Christopher Stephen Phillips - Apr 19, 2022 Form 4 Insider Report for System1, Inc. (SST)

Role: Director, 10%+ Owner
Signature: By: /s/ Daniel Weinrot, Attorney-in-Fact for Christopher Stephen Phillips
Stock symbol: SST
Transactions as of: Apr 19, 2022
Transactions value $: $856
Form type: 4
Date filed: 4/21/2022, 09:45 PM
Previous filing: Feb 1, 2022
Next filing: Apr 22, 2022

Transactions Table

Type	Sym	Class	Transaction	Value $	Shares	Change %	* Price $	Shares After	Date	Ownership	Footnotes
transaction	SST	Class A Common Stock	Options Exercise	$5.75M	+500K	+68.97%	$11.50^*	1.23M	Apr 19, 2022	By Just Develop It Limited	F1, F2
transaction	SST	Class A Common Stock	Tax liability	-$5.75M	-285K	-23.3%	$20.14^*	940K	Apr 19, 2022	By Just Develop It Limited	F1, F2, F3, F4
holding	SST	Class A Common Stock						28.7M	Apr 19, 2022	By JDI & AFH Limited	F4

Derivative Securities (e.g., puts, calls, warrants, options, convertible securities)

Type	Sym	Class	Transaction	Value $	Shares	Change %	* Price $	Shares After	Date	Underlying Class	Amount	Exercise Price	Ownership	Footnotes
transaction	SST	Warrants (Right to buy)	Options Exercise		-500K	-100%		0	Apr 19, 2022	Class A common stock, par value $0.0001 per share	500K	$11.50	By Just Develop It Limited	F1, F2

* An asterisk sign (*) next to the price indicates that the price is likely invalid.

Explanation of Responses:

Id	Content
F1	On April 19, 2022, Just Develop It Limited ("JDI") exercised 500,000 warrants to purchase shares of the Class A common stock of the Company. JDI elected to exercise the warrants on a cashless basis (the "Cashless Exercise") pursuant to Section 3.3.1(c) of that certain Warrant Agreement, dated June 19, 2020 (the "Warrant Agreement"), by and between the Company and Continental Stock Transer & Trust Company (the "Warrant Agent").
F2	(Continued from Footnote 1) Orchid Merger Sub I, Inc. ("Merger Sub I"), Orchid Merger Sub II, LLC ("Merger Sub II" and, together with Merger Sub I, the "Merger Subs"), System1 SS Protect Holdings, Inc. and the other parties signatory to that certain Business Combination Agreement, dated as of June 28, 2021 (as amended on November 30, 2021, January 10, 2022 and January 25, 2022). Pursuant to the Cashless Exercise, no shares of Class A common stock were sold by JDI but rather JDI forfeited shares of Class A common stock in an amount equal to the total exercise price of the underlying warrants that were subject to the Cashless Exercise.
F3	Represents shares of Class A common stock "withheld" in connection with the Cashless Exercise. Pursuant to Section 3.3.1(c) of the Warrant Agreement, the price was calculated as the average last reported sale price of the shares for the ten trading days ending on the third trading day prior to the date on which notice of exercise of the private placement warrant was sent to the Warrant Agent.
F4	JDI & AFH Limited ("J&A") is a private limited company organized under the laws of England and Wales, whose controlling stockholder is JDI. JDI may be deemed to indirectly beneficially own the securities held by J&A. Christopher Phillips, a director of the Company, is a director of J&A and JDI. JDI's controlling stockholder is Christopher Phillips. Mr. Phillips has voting and dispositive power over the securities held by J&A and JDI and thus may be deemed to beneficially own the shares held by J&A and JDI, but disclaims such beneficial ownership except to any pecuniary interest therein.