KSI Kadem Sustainable Impact Corporation

Kadem Sustainable Impact Corporation, a Delaware corporation (the “Corporation”), was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination, involving the Corporation and one or more businesses (a “Business Combination”). The Amended and Restated Certificate of Incorporation of the Corporation (the “Charter”) provides that, prior to the consummation of the initial Business Combination, the Corporation must provide all holders of shares of the Corporation’s Class A Common Stock included as part of the units sold in the Corporation’s initial public offering (“Offering Shares”) with the opportunity to have their Offering Shares redeemed upon the consummation of the initial Business Combination pursuant to, and subject to the limitations of, the Charter for cash equal to the applicable redemption price per share determined in accordance with the Charter; provided, however, that the Corporation may not redeem or repurchase Offering Shares to the extent that such redemption would result in the Corporation’s failure to have net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) under the Securities Exchange Act of 1934, as amended (or any successor rule)) in excess of $5 million or any greater net tangible asset or cash requirement which may be contained in the agreement relating to the initial Business Combination.

In accordance with Financial Accounting Standards Board Accounting Standards Codification 480, “Distinguishing Liabilities from Equity” (“ASC 480”), redemption provisions not solely within the control of the Corporation require common stock subject to redemption to be classified outside of permanent equity. In the Corporation’s (i) balance sheet as of March 19, 2021 included in the Corporation’s Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on March 25, 2021 (the “March 19, 2021 Balance Sheet”), (ii) financial statements as of March 31, 2021 and for the three months ended March 31, 2021 included in the Corporation’s Quarterly Report on Form 10-Q filed with the SEC on May 17, 2021 (as amended) (the “Q1 2021 Financial Statements”), and (iii) financial statements as of June 30, 2021 and for the three and six months ended June 30, 2021 included in the Corporation’s Quarterly Report on Form 10-Q filed with the SEC on August 16, 2021 (the “Q2 2021 Financial Statements” and, together with the March 19, 2021 Balance Sheet and the Q1 2021 Financial Statements, the “Financial Statements”), the Corporation classified a portion of its Class A Common Stock in permanent equity, or total stockholders’ (deficit) equity. Although the Corporation did not specify a maximum redemption threshold, the Charter provision described above does not permit the Company to redeem Offering Shares in an amount that would cause its net tangible assets to be less than $5,000,001. Management has now determined, after consultation with its advisors, and in light of SEC comments recently reported in respect of other special purpose acquisition companies, that the Offering Shares can be redeemed or become redeemable subject to the occurrence of future events considered to be outside the Corporation’s control. Accordingly, the Corporation’s management has concluded that the Corporation should present all redeemable Class A Common Stock as temporary equity and recognize accretion from the initial book value to redemption value at the time of the Corporation’s initial public offering and in accordance with ASC 480.

On November 15, 2021, the Audit Committee of the Board of Directors of the Corporation concluded, after discussion with the Corporation’s management, that the Financial Statements should no longer be relied upon due to changes required to reclassify all of the Corporation’s Class A Common Stock subject to possible redemption in temporary equity. The Corporation plans to reflect this reclassification of the Corporation’s Class A Common Stock subject to possible redemption in its upcoming Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2021, to be filed with SEC.

In addition, the Corporation’s management has concluded that, as of September 30, 2021, there was a material weakness in the Corporation’s internal control over financial reporting relating to the Corporation’s interpretation and accounting for certain complex features of the Offering Shares.

The Corporation does not expect any of the above changes will have any impact on its cash position or cash held in the trust account.

The Corporation has discussed the matters disclosed in this Current Report on Form 8-K with its independent registered public accounting firm, Marcum LLP.