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) |
(Commission File Number) |
(I.R.S. Employer Identification Number) |
(Address of principal executive offices) |
(Zip Code) |
Title of Each Class: |
Trading Symbol: |
Name of Each Exchange on Which Registered: | ||
stock and one-third of one redeemable warrant to purchase one share of Class A common stock |
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Large accelerated filer |
☐ |
Accelerated filer |
☐ | |||
☒ |
Smaller reporting company |
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Emerging growth company |
Auditor Firm ID: |
Auditor Name: |
Auditor Location: |
Page |
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CAUTIONORY NOTE REGARDING FORWRAD-LOOKING STATEMENTS |
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Item 1. |
1 |
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Item 1A. |
22 |
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Item 1B. |
54 |
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Item 2. |
54 |
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Item 3. |
54 |
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Item 4. |
54 |
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Item 5. |
55 |
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Item 6. |
56 |
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Item 7. |
57 |
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Item 7A. |
61 |
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Item 8. |
61 |
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Item 9. |
61 |
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Item 9A. |
62 |
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Item 9B. |
63 |
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Item 9C. |
63 |
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Item 10. |
64 |
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Item 11. |
71 |
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Item 12. |
72 |
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Item 13. |
73 |
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Item 14. |
76 |
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Item 15. |
78 |
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Item 16. |
79 |
• |
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 directors and officers allocating their time to other businesses and potentially having conflicts of interest with our business or in approving our initial business combination, as a result of which they would then receive expense reimbursements; |
• |
the proceeds of the forward purchase units being available to us; |
• |
our potential ability to obtain additional financing to complete our initial business combination; |
• |
our pool of prospective target businesses; |
• |
the ability of our directors and officers to generate a number of potential acquisition opportunities; |
• |
our public securities’ liquidity and trading; |
• |
the lack of a market for our securities; |
• |
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 following our initial public offering. |
ITEM 1. |
BUSINESS |
• | Mason Capital brings more than two decades of investment experience in the Advanced Industrials sector and as an active participant in public markets. |
• | ATS Automation is a key player in the automation industry and evaluates a significant number of potential transactions every year. |
• | extensive experience in both investing in and operating businesses in a variety of industries; |
• | managerial experience in growing businesses; |
• | experience in sourcing, structuring, acquiring, operating, developing, growing, financing and selling businesses; |
• | experience in executing transactions in a variety of industries under varying economic and financial market conditions; and |
• | deep relationships with customers, suppliers, current and former executives, directors and advisors of potential acquisition candidates. |
• | enabling new manufacturing and production processes that are cheaper, faster, more reliable, more flexible, safer and more sustainable; |
• | increasing automation to reduce labor costs, increase control, improve quality and enhance efficiency; |
• | improving the safety, productivity, management and efficiency of workers; |
• | optimizing supply chains to minimize cost, reduce risk, increase customer satisfaction and improve overall performance; |
• | reducing environmental impact, including through greater energy efficiency, decreased waste and more sustainable processes or materials; and |
• | offering “mission critical” products or solutions with a well-defined value proposition, for which price is not the primary customer decision-making criterion. |
• | have clearly identifiable and hard-to-replicate intellectual property, and engineering know-how, that is differentiated and highly defensible; |
• | have a proven ability and sufficient capacity to continue developing technologies and products to remain at the forefront of innovation and disruption; |
• | serve large, growing markets with the potential to gain significant market share; |
• | have a strong, highly defensible market position and persistent competitive advantages which create barriers to entry against new and existing competitors; |
• | are characterized by meaningful customer switching costs, making competitive displacement a difficult, costly, high risk and/or time-consuming undertaking; |
• | have a diversified customer and end market base or have the potential to develop a diversified customer and end market base; |
• | are positioned to endure economic downturns and changes in the industry environment that may occur, as well as evolving customer and supplier preferences; |
• | are at an inflection point where the additional management expertise and financial resources we provide can support or accelerate growth; |
• | have a clear path to achieving high revenue growth and attractive profitability and cash flows over the long-term; |
• | have a strong, experienced management team, or represent an effective platform to attract a strong management team; |
• | provide a platform for add-on acquisitions, which we believe represents an opportunity to deliver incremental stockholder value post-acquisition; |
• | offer an attractive risk-adjusted return for our stockholders, with potential upside from growth in the target business and an enhanced capital structure that will outweigh any identified downside risks; and |
• | can benefit from being a publicly traded company, are prepared to be a publicly traded company, and can utilize access to broader capital markets. |
• | 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 |
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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 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 (other than in a public offering); |
• | any of our directors, officers or substantial security holders (as defined by NYSE rules) has a 5% or greater interest, directly or indirectly, in the target business or assets to be acquired and the number of shares or common stock to be issued, or if the number of shares into which the securities may be convertible or exercisable, exceeds either (a) 1% of the number of shares of common stock or 1% of the voting power outstanding before the issuance in the case of any of our directors and officers or (b) 5% of the number of shares of common stock or 5% of the voting power outstanding before the issuance in the case of any substantial security holders; or |
• | the issuance or potential issuance of common stock will result in our undergoing a change of control. |
• | 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 our initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. |
• | 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. |
• | Our public stockholders may not be afforded an opportunity to vote on our proposed initial business combination, which means we may complete our initial business combination even though a majority of our public stockholders do not support such a combination. |
• | If we seek stockholder approval of our initial business combination, our initial stockholders have agreed to vote in favor of such initial business combination, regardless of how our public stockholders vote. |
• | Your only opportunity to affect the investment decision regarding a potential business combination will be limited to the exercise of your right to redeem your shares from us for cash, unless we seek stockholder approval of our initial business combination. |
• | The ability of our public stockholders to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for us to enter into a business combination with a target. |
• | The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination or optimize our capital structure. |
• | The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares could increase the probability that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your stock. |
• | The requirement that we complete our initial business combination within the prescribed time frame may give potential target businesses leverage over us in negotiating our initial business combination and may decrease our ability to conduct due diligence on potential business combination targets, in particular, as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms that would produce value for our public stockholders. |
• | We may not be able to complete our initial business combination within the prescribed time frame, in which case we would cease all operations except for the purpose of winding up and we would redeem our public shares and liquidate, in which case our public stockholders may only receive $10.00 per share, or less than such amount in certain circumstances, and our warrants will expire worthless. |
• | If a stockholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination, or fails to comply with the procedures for tendering its shares, such shares may not be redeemed. |
• | We are not required to obtain an opinion from an independent investment banking firm or from an independent accounting firm, and consequently, you may have no assurance from an independent source that the price we are paying for the business is fair to our company from a financial point of view. |
• | our independent registered public accounting firm’s report contains an explanatory paragraph that expresses substantial doubt about our ability to continue as a “going concern,” since we determined we may not have sufficient cash and working capital to meet our needs and we will cease all operations except for the purpose of liquidating if we are unable to complete an initial business combination by February 3, 2023. |
• | We may engage in an initial business combination with one or more target businesses that have relationships with entities that may be affiliated with our sponsor, officers, directors or existing holders which may raise potential conflicts of interest. |
• | We may only be able to complete one business combination with the proceeds of our initial public offering and the sale of the private placement warrants and forward purchase units, which will cause us to be solely dependent on a single business which may have a limited number of products or services and limited operating activities. This lack of diversification may negatively impact our operating results and profitability. |
• | Our directors and officers allocate their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our initial business combination. |
• | Certain of our directors and officers are now, and all of them may in the future become, affiliated with entities engaged in business activities similar to those intended to be conducted by us and, accordingly, may have conflicts of interest in allocating their time and determining to which entity a particular business opportunity should be presented. |
• | Since our sponsor, directors and officers will lose their entire investment in us if our initial business combination is not completed, a conflict of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination. |
• | Provisions in our amended and restated certificate of incorporation may limit our stockholders’ ability to obtain a favorable judicial forum. |
• | restrictions on the nature of our investments; and |
• | restrictions on the issuance of securities, each of which may make it difficult for us to complete our business combination. |
• | registration as an investment company; |
• | adoption of a specific form of corporate structure; and |
• | reporting, record keeping, voting, proxy and disclosure requirements and other rules and regulations. |
• | may significantly dilute the equity interest of our stockholders; |
• | may subordinate the rights of holders of common stock if preferred stock is issued with rights senior to those afforded our common stock; |
• | could cause a change of control if a substantial number of shares of our common stock are issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present directors and officers; and |
• | may adversely affect prevailing market prices for our units, Class A common stock and/or warrants. |
• | default and foreclosure on our assets if our operating revenues after our initial business combination are insufficient to repay our debt obligations; |
• | acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant; |
• | our immediate payment of all principal and accrued interest, if any, if the debt security is payable on demand; |
• | our inability to obtain necessary additional financing if the debt security contains covenants restricting our ability to obtain such financing while the debt security is outstanding; |
• | our inability to pay dividends on our common stock; |
• | using a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends on our common stock if declared, our ability to pay expenses, make capital expenditures and acquisitions, and fund other general corporate purposes; |
• | limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate; |
• | increased vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation; |
• | limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, and execution of our strategy; and |
• | other disadvantages compared to our competitors who have less debt. |
• | solely dependent upon the performance of a single business, property or asset, or |
• | dependent upon the development or market acceptance of a single or limited number of products, processes or services. |
• | the markets we may serve may be subject to general economic conditions and cyclical demand, which could lead to significant shifts in our results of operations from quarter to quarter that make it difficult to project long-term performance; |
• | fluctuations in customer demand; |
• | competition and consolidation of the specific sector of the industry within which the target business operates; |
• | volatility in costs for strategic raw material and energy commodities or disruption in the supply of these commodities could adversely affect our financial results; |
• | supplier stability, factory transitions and capacity constraints; |
• | inability to obtain necessary insurance coverage for the target business’ operations; |
• | additional expenses and delays due to technical problems, labor problems (including union disruptions) or other interruptions at our manufacturing facilities after our initial business combination; |
• | work-related accidents that may expose us to liability claims; |
• | our manufacturing processes and products not complying with applicable statutory and regulatory requirements, or if we manufacture products containing design or manufacturing defects, the demand for our products declining and potential liability claims; |
• | litigation and other proceedings, including that we may be liable for damages based on product liability claims, and we may also be exposed to potential indemnity claims from customers for losses due to our work or if our employees are injured performing services; |
• | warranty claims related to our products, and resulting reputational damage and incurrence of significant costs; |
• | changes in industry standards; |
• | changes in tariffs and other trade practices; |
• | inability to protect our intellectual property rights; |
• | our products and manufacturing processes being subject to technological change; |
• | being subject to applicable laws and regulations of federal, state and provincial governments, including environmental and health and safety laws and regulations, and the costs of compliance with such regulations; |
• | disruption or failure of networks, systems or technology as a result of computer viruses, “cyber-attacks,” misappropriation of data or other malfeasance, as well as outages, natural disasters, terrorist attacks, accidental releases of information or similar events; |
• | fluctuations in foreign currency exchange rates; and |
• | the failure of our customers to pay the amounts owed to us in a timely manner. |
• | higher costs and difficulties inherent in managing cross-border business operations and complying with different commercial and legal requirements of overseas markets; |
• | rules and regulations regarding currency redemption; |
• | complex corporate withholding taxes on individuals; |
• | laws governing the manner in which future business combinations may be effected; |
• | tariffs and trade barriers; |
• | regulations related to customs and import/export matters; |
• | longer payment cycles and challenges in collecting accounts receivable; |
• | tax issues, such as tax law changes and variations in tax laws as compared to the United States; |
• | currency fluctuations and exchange controls; |
• | rates of inflation; |
• | cultural and language differences; |
• | employment regulations; |
• | crime, strikes, riots, civil disturbances, terrorist attacks, natural disasters and wars; |
• | deterioration of political relations with the United States; and |
• | government appropriations of assets. |
• | a limited availability of market quotations for our securities; |
• | reduced liquidity for our securities; |
• | a determination that our Class A common stock is a “penny stock” which will require brokers trading in our Class A common stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities; |
• | a limited amount of news and analyst coverage; and |
• | a decreased ability to issue additional securities or obtain additional financing in the future. |
August 31, 2020 |
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Year Ended |
(inception) through |
|||||||||||
December 31, 2021 |
December 31, 2020 |
Change |
||||||||||
Net cash used in operating activities |
$ | (1,858,013 | ) | $ | (8,334 | ) | $ | (1,849,679 | ) | |||
Net cash used in investing activities |
$ | (500,000,000 | ) | $ | — | $ | (500,000,000 | ) | ||||
Net cash provided by financing activities |
$ | 502,666,182 | $ | 175,558 | $ | 502,490,624 |
• | We have expanded and improved our review process for complex securities and related accounting standards. |
• | We have increased communication among our personnel and third-party professionals with whom we consult regarding complex accounting applications. |
• | We have also retained the services of a valuation expert to assist in valuation analysis of the Warrants on a quarterly basis. |
• | We are establishing additional monitoring and oversight controls designed to ensure the accuracy and completeness of our financial statements and related disclosures. |
Name |
Age |
Position | ||
Edward A. Rose III | 60 | Chief Executive Officer and Director | ||
Derek Satzinger | 44 | Chief Financial Officer and Director | ||
Michael E. Martino | 58 | Chairman of the Board | ||
Philip B. Whitehead | 70 | Vice Chairman of the Board | ||
Diane M. Parisi | 63 | Director | ||
James L. Bauman | 62 | Director | ||
William B. Plummer | 63 | Director | ||
Marshall Clement “Mark” Sanford, Jr. | 61 | Director | ||
Pamela Chepiga | 72 | Director |
• | the appointment, compensation, retention, replacement, and oversight of the work of the independent auditors and any other independent registered public accounting firm engaged by us; |
• | pre-approving all audit and permitted non-audit services to be provided by the independent auditors or any other registered public accounting firm engaged by us, and establishing pre-approval policies and procedures; |
• | reviewing and discussing with the independent auditors all relationships the auditors have with us in order to evaluate their continued independence; |
• | setting clear hiring policies for employees or former employees of the independent auditors; |
• | 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 auditors describing (i) the independent auditor’s internal quality-control procedures and (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; |
• | 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 auditors, 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, 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 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. |
• | identifying, screening and reviewing individuals qualified to serve as directors and recommending to the board of directors candidates for nomination for election at the annual meeting of stockholders or to fill vacancies on the board of directors; |
• | developing, recommending to the board of directors and overseeing implementation of our corporate governance guidelines; |
• | coordinating and overseeing the annual self-evaluation of the board of directors, its committees, individual directors and management in the governance of the company; and |
• | reviewing on a regular basis our overall corporate governance and recommending improvements as and when necessary. |
• | None of our directors or officers is required to commit his or her full time to our affairs and, accordingly, may have conflicts of interest in allocating his or her time among various business activities. |
• | In the course of their other business activities, our directors and officers 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 their 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 within 24 months (or 30 months, as applicable) after the closing of our initial public offering. 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 last reported sale 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 |
• | Our directors and officers may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such directors and officers was included by a target business as a condition to any agreement with respect to our initial business combination. |
• | Our sponsor, directors or officers 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 directors or officers 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 $1.50 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 shares of common stock; |
• | each of our executive officers and directors; and |
• | all our executive officers and directors as a group. |
Class B common stock |
Class A common stock |
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Name of Beneficial Owners(1) |
Number of Shares Beneficially Owned (2) |
Approximate Percentage of Class |
Number of Shares Beneficially Owned |
Approximate Percentage of Class |
Approximate Percentage of Voting Control |
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Mason Industrial Sponsor, LLC (our sponsor) (3) |
12,190,625 | 97.53 | % | — | — | 19.5 | % | |||||||||||||
Glazer Capital, LLC (4) |
— | — | 3,208,316 | 6.42 | % | 5.13 | % | |||||||||||||
Adage Capital Partners, L.P. (5) |
— | — | 3,037,500 | 6.08 | % | 4.86 | % | |||||||||||||
Edward A. Rose III |
84,375 | * | — | — | * | |||||||||||||||
Derek Satzinger |
— | — | — | — | — | |||||||||||||||
Michael E. Martino (3) |
12,190,625 | 97.53 | % | — | — | — | ||||||||||||||
Philip B. Whitehead |
56,250 | * | — | — | — | |||||||||||||||
Diane M. Parisi |
56,250 | * | — | — | — | |||||||||||||||
James L. Bauman |
56,250 | * | — | — | — | |||||||||||||||
William B. Plummer |
56,250 | * | — | — | * | |||||||||||||||
Marshall Clement “Mark” Sanford, Jr |
— | — | — | — | * | |||||||||||||||
Pamela Chepiga |
— | — | — | — | * | |||||||||||||||
All officers and directors as a group (nine individuals) |
12,500,000 | 97.53 | % | 6,245,816 | 12.5 | % | 29.49 | % |
* | Less than one percent. |
(1) | Unless otherwise noted, the business address of our stockholders is c/o Mason Industrial Sponsor, LLC, 110 E. 59th Street, New York, NY 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 |
(3) | Mason Management LLC and Mason Capital Master Fund, LP are members of Mason Industrial Sponsor, LLC. Mason Management LLC is the managing member of our sponsor and an affiliate of Mason Capital Management LLC (“Mason Capital”). Michael E. Martino and Kenneth M. Garschina are the managing principals of Mason Capital Management LLC and the sole members of Mason Management LLC. Mason Capital Management LLC, Mr. Martino and Mr. Garschina may be deemed to have indirect voting and dispositive power over the foregoing shares held by Mason Industrial Sponsor, LLC. Each of Mason Management LLC, Mason Capital Master Fund, LP, Mason Capital Management LLC, Mr. Martino and Mr. Garschina disclaims beneficial ownership over any securities owned by our sponsor in which they do not have any pecuniary interest. |
(4) | Based on a Schedule 13G filed on February 14, 2022 by Glazer Capital, LLC, a Delaware limited liability company (“Glazer Capital”) and Paul J. Glazer, 110 East 59th Street, New York, NY. Glazer Capital may be deemed to be the beneficial owner of 3,208,316 Class A common stock, over which it has shared investment and voting power. |
(5) | Based on a Schedule 13G filed on February 10, 2022 by Adage Capital Partners, L.P., a Delaware limited partnership (“Adage Capital”), Adage Capital Partners GP, L.L.C., Adage Capital Advisors, L.L.C., Robert Atchinson and Phillip Gross, 200 Clarendon Street, 52nd Floor, Boston, Massachusetts 02116. Adage Capital may be deemed to be the beneficial owner of 3,037,500 Class A common stock, over which it has shared investment and voting power. |
ITEM 15. |
EXHIBIT AND FINANCIAL STATEMENT SCHEDULES |
101.INS* | Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded in the Inline XBRL document. | |
101.CAL* | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
101.SCH* | Inline XBRL Taxonomy Extension Schema Document | |
101.DEF* | Inline XBRL Taxonomy Extension Definition Linkbase Document | |
101.LAB* | Inline XBRL Taxonomy Extension Labels Linkbase Document | |
101.PRE* | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
104* | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) |
* | Filed herewith. |
(1) | Incorporated by reference to the registrant’s Registration Statement on Form S-1, filed with the SEC on January 12, 2021. |
(2) | Incorporated by reference to the registrant’s Current Report on Form 8-K, filed with the SEC on February 2, 2021. |
MASON INDUSTRIAL TECHNOLOGY, INC. | ||
/s/ Edward A. Rose III | ||
Name: | Edward A. Rose III | |
Title: | Chief Executive Officer and Director |
Name |
Position |
Date | ||
/s/ Edward A. Rose III Edward A. Rose III |
Chief Executive Officer and Director (Principal Executive Officer) |
March 30, 2022 | ||
/s/ Derek Satzinger Derek Satzinger |
Chief Financial Officer and Director (Principal Financial Officer) |
March 30, 2022 | ||
/s/ Michael E. Martino Michael E. Martino |
Chairman of the Board | March 30, 2022 | ||
/s/ Philip B. Whitehead Philip B. Whitehead |
Vice Chairman of the Board | March 30, 2022 | ||
/s/ Diane M. Parisi Diane M. Parisi |
Director | March 30, 2022 | ||
/s/ James L. Bauman James L. Bauman |
Director | March 30, 2022 | ||
/s/ William B. Plummer William B. Plummer |
Director | March 30, 2022 | ||
/s/ Marshall Clement Sanford, Jr. Marshall Clement Sanford, Jr. |
Director | March 30, 2022 | ||
/s/ Pamela Chepiga Pamela Chepiga |
Director | March 30, 2022 |
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December 31, |
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2020 |
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ASSETS |
||||||||
CURRENT ASSETS |
||||||||
Cash |
$ | $ | ||||||
Prepaid expenses |
— | |||||||
|
|
|
|
|||||
Total current assets |
||||||||
NONCURRENT ASSETS |
||||||||
Cash held in trust account |
— | |||||||
Other assets |
— | |||||||
Derivative forward purchase agreement |
— | |||||||
Deferred offering costs |
|
|
— |
|
|
|
|
|
|
|
|
|
|||||
Total noncurrent assets |
||||||||
|
|
|
|
|||||
TOTAL ASSETS |
$ | $ | ||||||
|
|
|
|
|||||
LIABILITIES, REDEEMABLE COMMON STOCK AND STOCKHOLDERS’ DEFICIT |
||||||||
CURRENT LIABILTIES |
||||||||
Accounts payable and accrued expenses |
$ | $ | ||||||
Accrued deferred offering costs |
— | |||||||
Franchise tax payable |
— | |||||||
Note payable – related party |
— | |||||||
|
|
|
|
|||||
Total current liabilities |
||||||||
LONG-TERM LIABILTIES |
||||||||
Deferred underwriting commissions |
— | |||||||
Derivative liabilities |
— | |||||||
|
|
|
|
|||||
Total liabilities |
||||||||
Commitments and Contingencies |
||||||||
Class A common stock subject to possible redemption; December 31, 2020, respectively, at redemption value of $ |
— | |||||||
STOCKHOLDERS’ DEFICIT |
||||||||
Preferred stock, $ 2021 and December 31, 2020, respectively |
— | |||||||
Class A common stock, $ (excluding 2020, respectively |
— | |||||||
Class B common stock, $ and outstanding as of December 31, 2021 and December 31, 2020, respectively (1) |
||||||||
Additional paid-in capital |
— | |||||||
Accumulated deficit |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Total Stockholders’ Deficit |
( |
) | ( |
) | ||||
|
|
|
|
|||||
TOTAL LIABILITIES, REDEEMABLE COMMON STOCK AND STOCKHOLDERS’ DEFICIT |
$ | $ | ||||||
|
|
|
|
(1) | As of December 31, 2020, this number includes up to |
August 31, 2020 |
||||||||
Year Ended |
(inception) through |
|||||||
December 31, 2021 |
December 31, 2020 |
|||||||
OPERATING EXPENSES |
||||||||
General and administrative expenses |
$ | $ | ||||||
Franchise tax expense |
||||||||
|
|
|
|
|||||
Total operating expenses |
||||||||
|
|
|
|
|||||
OTHER INCOME (EXPENSE) |
||||||||
Interest income on marketable securities held in Trust Account |
||||||||
Underwriting discounts and offering costs attributed to derivative liabilities |
( |
) | ||||||
Change in fair value of derivative liabilities |
||||||||
Change in fair value of derivative forward purchase agreement |
||||||||
|
|
|
|
|||||
Total other income |
||||||||
|
|
|
|
|||||
INCOME (LOSS) BEFORE INCOME TAX |
( |
) | ||||||
Income tax expense (benefit) |
||||||||
|
|
|
|
|||||
NET INCOME (LOSS) |
$ | $ | ( |
) | ||||
|
|
|
|
|||||
Basic and diluted weighted average shares outstanding, Class A common stock |
||||||||
Basic and diluted net income (loss) per share, Class A common stock |
$ | $ | ||||||
Basic and diluted weighted average shares outstanding, Class B common stock (1) |
||||||||
Basic and diluted net income (loss) per share, Class B common stock |
$ | $ | ( |
) |
(1) | The weighted average shares outstanding for the period from August 31, 2020 (inception) through December 31, 2020 excludes an aggregate of up to |
Class B Common Stock |
Additional Paid-in |
Accumulated |
Total Stockholders’ |
|||||||||||||||||
Shares |
Amount |
Capital |
Deficit |
Deficit |
||||||||||||||||
Balance—August 31, 2020 (inception) |
$ | $ | $ | $ | ||||||||||||||||
Issuance of Class B stock to Sponsor (1) |
— | |||||||||||||||||||
Net loss |
— | — | ( |
) | ( |
) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balance—December 31, 2020 |
( |
) | ( |
) | ||||||||||||||||
Forfeiture of Founder Shares(2) |
( |
) | ( |
) | — | — | ||||||||||||||
Initial classification of derivative forward purchase agreement |
— | — | ( |
) | — | ( |
) | |||||||||||||
Remeasurement of Class A common stock subject to possible redemption |
— | — | ( |
) | ( |
) | ||||||||||||||
Net income |
— | — | — | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balance—December 31, 2021 |
$ | $ | $ | ( |
) | $ | ( |
) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
(1) | This number includes an aggregate of up to |
(2) | On January 29, 2021 the Sponsor forfeited |
August 31, 2020 |
||||||||
Year Ended |
(inception) through |
|||||||
December 31, 2021 |
December 31, 2020 |
|||||||
CASH FLOWS FROM OPERATING ACTIVITIES |
||||||||
Net income (loss) |
$ | $ | ( |
) | ||||
Adjustments to reconcile net income (loss) to net cash used in operating activities: |
||||||||
Interest earned on cash held in Trust Account |
( |
) | ||||||
Underwriting discounts and transaction costs attributed to warrant liability |
— | |||||||
Change in fair value of derivative liabilities |
( |
) | — | |||||
Change in fair value of derivative forward purchase agreement |
( |
) | — | |||||
Changes in operating assets and liabilities: |
— | |||||||
Prepaid expenses |
( |
) | — | |||||
Accounts payable and accrued expenses |
||||||||
Other assets |
( |
) | — | |||||
Franchise tax payable |
— | |||||||
|
|
|
|
|||||
Net cash used in operating activities |
( |
) | ( |
) | ||||
|
|
|
|
|||||
CASH FLOWS FROM INVESTING ACTIVITIES |
||||||||
Investment of cash in Trust Account |
( |
) | — | |||||
|
|
|
|
|||||
Net cash used in investing activities |
( |
) | — | |||||
|
|
|
|
|||||
CASH FLOW FROM FINANCING ACTIVITIES |
||||||||
Proceeds from sale of Units, net of underwriting discounts paid |
— | |||||||
Proceeds from sale of Private Placement Warrants |
— | |||||||
Repayment of note payable – related party |
( |
) | — | |||||
Payment of offering costs |
( |
) | ||||||
Proceeds from sale of Class B common stock |
— | |||||||
Proceeds from issuance of note payable – related party |
— | |||||||
|
|
|
|
|||||
Net cash provided by financing activities |
||||||||
|
|
|
|
|||||
NET CHANGE IN CASH |
||||||||
CASH, BEGINNING OF PERIOD |
— | |||||||
|
|
|
|
|||||
CASH, END OF PERIOD |
$ | $ | ||||||
|
|
|
|
|||||
SUPPLEMENTAL DISCLOSURES OF NONCASH ACTIVITIES |
||||||||
Initial classification of derivative liabilities |
$ | $ | — | |||||
Initial classification of derivative forward purchase agreement |
$ | ( |
) | $ | — | |||
Initial classification value of common stock subject to possible redemption |
$ | $ | — | |||||
Remeasurement of Class A common stock subject to possible redemption |
$ | $ |
— | |||||
Deferred underwriting fees charged to additional paid-in capital |
$ | $ | — | |||||
Deferred offering costs included in accrued deferred offering costs |
$ | $ |
Fair Value Measured as of December 31, 2021 |
||||||||||||
Level 1 |
Level 2 |
Level 3 |
||||||||||
Assets: |
||||||||||||
Investments held in Trust Account (1) |
$ |
$ |
— |
$ |
— |
|||||||
Derivative forward purchase agreements (2) |
$ |
— |
$ |
— |
$ |
|||||||
Liabilities: |
||||||||||||
Derivative liabilities — Public Warrants (3) |
$ |
$ |
— |
$ |
— |
|||||||
Derivative liabilities — Private Placement Warrants (4) |
$ |
— |
$ |
— |
$ |
(1) | The fair value of investments in Trust Account based on quoted market price. |
(2) | The fair value of derivative forward purchase agreement was based on the forward price formula. |
(3) | The fair value of derivative liabilities – Public Warrants based on quoted market price for MIT.W as of the reporting date. |
(4) | The fair value of derivative liabilities – Private Placement Warrants was based on a modified Black-Scholes model. |
February 2, 2021 |
||||
(Initial Measurement) |
||||
Strike price |
$ | |||
Term (in years) |
||||
Risk-free rate |
% | |||
Volatility |
% | |||
Dividend Yield |
% | |||
Fair value of Public Warrants |
$ | |||
Fair value of Private Placement Warrants |
$ |
December 31, 2021 |
||||
Strike price |
$ | |||
Term (in years) |
||||
Risk-free rate |
% | |||
Volatility |
% | |||
Dividend yield |
% | |||
Fair value of Private Placement Warrants |
$ |
• |
Term – the expected life of the warrants was assumed to be equivalent of their remaining contractual term. |
• |
Risk-free rate – the risk-free interest rate is based on the U.S. Treasury yield curve in effect on the date of valuation equal to the remaining expected life of the warrants. |
• |
Volatility – the Company estimated the volatility of its common stock warrants based on the implied volatility of the Company’s own publicly traded warrants. |
• |
Dividend yield – the dividend yield percentage is zero because the Company does not currently pay dividends, nor does it intend to do so during the expected term of private placement warrants. |
February 2, 2021 (Initial Measurement) |
||||
Stock price |
$ |
|||
Exercise price |
$ |
|||
Term (years) |
||||
Risk free rate |
% | |||
Volatility |
% | |||
Dividend Yield |
% | |||
Fair value of over-allotment option |
$ |
• |
Stock price – the stock price was assumed to be equivalent to the offering price. |
• |
Exercise price – the exercise price was assumed to be the price the underwriters would pay to purchase additional units from the Company. |
• |
Term – the expected life of the Over-allotment options was assumed to be equivalent of their remaining contractual term. |
• |
Risk-free rate – the risk-free interest rate is based on the U.S. Treasury yield curve in effect on the date of valuation equal to the remaining expected life of the warrants. |
• |
Volatility – the Company estimated the volatility of its common stock warrants based on the implied volatility of the Company’s own publicly traded warrants. |
• |
Dividend yield – the dividend yield percentage is zero because the Company does not currently pay dividends. |
Public Warrants |
Private Warrants |
Over-allotment Option |
Total Derivative Liability |
|||||||||||||
Derivative warrant liabilities at |
$ | $ | |
$ |
|
|
$ | |||||||||
Issuance of Public and Private Warrants |
|
|
|
|
||||||||||||
Issuance of over-allotment option |
||||||||||||||||
Partial exercise of over-allotment option |
( |
) | ( |
) | ||||||||||||
Change in fair value of derivative |
( |
) | ( |
) | |
|
( |
) |
( |
) | ||||||
|
|
|
|
|
|
|
|
|
|
|||||||
Derivative liabilities at December 31, |
$ | $ | |
$ |
|
|
$ |
(1) | During the 1 st quarter of 2021, the Public Warrants were transferred from Level 3 to Level 1 in the fair value hierarchy. |
(2) |
On February 2, 2021, the IPO date, the over-allotment option was partially exercised for the purchase of |
FPA Asset (Liability) |
||||
Derivative forward purchase agreement at December 31, 2020 |
$ | |||
Executed forward purchase agreement in connection with IPO |
( |
) | ||
Change in fair value of the derivative forward purchase agreement |
||||
|
|
|||
Derivative forward purchase agreement at December 31, 2021 |
$ |
• | in whole and not in part; |
• | at a price of $ |
• | at any time during the exercise period; |
• | upon a minimum of |
• | if, and only if, the last sale price of the Company’s Class A common stock equals or exceeds $ |
• | If, and only if, there is a current registration statement in effect with respect to the shares of Class A common stock underlying such warrants. |
• |
in whole and not in part; |
• |
at $ |
• |
upon not less than |
• |
if, and only if, the closing price of Class A common stock equals or exceeds $ |
Gross proceeds |
$ | |||
Less: |
||||
Offering costs and underwriting fees allocated to Class A common stock subject to possible redemption |
( |
) | ||
Proceeds allocated to Public Warrants at issuance |
( |
) | ||
Plus: |
||||
Remeasurement to Class A common stock subject to possible redemption |
||||
Class A common stock subject to possible redemption |
$ | |||
August 31, 2020 |
||||||||
Year Ended |
(inception) through |
|||||||
December 31, 2021 |
December 31, 2020 |
|||||||
Current income tax expense: |
||||||||
Federal |
$ | $ | ||||||
State |
||||||||
Deferred income tax expense: |
||||||||
Federal |
$ | ( |
) | ( |
) | |||
State |
||||||||
( |
) |
( |
) | |||||
Change in valuation allowance |
||||||||
Income tax provision |
$ |
$ |
||||||
December 31, |
||||||||
2021 |
2020 |
|||||||
Statutory federal income tax rate |
% | % | ||||||
Change in fair value of derivative liabilities |
( |
)% | % | |||||
Change in fair value of FPA |
( |
)% | % | |||||
Transaction costs related to warrants |
% | % | ||||||
Meals and entertainment |
|
|
|
% |
|
|
|
% |
Return to provision adjustment |
|
|
( |
)% |
|
|
|
% |
Change in valuation allowance |
% | ( |
)% | |||||
|
|
|
|
|||||
Income tax provision |
% | % | ||||||
|
|
|
|
December 31, |
||||||||
2021 |
2020 |
|||||||
Deferred tax asset |
||||||||
Net operating loss carryforward |
$ | $ | ||||||
Organizational/Start-up costs |
||||||||
|
|
|
|
|||||
Total deferred tax asset |
||||||||
Valuation allowance |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Deferred tax asset, net of allowance |
$ | $ | ||||||
|
|
|
|
August 31, 2020 |
||||||||||||||||
Year Ended |
(inception) through |
|||||||||||||||
December 31, 2021 |
December 31, 2020 |
|||||||||||||||
Class A |
Class B |
Class A |
Class B |
|||||||||||||
Basic and diluted net income (loss) per share |
||||||||||||||||
Numerator |
||||||||||||||||
Allocation of net income (loss) |
$ |
$ |
$ |
$ |
( |
) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Denominator |
||||||||||||||||
Weighted-average shares outstanding (1) |
||||||||||||||||
Basic and diluted net income (loss) per share |
$ |
$ |
$ |
$ |
( |
) |
(1) | The weighted average shares outstanding for the period from August 31, 2020 (inception) through December 31, 2020 excludes an aggregate of up to |