabilities:
Accounts payable and accrued expenses	$	3,185,044	$	303,691
Note payable - related party	—		61,000
Franchise tax payable	149,589		—
Total current liabilities	3,334,633		364,691
Deferred underwriting commissions payable	8,050,000		—
Warrant liabilities	10,672,000		—
Total Liabilities	22,056,633		364,691

Commitments and Contingencies

Class A common stock subject to possible redemption; 23,000,000 shares and no shares issued and outstanding at redemption value as of September 30, 2021 and December 31, 2020, respectively	230,000,000		—

Stockholders’ Equity:
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; no shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively	—		—
Class A common stock, $0.0001 par value; 500,000,000 and 200,000,000 shares authorized as of September 30, 2021 and December 31, 2020, respectively	—		—
Class F common stock, $0.0001 par value; 50,000,000 and 20,000,000 shares authorized as of September 30, 2021 and December 31, 2020, respectively; 5,750,000 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively	575		575
Additional paid-in capital	—		24,425
Accumulated deficit	(21,181,477)			(19,749)
Total Stockholders’ Equity	(21,180,902)			5,251
Total Liabilities and Stockholders’ Equity	$	230,875,731	$	369,942

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

FORTRESS VALUE ACQUISITION CORP. III

CONDENSED STATEMENTS OF OPERATIONS

(Unaudited)


	For the three months ended September 30, 2021		For the nine months ended September 30, 2021		For the period from August 28, 2020 (inception) through September 30, 2020
General and administrative expenses	$	307,395	$	4,793,265	$	17,217
Franchise tax expense	50,411		149,589		—
Loss from operations	(357,806)		(4,942,854)		(17,217)

Other income (loss):
Interest income		2,960		21,750		—
Decrease in fair value of warrant liabilities	3,664,000		7,574,721			—
Fair value in excess of cash received for Private Placement Warrants	—		(2,396,195)			—
Offering costs related to warrant liabilities	—		(495,479)			—
Total other income (loss)	3,666,960		4,704,797		—

Net income (loss)	$	3,309,154	$	(238,057)	$	(17,217)

Weighted average shares outstanding, Class A common stock	23,000,000		23,000,000
Basic and diluted net income (loss) per share, Class A common stock	$	0.12	$	(0.01)

Weighted average shares outstanding, Class F common stock	5,750,000		5,733,516		5,000,000
Basic and diluted net income (loss) per share, Class F common stock	$	0.12	$	(0.01)	$	(0.00)

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

FORTRESS VALUE ACQUISITION CORP. III

CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(Unaudited)


	For the three and nine months ended September 30, 2021
	Common stock							Additional Paid-In Capital		Accumulated Deficit		Total Stockholders’ Equity
	Class A				Class F
	Shares		Amount		Shares	Amount
Balance - December 31, 2020	—		$	—	5,750,000	$	575	$	24,425	$	(19,749)	$	5,251
Remeasurement of Class A common stock subject to possible redemption to redemption value (As Restated - see Note 2)		—		—	—	—			(24,425)	(20,923,671)			(20,948,096)
Net loss	—		—		—	—		—			(2,100,614)	(2,100,614)
Balance - March 31, 2021 (As Restated - see Note 2)	—		$	—	5,750,000	$	575	$	—	$	(23,044,034)	$	(23,043,459)
Net loss	—			—	—	—		—		(1,446,597)		(1,446,597)
Balance - June 30, 2021 (As Restated - see Note 2)	—		$	—	5,750,000	$	575	$	—	$	(24,490,631)	$	(24,490,056)
Net income	—			—	—	—		—		3,309,154		3,309,154
Balance - September 30, 2021	—		$	—	5,750,000	$	575	$	—	$	(21,181,477)	$	(21,180,902)


	For the period from August 28, 2020 (inception) through September 30, 2020
	Common stock							Additional Paid-In Capital		Accumulated Deficit		Total Stockholders’ Equity
	Class A				Class F
	Shares		Amount		Shares	Amount
Balance - August 28, 2020 (inception)	—		$	—	—	$	—	$	—	$	—	$	—
Issuance of Class F common stock to Sponsor		—		—	5,750,000	575			24,425	—			25,000
Net loss	—		—		—	—		—			(17,217)	(17,217)
Balance - September 30, 2020	—		$	—	5,750,000	$	575	$	24,425	$	(17,217)	$	7,783

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

FORTRESS VALUE ACQUISITION CORP. III

CONDENSED STATEMENT OF CASH FLOWS

(Unaudited)


	For the nine months ended September 30, 2021		For the period from August 28, 2020 (inception) through September 30, 2020
Cash Flows from Operating Activities:
Net loss	$	(238,057)	$	(17,217)
Adjustments to reconcile net loss to net cash used in operating activities:
Interest income from investments held in Trust Account	(21,750)		—
Decrease in fair value of warrant liabilities	(7,574,721)		—
Fair value in excess of cash received for Private Placement Warrants	2,396,195		—
Offering costs related to warrant liabilities	495,479		—
Changes in operating assets and liabilities:
Prepaid expenses	(530,737)		—
Accounts payable and accrued expenses	2,824,968		17,217
Franchise tax payable	149,589		—
Net cash used in operating activities	(2,499,034)		—

Cash Flows from Investing Activities:
Cash deposited in Trust Account	(230,000,000)		—
Net cash used in investing activities	(230,000,000)		—

Cash Flows from Financing Activities:
Proceeds from issuance of Class F common stock to Sponsor	—		25,000
Repayment of Sponsor loan	(61,000)		—
Proceeds received from Initial Public Offering of Units, net of underwriting commissions paid	225,400,000		—
Payment of offering costs	(122,050)		—
Proceeds received from issuance of Private Placement Warrants	7,600,000		—
Net cash provided by financing activities	232,816,950		25,000

Net change in cash	317,916		25,000
Cash - beginning of the period	5,328		—
Cash - end of the period	$	323,244	$	25,000

Supplemental disclosure of non-cash financing activities:
Deferred underwriting commissions payable in connection with the Initial Public Offering	$	8,050,000	$	—

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

FORTRESS VALUE ACQUISITION CORP. III

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

1. Description of Organization and Business Operations

Fortress Value Acquisition Corp. III (the “Company”) is a blank check company incorporated in Delaware on August 28, 2020. The Company was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (“Business Combination”). Although the Company is not limited to a particular industry or geographic region for purposes of consummating a Business Combination, the Company intends to capitalize on the ability of its management team to identify, acquire and operate a business that may provide opportunities for attractive risk-adjusted returns. The Company is an emerging growth company and, as such, the Company is subject to all of the risks associated with emerging growth companies.

All activity from August 28, 2020 (inception) through September 30, 2021 relates to the Company’s formation, the completion of the initial public offering (the “Initial Public Offering”) and, since the closing of the Initial Public Offering, the search for a Business Combination candidate. The Company will not generate any operating revenues until after the completion of a Business Combination, at the earliest. The Company generates non-operating income in the form of interest income from the proceeds derived from the Initial Public Offering.

The registration statement for the Company’s Initial Public Offering was declared effective on January 4, 2021. On January 7, 2021, the Company consummated its Initial Public Offering of 23,000,000 units (“Units” and, with respect to the Class A common stock included in the Units being offered, the “Public Shares”), which included the issuance of 3,000,000 Units as a result of the underwriters’ exercise of their over-allotment option in full, at $10.00 per Unit, generating gross proceeds of $230,000,000 and incurring offering costs of $13,193,049, inclusive of $8,050,000 in deferred underwriting commissions (see Note 5). Each Unit consists of one share of Class A common stock and one-fifth of one redeemable warrant (“Public Warrant”). Each whole Public Warrant entitles the holder to purchase one share of Class A common stock at an exercise price of $11.50 per share, subject to adjustment (see Note 6).

Substantially concurrently with the closing of the Initial Public Offering, the Company consummated a private placement (“Private Placement”) of 5,066,667 warrants (the “Private Placement Warrants” and together with the “Public Warrants”, the “Warrants”), at a price of $1.50 per Private Placement Warrant, with the Company’s sponsor, Fortress Acquisition Sponsor III LLC (the “Sponsor”), generating gross proceeds of $7,600,000 (see Note 4). The Private Placement Warrants had an estimated fair value of $9,996,195 as of the closing of the Initial Public Offering, resulting in a $2,396,195 non-cash loss to the Company equal to the fair value in excess of cash received for the Private Placement Warrants.

FORTRESS VALUE ACQUISITION CORP. III

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

Upon the closing of the Initial Public Offering and Private Placement, $230,000,000 ($10.00 per Unit) of the aggregate net cash proceeds of the sale of the Units in the Initial Public Offering and the Private Placement was placed in a U.S.-based trust account (the “Trust Account”) maintained by Continental Stock Transfer & Trust Company, acting as trustee. The cash proceeds held in the Trust Account were subsequently invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended, (“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 certain conditions 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 funds held in the Trust Account as described below.

As of September 30, 2021, the Company had $323,244 in cash held outside of the Trust Account. 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’s initial Business Combination must be with one or more operating businesses or assets with a fair market value equal to at least 80% of the assets held in the Trust Account (net of amounts disbursed to management for working capital purposes, if any, and excluding the amount of any deferred underwriting discount held in trust) at the time of the Company signing a definitive agreement in connection with its 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.

FORTRESS VALUE ACQUISITION CORP. III

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

The Company will provide its stockholders of Public Shares (“Public Stockholders”) 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 stockholder meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek stockholder approval of a Business Combination or conduct a tender offer will be made by the Company. If, however, stockholder approval of the transaction is required by applicable law or stock exchange listing requirement, or the Company decides to obtain stockholder approval for business or other reasons, it will: (i) conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and (ii) file proxy materials with the Securities and Exchange Commission (“SEC”). The Public Stockholders will be entitled to redeem their Public Shares for a pro-rata portion of the amount in the Trust Account (approximately $10.00 per share as of September 30, 2021), plus any pro-rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay for the Company’s tax obligations, calculated as of two business days prior to the consummation of the Business Combination. The per-share amount to be distributed to Public Stockholders 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). The Company’s amended and restated certificate of incorporation provides that in no event will the Company redeem its Public Shares in an amount that would cause its net tangible assets to be less than $5,000,001 upon consummation of the initial business combination and after payment of the deferred underwriting commissions. 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 stockholder vote is not required by applicable law or stock exchange listing requirements and the Company does not decide to hold a stockholder vote for business or other reasons, the Company will, pursuant to its amended and restated certificate of incorporation, conduct the redemptions pursuant to the tender offer rules of the SEC, and file tender offer documents with the SEC prior to completing a Business Combination. Additionally, each Public Stockholder may elect to redeem their Public Shares without voting, and if they do vote, irrespective of whether they vote for or against the proposed transaction. If the Company seeks stockholder approval in connection with a Business Combination, the initial stockholders (as defined below) have agreed to vote their Founder Shares (as defined in Note 4) and any Public Shares purchased during or after the Initial Public Offering in favor of a Business Combination. In addition, the initial stockholders have 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 Company’s amended and restated certificate of incorporation provides that a Public Stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 of 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 common stock sold in the Initial Public Offering, without the prior consent of the Company.

FORTRESS VALUE ACQUISITION CORP. III

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

The Company’s Sponsor, officers and directors (the “initial stockholders”) have agreed not to propose an amendment to the Company’s amended and restated certificate of incorporation that would affect 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 Stockholders with the opportunity to redeem their Class A common stock in conjunction with any such amendment.

If the Company is unable to complete a Business Combination within 24 months (January 2023) from the closing of the Initial Public Offering (the “Combination Period”), the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but no more than ten business days thereafter, redeem 100% of the outstanding Public Shares which redemption will completely extinguish Public Stockholders’ rights as stockholders (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 stockholder and the Company’s board of directors, proceed to commence a voluntary liquidation and thereby a formal dissolution of the Company, subject in each case to its obligations to provide for claims of creditors and the requirements of applicable law.

In connection with the redemption of 100% of the Company’s outstanding Public Shares for a portion of the funds held in the Trust Account, each holder will receive a full pro-rata portion of the amount then in the Trust Account, plus any pro-rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its taxes (less up to $100,000 of interest to pay dissolution expenses).

The initial stockholders have 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 initial stockholders should 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 have agreed to waive their rights to their deferred underwriting commissions (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 funds held in the Trust Account that will be available to fund the redemption of the Company’s Public Shares.

FORTRESS VALUE ACQUISITION CORP. III

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

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 (or less than that in certain circumstances). In order to protect the amounts held in the Trust Account, the Sponsor has agreed to be liable to the Company, if and to the extent any claims by a third party 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 third parties, service providers (other than the Company’s 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 and capital resources

As of September 30, 2021, the Company had $323,244 in its operating bank account, $21,750 of interest income available in the Trust Account to pay for taxes and working capital deficit of $2,480,652. In order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”) (see Note 4). In connection with the Company’s assessment of going concern considerations in accordance with Accounting Standards Update (“ASU”) 2014-15, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” as of September 30, 2021 the Company does not have sufficient liquidity to meet its current obligations. However, management has determined that the Company has access to funds from the Sponsor, and the Sponsor has the financial wherewithal to fund the Company, that are sufficient to fund the working capital needs of the Company until the earlier of the consummation of a Business Combination and a minimum of one year from the date of issuance of these unaudited condensed financial statements. Over this time period, the Company will be using these funds for paying existing accounts payable and accrued expenses.

Separate trading of Class A common shares and Public Warrants

On February 22, 2021, the Company announced that, commencing February 25, 2021, the holders of the Company’s Units may elect to separately trade the Class A common stock and Public Warrants comprising the Units. No fractional warrants will be issued upon separation of the Units and only whole warrants will trade. Those Units not separated will continue to trade on the New York Stock Exchange under the symbol “FVT.U,” and each of the shares of Class A common stock and Public Warrants that are separated will trade on the New York Stock Exchange under the symbols “FVT” and “FVT WS,” respectively.

FORTRESS VALUE ACQUISITION CORP. III

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

COVID-19

An outbreak of respiratory disease which caused a global pandemic continues to impact global markets. This coronavirus has resulted in enhanced health screenings, healthcare service preparation and delivery, quarantines, cancellations, disruptions to markets, supply chains and customer activity, as well as general concern and uncertainty. Although a number of vaccines for COVID-19 have been developed and are in the process of being deployed in certain countries, including the United States, the timing for widespread vaccination is uncertain, and these vaccines may be less effective against new mutated strains of the virus. The impact of this coronavirus continues to evolve and is affecting the economies of many nations, individual companies and markets in general and may continue to last for an extended period of time.

Management will continue to evaluate the impact of the COVID-19 pandemic and while the virus could have an adverse effect on the future financial results, cash flows and/or search for a target company, the specific impact is not readily determinable as of the date of these unaudited condensed financial statements. The unaudited condensed financial statements do not include any adjustments that might result from the outcome of this uncertainty.

FORTRESS VALUE ACQUISITION CORP. III

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

2. Restatement of Previously Issued Financial Statements

The Company restated certain line items related to the previously filed financial statements for June 30, 2021 and March 31, 2021 on Form 10-Q filed with the SEC on August 9, 2021 and May 12, 2021, respectively, to classify all Class A common stock in temporary equity. In accordance with the SEC and its staff’s guidance on redeemable equity instruments, which has been codified in Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 480, “Distinguishing Liabilities from Equity” (“ASC 480”), paragraph 10-S99-3A, redemption provisions not solely within the control of the Company require common stock subject to redemption to be classified outside of permanent equity. The Company had previously classified 2,949,006 shares and 2,804,346 shares as of June 30, 2021 and March 31, 2021, respectively, in permanent equity. Although the Company did not specify a maximum redemption threshold, its amended and restated certificate of incorporation provides that the Company will not redeem its Public Shares in an amount that will cause its net tangible assets to be less than $5,000,001. Upon re-evaluation, the Company determined that the Class A common stock includes certain provisions that require classification of the Class A common stock as temporary equity regardless of the minimum net tangible assets threshold. As a result, the Company restated its previously filed financial statements to classify all Class A common stock as temporary equity and to remeasure from its initial book value to redemption value at the time of its Initial Public Offering and in accordance with ASC 480. The change in the carrying value of redeemable shares of Class A common stock resulted in charges against Additional paid-in capital and Accumulated deficit, as described below in more detail. In connection with the change in presentation for the Class A common stock subject to possible redemption, the Company also restated its earnings per share calculation to allocate net income (loss) pro-rata to Class A and Class F common stock. This presentation contemplates a Business Combination as the most likely outcome, in which case, both classes of common shares share pro-rata in the income (loss) of the Company. There has been no change in the Company’s total assets, liabilities, operating results or liquidity, in any of the periods.

Impact of Restatement - Quarterly Interim Periods (Unaudited)

The following presents a reconciliation of the condensed balance sheets, condensed statements of operations, condensed statements of changes in stockholders’ equity and condensed statements of cash flows from the prior periods previously reported to the restated amounts as of June 30, 2021 and March 31, 2021, for the three and six months ended June 30, 2021 and for the three months ended March 31, 2021.

FORTRESS VALUE ACQUISITION CORP. III

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS


	June 30, 2021
Condensed Balance Sheet Data (Unaudited)	As previously reported		Adjustments		As restated
Class A common stock subject to possible redemption (as previously reported: 20,050,994 shares subject to possible redemption) as restated: 23,000,000 shares subject to possible redemption	$	200,509,940	$	29,490,060	$	230,000,000
Class A common stock, $0.0001 par value; (as previously reported: 2,949,006 shares issued and outstanding) as restated: no shares issued and outstanding	$	295	$	(295)	$	—
Additional paid-in capital	$	8,566,094	$	(8,566,094)	$	—
Accumulated deficit	$	(3,566,960)	$	(20,923,671)	$	(24,490,631)
Total Stockholders’ Equity	$	5,000,004	$	(29,490,060)	$	(24,490,056)


	For the three months ended June 30, 2021
Condensed Statement of Operations (Unaudited)	As previously reported		Adjustments		As restated
Basic and diluted net income (loss) per share, Class A common stock	$	0.00	$	(0.05)	$	(0.05)
Basic and diluted net income (loss) per share, Class F common stock	$	(0.25)	$	0.20	$	(0.05)


	For the six months ended June 30, 2021
Condensed Statement of Operations (Unaudited)	As previously reported		Adjustments		As restated
Basic and diluted net income (loss) per share, Class A common stock	$	0.00	$	(0.12)	$	(0.12)
Basic and diluted net income (loss) per share, Class F common stock	$	(0.62)	$	0.50	$	(0.12)


	For the three months ended June 30, 2021
Condensed Statement of Changes in Stockholders’ Equity (Unaudited)	As previously reported		Adjustments		As restated
Change in Class A common stock subject to possible redemption:
Class A Shares	144,660		(144,660)		—
Class A Amount	$	15	$	(15)	$	—
Additional paid-in capital	$	1,446,585	$	(1,446,585)	$	—
Total Stockholders’ Equity	$	1,446,600	$	(1,446,600)	$	—


	For the six months ended June 30, 2021
Condensed Statement of Cash Flows (Unaudited)	As previously reported		Adjustments		As restated
Supplemental disclosure of non-cash financing activities:
Class A common stock subject to possible redemption	$	200,509,940	$	(200,509,940)	$	—

FORTRESS VALUE ACQUISITION CORP. III

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS


	March 31, 2021
Condensed Balance Sheet Data (Unaudited)	As previously reported		Adjustments		As restated
Class A common stock subject to possible redemption (as previously reported: 20,195,654 shares subject to possible redemption) as restated: 23,000,000 shares subject to possible redemption	$	201,956,540	$	28,043,460	$	230,000,000
Class A common stock, $0.0001 par value; (as previously reported: 2,804,346 shares issued and outstanding) as restated: no shares issued and outstanding	$	280	$	(280)	$	—
Additional paid-in capital	$	7,119,509	$	(7,119,509)	$	—
Accumulated deficit	$	(2,120,363)	$	(20,923,671)	$	(23,044,034)
Total Stockholders’ Equity	$	5,000,001	$	(28,043,460)	$	(23,043,459)


	For the three months ended March 31, 2021
Condensed Statement of Operations (Unaudited)	As previously reported		Adjustments		As restated
Basic and diluted net income (loss) per share, Class A common stock	$	0.00	$	(0.07)	$	(0.07)
Basic and diluted net income (loss) per share, Class F common stock	$	(0.37)	$	0.30	$	(0.07)


	For the three months ended March 31, 2021
Condensed Statement of Changes in Stockholders’ Equity (Unaudited)	As previously reported		Adjustments		As restated
Sale of Units in Initial Public Offering, net of offering costs related to Class A common stock and initial fair value of Public Warrants:
Class A Shares	23,000,000		(23,000,000)		—
Class A Amount	$	2,300	$	(2,300)	$	—
Additional paid-in capital	$	209,049,604	$	(209,049,604)	$	—
Total Stockholders’ Equity	$	209,051,904	$	(209,051,904)	$	—

Class A common stock subject to possible redemption:
Class A Shares	(20,195,654)		20,195,654		—
Class A Amount	$	(2,020)	$	2,020	$	—
Additional paid-in capital	$	(201,954,520)	$	201,954,520	$	—
Total Stockholders’ Equity	$	(201,956,540)	$	201,956,540	$	—

Remeasurement of Class A common stock subject to possible redemption to redemption value:
Additional paid-in capital	$	—	$	(24,425)	$	(24,425)
Accumulated deficit	$	—	$	(20,923,671)	$	(20,923,671)
Total Stockholders’ Equity	$	—	$	(20,948,096)	$	(20,948,096)

FORTRESS VALUE ACQUISITION CORP. III

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS


	For the three months ended March 31, 2021
Condensed Statement of Cash Flows (Unaudited)	As previously reported		Adjustments		As restated
Supplemental disclosure of non-cash financing activities:
Class A common stock subject to possible redemption	$	201,956,540	$	(201,956,540)	$	—

3. 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 (“U.S. GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Regulation S-X of the SEC. Certain information or footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented. Operating results for the three and nine months ended September 30, 2021 are not necessarily indicative of the results that may be expected through December 31, 2021 or any future periods. These unaudited condensed financial statements should be read in conjunction with the Company’s financial statements for the period from August 28, 2020 through December 31, 2020 and footnotes thereto included in the Company’s Annual Report on Form 10-K filed with the SEC on March 26, 2021.

Emerging growth company

The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

SEC Form 10-Q/A filed by Fortress Value Acquisition Corp. III (Amendment)