ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification Number) | |
(Address of principal executive offices) |
(Zip Code) |
Title of Each Class: |
Trading Symbol(s) |
Name of Each Exchange on Which Registered: | ||
Class A Common Stock for $11.50 per share |
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
☒ | Smaller reporting company | |||||
Emerging growth company |
• | our ability to select an appropriate target business or businesses; |
• | our ability to complete our initial business combination; |
• | our expectations around the performance of the prospective target business or businesses; |
• | our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business combination; |
• | our officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or in approving our initial business combination; |
• | our potential ability to obtain additional financing to complete our initial business combination; |
• | our pool of prospective target businesses; |
• | the ability of our officers and directors to generate a number of potential business combination opportunities; |
• | our public securities’ potential liquidity and trading; |
• | the use of proceeds not held in the trust account or available to us from interest income on the trust account balance; |
• | the trust account not being subject to claims of third parties; or |
• | our financial performance. |
• | “Class A common stock” are to our Class A common stock, par value $0.0001 per share; |
• | “common stock” are to our Class A common stock and our Class B common stock, collectively; |
• | “founder shares” or “Class B common stock” are to shares of our Class B common stock, par value $0.0001 per share, held by our initial stockholders prior to our initial public offering, and the shares of our Class A common stock issued upon the conversion thereof; |
• | “initial stockholders” are to our sponsor and any other holders of our founder shares prior to our initial public offering (or their permitted transferees); |
• | “initial stockholders” are to our sponsor and any other holders of our founder shares prior to our initial public offering (or their permitted transferees); |
• | “Jefferies” are to Jefferies LLC, a Delaware limited liability company, and the sole book-running manager of our initial public offering; |
• | “management” or our “management team” are to our officers and directors; |
• | “Mudrick Capital” are to Mudrick Capital Management, L.P., a Delaware limited partnership, and its affiliates, an affiliate of our sponsor; |
• | “private placement warrants” are to the warrants issued to our sponsor and Jefferies in a private placement simultaneously with the closing of our initial public offering; |
• | “public shares” are to shares of our Class A common stock sold as part of the units in our initial public offering (whether they are purchased in our initial public offering or thereafter in the open market); |
• | “public stockholders” are to the holders of our public shares, including our initial stockholders and members of our management team to the extent our initial stockholders and/or members of our management team purchase public shares; provided that each initial stockholder’s and member of our management team’s status as a “public stockholder” shall only exist with respect to such public shares; |
• | “public warrants” are to our redeemable warrants sold as part of the units in our initial public offering (whether they are purchased in our initial public offering or thereafter in the open market), to the private placement warrants if held by third parties other than our sponsor or Jefferies (or permitted transferees), and to any private placement warrants issued upon conversion of working capital loans that are sold to third parties that are not initial purchasers of our private placement warrants or executive officers or directors (or permitted transferees); |
• | “sponsor” are to Mudrick Capital Acquisition Holdings LLC, a Delaware limited liability company which is 100% owned by investment funds and separate accounts managed by Mudrick Capital; |
• | “specified future issuance” are to an issuance of a class of equity or equity-linked securities to specified purchasers, which may include affiliates of Mudrick Capital and/or one or more investors in funds managed by Mudrick Capital, that we may determine to make in connection with financing our initial business combination, to the extent permitted under applicable regulatory and contractual requirements related to those funds and accounts; |
• | “trust account” are to the trust account in the United States at J.P. Morgan Chase Bank, N.A., with Continental Stock Transfer & Trust Company acting as trustee, into which we have deposited certain proceeds from our initial public offering and the sale of the private placement warrants; |
• | “warrants” are to our redeemable warrants, which includes the public warrants as well as the private placement warrants to the extent they are no longer held by the initial purchaser of the private placement warrants or its permitted transferees; and |
• | “we,” “us,” “Company” or “our Company” are to Mudrick Capital Acquisition Corporation II. |
• | According to S&P, their leveraged loan “Weakest Link” count, which reflects companies with a B- or lower credit rating and a negative outlook, has more than doubled since 2019, rising from 145 companies, or 11% of the S&P coverage universe, to 329 companies as of June 2020, or 25%; |
• | U.S. default rates have risen sharply this year and are projected to continue to rise over the next 12 months. According to S&P, the trailing 12 month default rate has doubled since the beginning of the year to 3.9% and is projected to reach over 10% within the next 12 months. Defaults have ranged across a large number of industries including Business Services, Consumer and Industrials, according to S&P; |
• | The U.S. leveraged loan market today is approximately $1.2 trillion, which is approximately double the size of the market during the 2008-2009 credit cycle. This means that similar default rates in today’s market would imply a significantly larger volume of restructured liabilities; |
• | Collateralized loan obligations (“ CLOs ”) represent a much larger ownership of today’s leveraged loan market compared to the leveraged loan market in 2008-2009. There has been almost 2.5x the CLO issuance from 2013-2019 ($743 billion) compared to 2001-2007 ($302 billion). The increased CLO market share of the leverage loan market may lead to a larger number of post-restructured companies with equity ownership being held by CLOs, which could lead to attractive investment opportunities at relatively more favorable terms. |
• | Post-Restructured Companies . We are seeking candidates that have recently restructured their balance sheet. We believe that post-restructured companies may be valued at a discount to their publicly traded peers due to the non-long term nature of their ownership base (former creditors are typically the new equity owners post-restructuring), the complexity in understanding their restructuring, the lack of clarity and information regarding their financial performance, the concentrated nature of their ownership base and the lack of a publicly traded equity, among other reasons. We also believe that post-restructured companies are where we have the strongest network to identify opportunities and the greatest ability and experience to provide stockholder value. |
• | Middle-Market Companies . We are seeking candidates with an enterprise value of approximately $750 million to $2.0 billion, determined in the sole discretion of our officers and directors according to reasonably accepted valuation standards and methodologies. We believe that post-restructured middle-market companies suffer from a larger valuation discount to their publicly traded peers than larger companies. |
• | Companies with Stressed Capital Structures . We are targeting companies that, due to the economic dislocation caused by COVID-19, have near-term earnings and cash flow profiles that cannot support their pre-COVID-19 |
• | Market Leaders with Defensible Business Models and Stable Cash Flows . We are targeting companies that have restructured or need to restructure their balance sheets due to a bad balance sheet, and not a bad business. We intend to seek candidates that are market leaders in their industry, have defensible business models, and generate stable and predictable cash flows. |
• | Discount to Publicly Traded Peers . We are seeking candidates that are valued in the private market at a significant discount to their publicly traded peers. We believe that this discount will facilitate the initial business combination negotiation by allowing the opportunity for liquidity and multiple expansion for the targets’ current stockholders, while at the same time allowing meaningful upside for our stockholders post-business combination. |
• | Strong Management Teams . We are targeting businesses that have strong, experienced management teams. We also may be able to assist with potential management additions from our network of experienced turnaround professionals. Additionally, we may seek to optimize the management team of a potential target business by introducing board members with relevant insight and experience. |
• | Benefit from Being a Public Company . We are pursuing business combinations with companies that will benefit from being publicly traded and can effectively utilize the broader access to capital and public profile that are associated with being a publicly traded company. |
• | subject us to negative economic, competitive and regulatory developments, any or all of which may have a substantial adverse impact on the particular industry in which we operate after our initial business combination, and |
• | cause us to depend on the marketing and sale of a single product or limited number of products or services. |
Type of Transaction |
Whether Stockholder Approval is Required | |
Purchase of assets | No | |
Purchase of stock of target not involving a merger with the company | No | |
Merger of target into a subsidiary of the company | No | |
Merger of the company with a target | Yes |
• | we issue shares of Class A common stock that will be equal to or in excess of 20% of the number of shares of our Class A common stock then outstanding; |
• | any of our directors, officers or substantial stockholders (as defined by Nasdaq rules) has a 5% or greater interest (or such persons collectively have a 10% or greater interest), directly or indirectly, in the target business or assets to be acquired or otherwise and the present or potential issuance of common stock could result in an increase in outstanding common shares or voting power of 5% or more; or |
• | the issuance or potential issuance of common stock will result in our undergoing a change of control. |
• | conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and |
• | file proxy materials with the SEC. |
• | conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers, and |
• | file tender offer documents with the SEC prior to completing our initial business combination, which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. |
• | we are an early stage company with no revenue or basis to evaluate our ability to select a suitable business target; |
• | we may not be able to select an appropriate target business or businesses and complete our initial business combination in the prescribed time frame; |
• | as the number of special purpose acquisition companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets, which could increase the cost of our initial business combination and could even result in our inability to find a target or to consummate an initial business combination; |
• | our expectations around the performance of a prospective target business or businesses may not be realized; |
• | we may not be successful in retaining or recruiting required officers, key employees or directors following our initial business combination; |
• | our officers and directors may have difficulties allocating their time between the Company and other businesses and may potentially have conflicts of interest with our business or in approving our initial business combination; |
• | we may not be able to obtain additional financing to complete our initial business combination or reduce the number of stockholders requesting redemption; |
• | we may issue our shares to investors in connection with our initial business combination at a price that is less than the prevailing market price of our shares at that time; |
• | stockholders may not be given the opportunity to choose the initial business target or to vote on the initial business combination; |
• | trust account funds may not be protected against third party claims or bankruptcy; |
• | an active market for our public securities may not develop and stockholders will have limited liquidity and trading; |
• | the availability to us of funds from interest income on the trust account balance may be insufficient to operate our business prior to the business combination; |
• | our financial performance following a business combination with an entity may be negatively affected by their lack an established record of revenue, cash flows and experienced management; |
• | our warrants are accounted for as liabilities and the changes in value of our warrants could have a material effect on our financial results; |
• | we have identified a material weakness in our internal control over financial reporting related to accounting for complex financial instruments, and if we are unable to maintain an effective system of disclosure controls and procedures and internal control over financial reporting, we may not be able to accurately report our financial results in a timely manner, which may adversely affect investor confidence in us and materially and adversely affect our business and financial results; |
• | our ability to continue as a going concern; and |
• | escalating tensions between Russia and Ukraine and any continuing military incursion by Russia into Ukraine could adversely impact macroeconomic conditions, give rise to regional instability and result in heightened economic sanctions from the U.S. and the international community in a manner that adversely affects us and our ability to consummate our initial business combination. |
1. | pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of our company, |
2. | provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with GAAP, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors, and |
3. | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the consolidated financial statements. |
Directors and Executive Officers | ||||
NAME |
AGE |
POSITION | ||
Jason Mudrick |
47 | Chief Executive Officer and Chairman of the Board of Directors | ||
Victor Danh |
44 | Vice President | ||
David Kirsch |
42 | Vice President and Director | ||
Glenn Springer |
49 | Chief Financial Officer | ||
Dennis Stogsdill |
51 | Director | ||
Scott Kasen |
56 | Director | ||
Dr. Brian Kushner |
63 | Director |
• | the appointment, compensation, retention, replacement, and oversight of the work of the independent registered public accounting firm engaged by us; |
• | pre-approving all audit and permitted non-audit services to be provided by the independent registered public accounting firm engaged by us, and establishing pre-approval policies and procedures; |
• | setting clear hiring policies for employees or former employees of the independent registered public accounting firm, including but not limited to, as required by applicable laws and regulations; |
• | setting clear policies for audit partner rotation in compliance with applicable laws and regulations; |
• | obtaining and reviewing a report, at least annually, from the independent registered public accounting firm describing (i) the independent registered public accounting firm’s internal quality-control procedures, (ii) any material issues raised by the most recent internal quality-control review, or peer review, of the audit firm, or by any inquiry or investigation by governmental or professional authorities within the preceding five years respecting one or more independent audits carried out by the firm and any steps taken to deal with such issues and (iii) all relationships between the independent registered public accounting firm and us to assess the independent registered public accounting firm’s independence; |
• | reviewing and approving any related party transaction required to be disclosed pursuant to Item 404 of Regulation S-K promulgated by the SEC prior to us entering into such transaction; and |
• | reviewing with management, the independent registered public accounting firm, and our legal advisors, as appropriate, any legal, regulatory or compliance matters, including any correspondence with regulators or government agencies and any employee complaints or published reports that raise material issues regarding our financial statements or accounting policies and any significant changes in accounting standards or rules promulgated by the Financial Accounting Standards Board, the SEC or other regulatory authorities. |
• | reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officer’s compensation, if any is paid by us, evaluating our Chief Executive Officer’s performance in light of such goals and objectives and determining and approving the remuneration (if any) of our Chief Executive Officer based on such evaluation; |
• | reviewing and approving on an annual basis the compensation, if any is paid by us, of all of our other officers; |
• | reviewing on an annual basis our executive compensation policies and plans; |
• | implementing and administering our incentive compensation equity-based remuneration plans; |
• | assisting management in complying with our proxy statement and annual report disclosure requirements; |
• | approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our officers and employees; |
• | if required, producing a report on executive compensation to be included in our annual proxy statement; and |
• | reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors. |
• | None of our officers or directors is required to commit their full time to our affairs and, accordingly, may have conflicts of interest in allocating their time among various business activities. |
• | In the course of their other business activities, our officers and directors may become aware of investment and business opportunities which may be appropriate for presentation to us, as well as the other entities with which they are affiliated. Our management may have conflicts of interest in determining to which entity a particular business opportunity should be presented. |
• | Our initial stockholders have agreed to waive their redemption rights with respect to any founder shares and any public shares held by them in connection with the consummation of our initial business combination. Additionally, our initial stockholders have agreed to waive their redemption rights with respect to any founder shares held by them if we fail to consummate our initial business combination by September 10, 2022. If we do not complete our initial business combination within such applicable time period, the proceeds of the sale of the private placement warrants held in the trust account will be used to fund the redemption of our public shares, and the private placement warrants will expire worthless. With certain limited exceptions, the founder shares will not be transferable, assignable by our sponsor until the earlier of: (A) one year after the completion of our initial business combination or (B) subsequent to our initial business combination, (x) if the reported closing price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30 — trading day period commencing at least 150 days after our initial business combination, or (y) the date on which we complete a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property. With certain limited exceptions, the private placement warrants and the Class A common stock underlying such warrants, will not be transferable, assignable or saleable by our sponsor or its permitted transferees until 30 days after the completion of our initial business combination. Since our sponsor and officers and directors own or may in the future directly or indirectly own common stock and warrants, our officers and directors may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. |
• | Our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. |
• | Our sponsor, officers or directors may have a conflict of interest with respect to evaluating a business combination and financing arrangements as we may obtain loans from our sponsor or an affiliate of our sponsor or any of our officers or directors to finance transaction costs in connection with an intended initial business combination. Up to $1,500,000 of such loans may be convertible into warrants at a price of $1.00 per warrant at the option of the lender. Such warrants would be identical to the private placement warrants, including as to exercise price, exercisability and exercise period. |
• | the corporation could financially undertake the opportunity; |
• | the opportunity is within the corporation’s line of business; and |
• | it would not be fair to our company and its stockholders for the opportunity not to be brought to the attention of the corporation. |
• | each person known by us to be the beneficial owner of more than 5% of our outstanding common stock; |
• | each of our executive officers and directors that beneficially owns our common stock; and |
• | all our executive officers and directors as a group. |
Class A Common Stock |
Class B Common Stock |
Approximate |
||||||||||||||||||
Name and Address of Beneficial Owner (1) |
Number of Shares Beneficially Owned |
Approximate Percentage of Class |
Number of Shares Beneficially Owned |
Approximate Percentage of Class |
Percentage of Outstanding Common Stock |
|||||||||||||||
Mudrick Capital Acquisition Holdings II LLC (2)(3) |
— | — | 7,906,250 | 100 | % | 20.0 | % | |||||||||||||
Jason Mudrick (2)(3) |
— | — | 7,906,250 | 100 | % | 20.0 | % | |||||||||||||
Victor Danh |
— | — | — | — | — | |||||||||||||||
David Kirsch |
— | — | — | — | — | |||||||||||||||
Glenn Springer |
— | |||||||||||||||||||
Dennis Stogsdill (3) |
— | — | — | — | — | |||||||||||||||
Scott Kasen (3) |
— | — | — | — | — | |||||||||||||||
Dr. Brian Kushner (3) |
— | — | — | — | — | |||||||||||||||
All directors and executive officers as a group (7 individuals) (2) |
— | — | 7,906,250 | 100 | % | 20.0 | % | |||||||||||||
Other 5% Stockholders |
||||||||||||||||||||
Anson Funds Management LP (4) |
2,050,000 | 6.5 | % | — | — | — | % | |||||||||||||
Saba Capital Management, L.P. (5) |
2,440,841 | 7.7 | % | — | — | — | % | |||||||||||||
Sculptor Capital LP (6) |
2,987,883 | 9.5 | % | — | — | — | % |
(1) | Unless otherwise noted, the business address of each of the following entities or individuals is c/o Mudrick Capital Acquisition Holdings II LLC, 527 Madison Avenue, 6th Floor, New York, New York 10022. |
(2) | Interests shown consist solely of founder shares, classified as shares of Class B common stock. Such shares are convertible into shares of Class A common stock on a one-for-one basis, subject to adjustment pursuant to the anti-dilution provisions contained therein. |
(3) | Our sponsor is the record holder of such shares. Mudrick Capital Management, L.P. is the managing member of the sponsor and has voting and dispositive power of the shares. Jason Mudrick is the sole member of Mudrick Capital Management, LLC, the general partner of Mudrick Capital Management, L.P., and as a result each has voting and investment discretion with respect to the shares held by the sponsor. Mudrick Capital Management, L.P., Mudrick Capital Management LLC and Jason Mudrick disclaim beneficial ownership over any securities directly held by our sponsor other than to the extent of any pecuniary interest it may have therein, directly or indirectly. Our sponsor is 100% owned by investment funds and separate accounts managed by Mudrick Capital Management, L.P. Each of our independent directors hold a direct or indirect interest in our sponsor. The address of each reporting person is 527 Madison Avenue, 6th Floor, New York, NY 10022. |
(4) | According to a Schedule 13G filed with the SEC on February 14, 2022, Anson Funds Management LP (“Anson LP”), Anson Management GP LLC (“Anson GP”), Anson Advisors Inc. (“Anson Advisors”), Bruce R Winson, Amin Nathoo, and Moez Kassam are beneficial owners of 2,050,000 shares of Class A common stock. The business address for Anson LP, Anson GP and Mr. Winson is 16000 Dallas Parkway, Suite 800, Dallas, Texas 75248. The business address for Anson Advisors, Mr. Nathoo and Mr. Kassam is 155 University Ave, Suite 207, Toronto, ON M5H 3B7. |
(5) | According to a Schedule 13G/A filed with the SEC on February 14, 2022, Saba Capital Management, L.P., Saba Capital Management GP, LLC, and Mr. Boaz R. Weinstein are beneficial owners of 2,440,841 shares of Class A common stock. The business address of each of the foregoing is 405 Lexington Avenue, 58th Floor, New York, New York 10174. |
(6) | According to a Schedule 13G filed with the SEC on February 14, 2022, each of Sculptor Capital Management, Inc., Sculptor Capital Holding II LLC, Sculptor Capital Holding II Corp., Sculptor Capital II LP and Sculptor Capital LP share voting and dispositive power with regard to 2,987,883 shares of Class A common stock. The business address of the foregoing entities is 9 West 57th Street, New York, New York 10019. |
1) | Financial Statements |
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Financial Statements: |
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F-6 | ||||
F-7 |
2) | Financial Statements Schedule |
3) | Exhibits |
F-2 |
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Consolidated Financial Statements: |
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F-4 |
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F-5 |
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F-6 |
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F-7 |
December 31, 2021 |
December 31, 2020 |
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ASSETS |
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Current assets |
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Cash |
$ | $ | ||||||
Prepaid expenses |
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Total Current Assets |
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Investments held in Trust Account |
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TOTAL ASSETS |
$ |
$ |
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LIABILITIES, CLASS A COMMON STOCK SUBJECT TO POSSIBLE REDEMPTION AND STOCKHOLDERS’ DEFICIT |
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Current liabilities |
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Accrued expenses |
$ | $ | ||||||
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Total Current Liabilities |
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Convertible note – related party |
— |
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Warrant liabilities |
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Deferred underwriting fee payable |
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TOTAL LIABILITIES |
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Commitments and Contingencies |
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Class A common stock subject to possible redemption |
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Stockholders’ Deficit |
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Preferred stock, $ |
— | — | ||||||
Class A common stock, $ |
— | — | ||||||
Class B common stock, $ |
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Additional paid-in capital |
— | — | ||||||
Accumulated deficit |
( |
) | ( |
) | ||||
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Total Stockholders’ Deficit |
( |
) |
( |
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TOTAL LIABILITIES, CLASS A COMMON STOCK SUBJECT TO POSSIBLE REDEMPTION AND STOCKHOLDERS’ DEFICIT |
$ |
$ |
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Year Ended December 31, 2021 |
For the Period from July 30, 2020 (Inception) through December 31, 2020 |
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General and administrative expenses |
$ | $ | ||||||
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Loss from operations |
( |
) |
( |
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Other income (expense): |
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Interest earned on investments held in Trust Account |
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Change in fair value of warrant liabilities |
( |
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Transaction costs |
( |
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Total other income (expense), net |
( |
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Net loss |
$ |
( |
) |
$ |
( |
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Weighted average shares outstanding, Class A common stock |
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Basic and diluted net loss per share, Class A common stock |
$ |
( |
) |
$ |
( |
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Weighted average shares outstanding, Class B common stock |
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Basic and diluted net loss per share, Class B common stock |
$ |
( |
) |
$ |
( |
) | ||
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Class A Common Stock |
Class B Common Stock |
Additional Paid-in |
Accumulated |
Total Stockholders’ |
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Shares |
Amount |
Shares |
Amount |
Capital |
Deficit |
Deficit |
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Balance – July 30, 2020 (Inception) |
$ |
$ |
$ |
$ |
$ |
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Issuance of Class B common stock to Sponsor |
— | — | — | |||||||||||||||||||||||||
Sale of Private Placement Warrants (Proceeds received in excess of fair value) |
— | — | — | — | — | |||||||||||||||||||||||
Accretion for Class A common stock to redemption amount |
— | — | — | — | ( |
) | ( |
) | ( |
) | ||||||||||||||||||
Net loss |
— | — | — | — | — | ( |
) | ( |
) | |||||||||||||||||||
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Balance – December 31, 2020 |
$ |
$ |
$ |
$ |
( |
) |
$ |
( |
) | |||||||||||||||||||
Net loss |
— | — | — | — | — | ( |
) | ( |
) | |||||||||||||||||||
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Balance – December 31, 2021 |
$ |
$ |
$ |
$ |
( |
) |
$ |
( |
) | |||||||||||||||||||
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Year Ended December 31, 2021 |
For the Period from July 30, 2020 (Inception) Through December 31, 2020 |
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Cash Flows from Operating Activities: |
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Net loss |
$ | ( |
) | $ | ( |
) | ||
Adjustments to reconcile net loss to net cash used in operating activities: |
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Payment of formation costs through promissory note – related party |
— | |||||||
Change in fair value of warrant liabilities |
( |
) | ||||||
Transaction costs allocated to warrants |
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Interest earned on investments held in Trust Account |
( |
) | ( |
) | ||||
Changes in operating assets and liabilities: |
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Prepaid expenses |
( |
) | ||||||
Accrued expenses |
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Net cash used in operating activities |
( |
) |
( |
) | ||||
|
|
|
|
|||||
Cash Flows from Investing Activities: |
||||||||
Investment of cash in Trust Account |
( |
) | ||||||
Cash withdrawn from Trust Account to pay franchise and income taxes |
||||||||
|
|
|
|
|||||
Net cash provided by (used in) investing activities |
( |
) | ||||||
Cash Flows from Financing Activities: |
||||||||
Proceeds from sale of Units, net of underwriting discounts paid |
||||||||
Proceeds from sale of Private Placement Warrants |
||||||||
Proceeds from promissory note – related party |
— | |||||||
Repayment of promissory note – related party |
( |
) | ||||||
Payment of offering costs |
( |
) | ||||||
Advances from related party |
— | |||||||
Repayment of advances from related party |
( |
) | — | |||||
Proceeds from convertible note – related party |
— | |||||||
|
|
|
|
|||||
Net cash provided by financing activities |
||||||||
|
|
|
|
|||||
Net Change in Cash |
( |
) |
||||||
Cash – Beginning of period |
— | |||||||
|
|
|
|
|||||
Cash – End of period |
$ |
$ |
||||||
|
|
|
|
|||||
Supplemental disclosure of non-cash investing and financing activities: |
||||||||
Offering costs paid through promissory note – related party |
$ | — | $ | |||||
|
|
|
|
|||||
Offering costs paid directly by Sponsor in consideration for the issuance of Class B common stock |
$ | — | $ | |||||
|
|
|
|
|||||
Deferred underwriting fee payable |
$ | $ | ||||||
|
|
|
|
Gross proceeds |
$ | |||
Less: |
||||
Proceeds allocated to Public Warrants |
$ | ( |
) | |
Class A common stock issuance costs |
( |
) | ||
Plus: |
||||
Accretion of carrying value to redemption value |
$ | |||
Class A common stock subject to possible redemption |
$ | |||
Year Ended December 31, 2021 |
For the Period from July 30, 2020 (Inception) through December 31, 2020 |
|||||||||||||||
Class A |
Class B |
Class A |
Class B |
|||||||||||||
Basic and diluted net loss per common stock |
||||||||||||||||
Numerator: |
||||||||||||||||
Allocation of net loss, as adjusted |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
Denominator: |
||||||||||||||||
Basic and diluted weighted average shares outstanding |
||||||||||||||||
Basic and diluted net loss per common stock |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) |
• | in whole and not in part; |
• | at a price of $ |
• | upon not less than |
• | if, and only if, the reported last sale price of the Company’s Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any |
December 31, 2021 |
For the Period from July 30, 2020 (Inception) through December 31, 2020 |
|||||||
Deferred tax asset |
||||||||
Net operating loss carryforward |
$ | $ | ||||||
Organizational costs/Startup expenses |
||||||||
|
|
|
|
|||||
Total deferred tax assets |
||||||||
Valuation allowance |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Deferred tax assets, net of allowance |
$ | $ | ||||||
|
|
|
|
December 31, 2021 |
For the Period from July 30, 2020 (Inception) through December 31, 2020 |
|||||||
Federal |
||||||||
Current |
$ | — | $ | — | ||||
Deferred |
( |
) | ( |
) | ||||
State |
||||||||
Current |
$ | — | $ | — | ||||
Deferred |
— | — | ||||||
Change in valuation allowance |
||||||||
|
|
|
|
|||||
Income tax provision |
$ | — | $ | — | ||||
|
|
|
|
December 31, 2021 |
For the Period from July 30, 2020 (Inception) through December 31, 2020 |
|||||||
Statutory federal income tax rate |
% | % | ||||||
State taxes, net of federal tax benefit |
% | % | ||||||
Change in fair value of warrants |
% | ( |
)% | |||||
Transaction costs |
% | ( |
)% | |||||
Change in valuation allowance |
( |
)% | ( |
)% | ||||
|
|
|
|
|||||
Income tax provision |
% | % | ||||||
|
|
|
|
Level 1: | Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. | |
Level 2: | Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. | |
Level 3: | Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. |
Description |
Level |
Amortized Cost |
Gross Holding Loss |
Fair Value |
||||||||||||||
December 31, 2020 |
Assets |
|||||||||||||||||
Held-to-Maturity |
1 | $ | $ | ( |
) | $ |
Description |
Level |
December 31, 2021 |
December 31, 2020 |
|||||||||
Assets: |
||||||||||||
Investments held in Trust Account – U.S. Treasury Securities Money Market Fund |
1 | $ | $ | — | ||||||||
Liabilities: |
||||||||||||
Warrant Liability – Public Warrants |
1 | $ | $ | |||||||||
Warrant Liability – Private Placement Warrants |
3 | $ | $ |
December 31, 2021 |
December 31, 2020 |
|||||||
Stock price |
$ | $ | ||||||
Strike price |
$ | $ | ||||||
Term (in years) |
||||||||
Volatility |
% | % | ||||||
Risk-free rate |
% | % | ||||||
Dividend yield |
% | % |
Private Placement |
||||
Fair value as of July 30, 2020 (inception) |
$ |
|||
Initial measurement on December 10, 2020 |
||||
Change in valuation inputs or other assumptions |
||||
Fair value as of December 31, 2020 |
||||
|
|
|
|
|
Change in fair value |
( |
) | ||
|
|
|||
Fair value as of December 31, 2021 |
$ |
|||
|
|
* | Filed herewith. |
** | Furnished herewith. |
(1) | Incorporated by reference to the Company’s Form S-1, originally filed with the SEC on October 9, 2020 (File No. 333-249402) and as thereafter amended. |
(2) | Incorporated by reference to the Company’s Form 8-K, filed with the SEC on December 11, 2020. |
(3) | Incorporated by reference to the Company’s Form 10-K, filed with the SEC on April 2, 2021. |
(4) | Incorporated by reference to the Company’s Form 10-K/A, filed with the SEC on April 6, 2021. |
(5) | Incorporated by reference to the Company’s Form 8-K, filed with the SEC on November 24, 2021. |
March 29, 2022 | MUDRICK CAPITAL ACQUISITION CORPORATION II | |||||
By: | /s/ Jason Mudrick | |||||
Name: | Jason Mudrick | |||||
Title: | Chief Executive Officer (Principal Executive Officer) |
Name |
Position |
Date | ||
/s/ Jason Mudrick |
Chief Executive Officer, President and Director | March 29, 2022 | ||
Jason Mudrick | (Principal Executive Officer) |
|||
/s/ Glenn Springer |
Chief Financial Officer | March 29, 2022 | ||
Glenn Springer | (Principal Financial and Accounting Officer) |
|||
/s/ David Kirsch |
Vice President and Director | March 29, 2022 | ||
David Kirsch | ||||
/s/ Dennis Stogsdill |
Director | March 29, 2022 | ||
Dennis Stogsdill | ||||
/s/ Scott Kasen |
Director | March 29, 2022 | ||
Scott Kasen | ||||
/s/ Dr. Brian Kushner |
Director | March 29, 2022 | ||
Dr. Brian Kushner |