☒ |
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) |
(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: | ||
one-half of one warrant |
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Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
Non-accelerated filer |
☒ | Smaller reporting company | ||||
Emerging growth company |
Auditor Firm ID: |
Auditor Name: |
Auditor Location: |
PAGE |
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3 |
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Item 1. |
3 |
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Item 1A. |
22 |
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Item 1B. |
58 |
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Item 2. |
58 |
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Item 3. |
58 |
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Item 4. |
58 |
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58 |
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Item 5. |
58 |
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Item 6. |
59 |
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Item 7. |
59 |
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Item 7A. |
65 |
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Item 8. |
65 |
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Item 9. |
65 |
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Item 9A. |
65 |
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Item 9B. |
66 |
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Item 9C. |
66 |
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66 |
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Item 10. |
66 |
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Item 11. |
72 |
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Item 13. |
74 |
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Item 14 . |
75 |
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76 |
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Item 15. |
76 |
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Item 16. |
Form 10-K Summary | 76 |
• | “we,” “us,” “company” or “our company” are to Flame Acquisition Corp.; |
• | “Board” refers to our board of directors; |
• | “common stock” are to our Class A common stock and our Class B common stock, collectively; |
• | “equity-linked securities” are to are to any securities of our company which are convertible into or exchangeable or exercisable for, shares of Class A common stock of our company, issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of equity or debt; |
• | “FL Co-Investment” are to FL Co-Investment LLC, an affiliate of Cowen and Company, LLC; |
• | “founders” are to our sponsor, FL Co-Investment LLC and Intrepid Financial Partners; |
• | “founder shares” are to shares of our Class B common stock initially purchased by our founders in a private placement prior to our initial public offering, and the shares of our Class A common stock issued upon the conversion thereof as provided herein; |
• | “initial stockholders” are to our founders and any other holders of our founder shares prior to our initial public offering; |
• | “Intrepid Financial Partners” are to Intrepid Financial Partners, L.L.C., an affiliate of Intrepid Partners, LLC; |
• | “management” or our “management team” refers to our officers; |
• | “private placement warrants” are to the warrants issued to our initial stockholders 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 were purchased in the 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, Board to the extent any of them purchases public shares, provided that each such initial stockholder’s and individual’s status as a “public stockholder” shall only exist with respect to such public shares; |
• | “public warrants” are to our warrants sold as part of the units in our initial public offering (whether they were purchased in our initial public offering or thereafter in the open market) and to any private placement warrants or warrants issued upon conversion of working capital loans that are sold to third parties that are not initial purchasers or officers or directors (or permitted transferees) following the consummation of our initial business combination; |
• | “specified future issuance” are to an issuance of a class of equity or equity-linked securities to specified purchasers that we may determine to make in connection with financing our initial business combination; |
• | “sponsor” are to Flame Acquisition Sponsor LLC, a Delaware limited liability company; |
• | “units” are the units sold in our initial public offering (whether they were purchased in our initial public offering or thereafter in the open market) and the units sold upon the underwriters’ exercise of their over-allotment option; and |
• | “warrants” are to our warrants, which includes the public warrants as well as the private placement warrants. |
• | our ability to select an appropriate target business or businesses and complete our initial business combination; |
• | our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business combination; |
• | our ability to consummate an initial business combination due to the continued uncertainty resulting from the COVID-19 pandemic; |
• | 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 investment opportunities; |
• | our public securities’ potential 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 |
• | Attractive Returns |
• | Significant Free Cash Flow |
• | Low Risk Development Upside |
• | High Operational Control |
• | Conservative Leverage Profile |
• | Bolt-on Acquisition Opportunitiesfollow-on acquisition opportunities that allow us to leverage its initial operating platform and realize operating and financial synergies associated with consolidation. |
• | Access to Infrastructure and End Markets |
• | Health, Safety and Environmental Stewardship |
• | an established track record of building industry-leading companies; |
• | growing companies with accretive acquisitions under various market conditions by leveraging our extensive deal-sourcing network and employing our proven transaction execution/structuring capabilities; |
• | deploying value creation strategies, including delivering operating efficiencies through balanced cost reduction and production growth and allocating capital spending to high-return opportunities; and |
• | extensive capital markets experience across various business cycles, including financing businesses and assisting companies with transition to public ownership. |
• | Strong Core Industry Fundamentals COVID-19 pandemic by reducing growth capital spending. Natural gas is also viewed as a bridge fuel to more sustainable and environmentally-friendly forms of electricity generation. The United States has recently become a global leader in natural gas resource development and is a growing LNG exporter. We believe investors have fundamentally changed their investment criteria for the E&P industry from high production growth targets to disciplined growth, focusing primarily on total returns and returns of cash to investors. |
• | Large Target Market start-ups to large corporations. Many non-investment grade companies have struggled with excess leverage and have been forced to restructure their operations. Other companies have looked to reduce their leverage through asset sales. Historically, the E&P industry has used asset sales as one of its key funding sources for capital spending. The absence of capital availability and an active M&A market to raise vital cash proceeds leads us to believe that many public and private companies currently lack the financial health and operating capabilities to succeed in this environment. |
• | Lack of Competition |
• | Management Experience Through Cycles Required to Succeed |
• | 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 may 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 (a) equal to or in excess of 20% of the number of shares of our Class A common stock then outstanding or (b) have voting power equal to or in excess of 20% of the voting power then outstanding; |
• | any of our directors, officers or substantial security holders (as defined by the NYSE rules) has a 5% 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 stock or voting power of 1% or more (or 5% or more if the related party involved is classified as such solely because such person is a substantial security holder); or |
• | the issuance or potential issuance of common stock will result in our undergoing a change of control. |
• | the timing of the transaction, including in the event we determine stockholder approval would require additional time and there is either not enough time to seek stockholder approval or doing so would place the company at a disadvantage in the transaction or result in other additional burdens on the company; |
• | the expected cost of holding a stockholder vote; |
• | the risk that the stockholders would fail to approve the proposed business combination; |
• | other time and budget constraints of the company; and |
• | additional legal complexities of a proposed business combination that would be time-consuming and burdensome to present to stockholders. |
• | 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 that 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. |
• | 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. |
Item 1A. |
Risk Factors |
• | 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. |
• | 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 initial 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. |
• | volatility of oil and natural gas prices; |
• | price and availability of alternative fuels, such as solar, coal, nuclear and wind energy; |
• | significant federal, state and local regulation, taxation and regulatory approval processes as well as changes in applicable legislation, laws and regulations; |
• | denial or delay of receiving requisite regulatory approvals and/or permits; |
• | the speculative nature of and high degree of risk involved in investments in the upstream, midstream and energy services sectors, including relying on estimates of oil and gas reserves and the impacts of regulatory and tax changes; |
• | exploration and development risks, which could lead to environmental damage, injury and loss of life or the destruction of property; |
• | drilling, exploration and development risks, including encountering unexpected formations or pressures, premature declines of reservoirs, blow-outs, equipment failures and other accidents, cratering, sour gas releases, uncontrollable flows of oil, natural gas or well fluids, adverse weather conditions, pollution, fires, spills and other environmental risks, any of which could lead to environmental damage, injury and loss of life or the destruction of property; |
• | proximity and capacity of oil, natural gas and other transportation and support infrastructure to production facilities; |
• | availability of key inputs, such as strategic consumables and raw materials and drilling and processing equipment; |
• | available pipeline, storage and other transportation capacity; |
• | changes in global supply and demand and prices for commodities; |
• | impact of energy conservation efforts; |
• | technological advances affecting energy production and consumption; |
• | overall domestic and global economic conditions; |
• | availability of, and potential disputes with, independent contractors; |
• | global warming, adverse weather conditions, natural disasters or other events (such as equipment malfunctions, explosions, fires or spills); |
• | value of U.S. dollar relative to the currencies of other countries; and |
• | terrorist acts. |
• | may significantly dilute the equity interest of our investors, which dilution would increase if the anti-dilution provisions in the Class B common stock resulted in the issuance of shares of Class A common stock on a greater than one-to-one |
• | 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 is 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 officers and directors; |
• | may have the effect of delaying or preventing a change of control of us by diluting the stock ownership or voting rights of a person seeking to obtain control of us; |
• | may adversely affect prevailing market prices for our units, Class A common stock and/or warrants; and |
• | may not result in adjustment to the exercise price of our warrants. |
• | default and foreclosure on our assets if our operating revenues after an 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. |
• | 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; |
• | changes in local regulations as part of a response to the COVID-19 outbreak; |
• | 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, price instability and interest rate fluctuations; |
• | 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. |
Item 1B. |
Unresolved Staff Comments |
Item 2. |
Properties |
Item 3. |
Legal Proceedings |
Item 4. |
Mine Safety Disclosures |
Item 5. |
Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities Market Information |
Item 6. |
[Reserved] |
Item 7. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
Item 7A. |
Quantitative and Qualitative Disclosures about Market Risk |
Item 8. |
Financial Statements and Supplementary Data |
Item 9. |
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. |
Item 9A. |
Controls and Procedures. |
Item 9B. |
Other Information |
Item 9C. |
Disclosures Regarding Foreign Jurisdictions that Prevent Inspections |
Item 10. |
Directors, Executive Officers and Corporate Governance |
Directors |
and Executive Officers |
Name |
Age |
Position | ||
James C. Flores |
62 | Chairman, Chief Executive Officer and President | ||
Gregory D. Patrinely |
36 | Chief Financial Officer and Secretary | ||
Michael E. Dillard |
63 | Director | ||
Gregory P. Pipkin |
62 | Director | ||
Christopher B. Sarofim |
58 | 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 corporate goals and objectives relevant to our Chief Executive Officer’s compensation, evaluating our Chief Executive Officer’s performance in light of those goals and objectives, and setting our Chief Executive Officer’s compensation level based on this 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 and 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, consistent with criteria approved by the Board, and recommending to the Board candidates for nomination for appointment at the annual general meeting or to fill vacancies on the Board; |
• | developing and recommending to the Board and overseeing implementation of our corporate governance guidelines; |
• | coordinating and overseeing the annual self-evaluation of the Board, 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. |
Item 11. |
Executive Compensation |
Item 12. |
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
• | each person known by us to be the beneficial owner of more than 5% of our outstanding shares of common stock; |
• | each of our officers and directors that beneficially owns shares of our common stock; and |
• | all our 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(2)(3) |
Approximate Percentage of Class |
Percentage of Outstanding Common Stock |
|||||||||||||||
Flame Acquisition Sponsor LLC(4) |
— | — | 4,263,750 | 59.3 | % | 11.9 | % | |||||||||||||
James C. Flores(4) |
— | — | 4,263,750 | 59.3 | % | 11.9 | % | |||||||||||||
Entities affiliated with Saba Capital Management, L.P.(5) |
1,602,328 | 5.6 | % | — | — | 4.5 | % | |||||||||||||
Entities affiliated with Sculptor Capital LP(6) |
1,482,989 | 5.2 | % | — | — | 4.1 | % | |||||||||||||
Gregory D. Patrinely |
— | — | 71,875 | 1.0 | % | * | ||||||||||||||
Michael E. Dillard |
5,000 | * | 96,875 | 1.3 | % | * | ||||||||||||||
Gregory P. Pipkin |
15,000 | * | 96,875 | 1.3 | % | * | ||||||||||||||
Christopher B. Sarofim |
500,000 | 1.7 | % | 96,875 | 1.3 | % | 1.7 | % | ||||||||||||
All officers and directors as a group (five individuals) |
520,000 | 1.8 | % | 4,626,250 | 64.4 | % | 14.3 | % |
* | less than 1% |
1) | Unless otherwise noted, the business address of each of the following entities or individuals is c/o Flame Acquisition Corp., 700 Milam Street, Suite 3300, Houston, Texas 77002. |
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 |
3) | Does not include 71,875 shares held independently. |
4) | Flame Acquisition Sponsor LLC is the record holder of the shares reported herein. James C. Flores is the managing member of Flame Acquisition Sponsor LLC. As such, Mr. Flores may be deemed to have beneficial ownership of the Class B common stock held directly by Flame Acquisition Sponsor LLC. Mr. Flores disclaims beneficial ownership of the reported shares other than to the extent of any pecuniary interest he may have therein, directly or indirectly. |
5) | Based solely on information contained in a report on Schedule 13G filed on February 14, 2022 by Saba Capital Management, L.P., Saba Capital Management GP, LLC and Mr. Boaz R. Weinstein (together, the “Reporting Persons”). Each of the Reporting Persons may be deemed the beneficial owner of 1,602,328 shares of the Company’s Class A common stock. The principal business address of each of the Reporting Persons is 405 Lexington Avenue, 58th Floor, New York, New York 10174. |
6) | Based solely on information contained in a report on Schedule 13G filed on January 28, 2022 by entities affiliated with Sculptor Capital LP. Includes (i) 1,482,989 shares of Class A common stock (“Shares”) beneficially owned by each of Sculptor Capital LP (“Sculptor”), Sculptor Capital II LP (“Sculptor-II”), Sculptor Capital Holding Corp. (“SCHC”), Sculptor Capital Holding II LLC (“SCHC-II”) and Sculptor Capital Management, Inc. (“SCU”), (ii) 754,007 Shares beneficially owned by each of Sculptor Master Fund, Ltd. (“SCMF”) and Sculptor Special Funding, LP (“NRMD”), (iii) 132,448 Shares beneficially owned by Sculptor Credit Opportunities Master Fund, Ltd. (“SCCO”), (iv) 483,044 Shares beneficially owned by Sculptor SC II LP (“NJGC”), and (v) 113,490 Shares beneficially owned by Sculptor Enhanced Master Fund, Ltd. (“SCEN”). Sculptor and Sculptor-II serve as the principal investment managers to the private funds and discretionary accounts managed by Sculptor and thus may be deemed beneficial owners of the Shares in the private funds and discretionary accounts managed by Sculptor and Sculptor-II. SCHC-II serves as the sole general partner of Sculptor-II and is wholly owned by Sculptor. SCHC serves as the sole general partner of Sculptor. As such, SCHC and SCHC-II may be deemed to control Sculptor as well as Sculptor-II and, therefore, may be deemed to be the beneficial owners of the Shares reported herein. SCU is the sole shareholder of SCHC, and may be deemed a beneficial owner of the Shares reported herein. The principal business address of each of Sculptor, Sculptor-II, SCHC, SCHC-II, SCU, SCMF, NRMD, SCEN, SCCO and NJGC is 9 West 57th Street, New York, NY 10019. |
Item 13. |
Certain Relationships and Related Transactions, and Director Independence |
Item 14 . |
Principal Accountant Fees and Services. |
Item 15. |
Exhibits, Financial Statements and Financial Statement Schedules |
(a) | The following documents are filed as part of this Report: |
(1) | Financial Statements |
(2) | Financial Statements Schedule |
(3) | Exhibits |
Item 16. |
Form 10-K Summary |
None. |
F-2 |
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Financial Statements: |
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F-3 |
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F-4 |
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F-5 |
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F-6 |
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F-7 |
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F-8 |
December 31, 2021 |
December 31, 2020 |
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Assets |
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Current assets: |
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Cash |
$ | $ | ||||||
Prepaid expenses |
— | |||||||
Deferred offering costs associated with IPO |
— | |||||||
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Total current assets |
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Prepaid expenses –Non-Current |
— | |||||||
Investment held in Trust Account |
— | |||||||
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Total assets |
$ | $ | ||||||
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Liabilities and Stockholders’ (Deficit) Equity |
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Current liabilities: |
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Accounts payable and accrued expenses |
$ | $ | ||||||
Convertible promissory notes to Related Parties, at fair valu e |
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Total current liabilities |
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Warrant Liabilities |
— | |||||||
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Total liabilities |
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Commitments |
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Class A Common stock subject to possible redemption, |
— | |||||||
Stockholders’ (deficit) equity: |
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Preferred stock, $ |
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Class A common stock, $ , at December 31excluding 0 and , 2021 and 2020, respectively |
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Class B common stock, $ |
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Additional paid-in capital |
— | |||||||
Accumulated deficit |
( |
) |
( |
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Total stockholders’ (deficit) equity |
( |
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Total liabilities and stockholders’ (deficit) equity |
$ | $ | ||||||
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For the Year Ended December 31, 2021 |
From the Period from October 16, 2020 (inception) Through December 31, 2020 |
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Formation and operating costs |
$ | $ | ||||||
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Loss from operations |
( |
) | ( |
) | ||||
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Other income (expense): |
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Interest income from Trust Account |
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Initial fair value adjustment of promissory note |
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( |
) |
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Change in fair value of promissory note |
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Change in fair value of warrant liabilities |
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Offering costs allocated to warrants |
( |
) | ||||||
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Total other income, net |
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Net Income |
$ | $ | ( |
) | ||||
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Weighted average shares outstanding, redeemable Class A common stock |
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Basic and diluted net income per share, redeemable Class A common stock |
$ | $ | ||||||
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Weighted average shares outstanding, non-redeemable common stock |
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Basic and diluted net income per share, non-redeemable common stock |
$ | $ | ( |
) | ||||
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Common Stock |
Additional Paid-In Capital |
Accumulated Deficit |
Total Stockholders’ Equity (Deficit) |
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Class A |
Class B |
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Shares |
Amount |
Shares |
Amount |
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Balance as of December 31, 2020 |
$ |
$ |
$ |
$ |
( |
) |
$ |
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Proceeds received in excess of initial fair value of Private Placement Warrants |
— | — | — | — | — | |||||||||||||||||||||||
Remeasurement of Class A common stock to possible redemption |
— | — | — | — | ( |
) | ( |
) | ( |
) | ||||||||||||||||||
Initial fair value adjustment of promissory note |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
Net income |
— | — | — | — | — | |||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Balance as of December 31, 2021 |
$ |
$ |
$ |
$ |
( |
) | $ |
( |
) |
Common Stock |
Additional Paid-In Capital |
Accumulated Deficit |
Total Stockholders’ Equity (Deficit) |
|||||||||||||||||||||||||
Class A |
Class B |
|||||||||||||||||||||||||||
Shares |
Amount |
Shares |
Amount |
|||||||||||||||||||||||||
Balance as of October 16, 2020 (inception) |
$ |
$ |
$ |
$ |
$ |
|||||||||||||||||||||||
Sale of Founder Shares |
— | — | ||||||||||||||||||||||||||
Net loss |
— | — | — | — | — | ( |
) | ( |
) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Balance as of December 31, 2020 |
$ |
$ |
$ |
$ |
( |
) |
$ |
|||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Year Ended December 31, 2021 |
For the Period from October 16, 2020 (inception) to 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 Trust Account |
( |
) | ||||||
Initial fair value adjustment of promissory note |
|
|
|
|
|
|
|
|
Change in fair value of promissory note |
|
|
( |
) |
|
|
|
|
Change in fair value of warrant liabilities |
( |
) | ||||||
Offering costs allocated to warrants |
||||||||
Changes in current assets and current liabilities: |
||||||||
Prepaid expenses |
( |
) | ||||||
Accounts payable and accrued expenses |
( |
) | ||||||
|
|
|
|
|||||
Net cash used in operating activities |
( |
) | ( |
) | ||||
Cash Flows from Investing Activities: |
||||||||
Investment of cash into Trust Account |
( |
) | ||||||
|
|
|
|
|||||
Net cash used in investing activities |
( |
) | ||||||
|
|
|
|
|||||
Cash Flows from Financing Activities: |
||||||||
Proceeds from Initial Public Offering, net of underwriters’ discount |
||||||||
Proceeds from issuance of Private Placement Warrants |
||||||||
Proceeds from promissory note - related party |
||||||||
Repayment of promissory note - related party |
( |
) | ||||||
Payments of offering costs |
( |
) | ( |
) | ||||
Proceeds from issuance of founder shares |
||||||||
|
|
|
|
|||||
Net cash provided by financing activities |
||||||||
|
|
|
|
|||||
Net Change in Cash |
||||||||
Cash — Beginning of period |
||||||||
|
|
|
|
|||||
Cash — End of period |
$ | $ | ||||||
|
|
|
|
|||||
Supplemental Disclosure of Non-cash Financing Activities: |
||||||||
Initial value of Class A common stock subject to possible redemption |
$ | $ | ||||||
|
|
|
|
|||||
Remeasurement to Initial Redemption Value |
$ | $ | ||||||
|
|
|
|
|||||
Initial value of warrant liabilities |
$ | $ |
Gross proceeds from Initial Public Offering |
$ |
|||
Less: |
||||
Ordinary share issuance costs |
( |
) | ||
Proceeds allocated to public warrants |
( |
) | ||
Plus: |
||||
Fair value adjustment of carrying value to redemption value |
||||
|
|
|||
Contingently redeemable ordinary shares |
$ |
|||
|
|
For the Year Ended December 31, 2021 |
From the Period from October 16, 2020 (inception) Through December 31, 2020 |
|||||||
Common stock subject to possible redemption |
||||||||
Numerator: |
||||||||
Net income allocable to Class A common stock subject to possible redemption |
$ | $ | ||||||
Denominator: |
||||||||
Weighted Average Redeemable Class A common stock, Basic and Diluted |
||||||||
|
|
|
|
|||||
Basic and Diluted net income per share, Redeemable Class A common stock |
$ | $ | ||||||
|
|
|
|
|||||
Non-Redeemable Ordinary shares |
||||||||
Numerator: |
||||||||
Net income (loss) allocable to Class B common stock not subject to redemption |
$ | $ | ( |
) | ||||
Denominator: |
||||||||
Weighted Average Non-Redeemable common stock, Basic and Diluted |
||||||||
|
|
|
|
|||||
Basic and diluted net income (loss) per share |
$ | $ | ( |
) | ||||
|
|
|
|
• | in whole and not in part; |
• | at a price of $ |
• | upon not less than |
• | if, and only if, the last sale price of our Class A common stock equals or exceeds $ a period ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant holders. |
• | in whole and not in part; |
• | at a price equal to a number of shares of Class A common stock to be determined by reference to the agreed table set forth in the warrant agreement based on the redemption date and the “fair market value” of the Class A common stock; |
• | upon not less than |
• | if, and only if, the last sale price of our Class A common stock equals or exceeds $ |
• | Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets; |
• | Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and |
• | Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. |
Description: |
Level |
December 31, 2021 |
Level |
December 31, 2020 |
||||||||||||
Assets: |
||||||||||||||||
U.S. Money Market and Treasury Securities Held in Trust Account |
1 |
$ |
$ |
|||||||||||||
Liabilities: |
||||||||||||||||
Warrant liability—Public Warrants |
1 |
$ |
||||||||||||||
Warrant liability—Private Warrants |
3 |
$ |
||||||||||||||
Promissory Note |
3 |
$ |
— |
March 1, 2021 (Initial Measurement) |
December 31, 2021 |
|||||||
Stock price |
$ | $ | ||||||
Strike price |
$ | $ | ||||||
Term (in years) |
||||||||
Volatility |
% | % | ||||||
Risk-free rate |
% | % | ||||||
Dividend yield |
% | % |
Public |
Private Placement |
Warrant Liabilities |
||||||||||
Fair value as of December 31, 2020 |
$ | $ | $ | |||||||||
Initial measurement on March 1, 2021 |
||||||||||||
Change in valuation inputs or other assumptions |
( |
) | ( |
) | ( |
) | ||||||
|
|
|
|
|
|
|||||||
Fair value as of December 31, 2021 |
$ | $ | $ | |||||||||
|
|
|
|
|
|
Inputs |
August 11, 2021 |
December 29 & 31, 2021 |
||||||
Exercise price |
$ |
|
$ |
|
| |||
Volatility |
% |
|
|
|
% | |||
Expected term to warrant expiration |
|
|
|
| ||||
Risk-free-rate |
% |
|
|
|
% | |||
Dividend yield |
% |
|
|
|
% | |||
Stock price |
$ |
|
$ |
|
|
Fair value as of December 31, 2020 |
$ |
|||
Proceeds received through Convertible Promissory Notes |
||||
Change in fair value |
( |
) | ||
|
|
|||
Fair value as of December 31, 2021 |
$ |
|||
|
|
December 31, 2021 |
December 31, 2020 |
|||||||
Deferred tax asset |
|
|
|
| ||||
Organizational costs/Start-up costs |
$ |
|
|
| ||||
Federal net operating loss |
|
|
| |||||
Total deferred tax asset |
|
|
| |||||
Valuation allowance |
( |
) |
|
|
( |
) | ||
|
|
|
|
|
| |||
Deferred tax asset, net of allowance |
$ |
|
|
| ||||
|
|
|
|
|
|
December 31, 2021 |
December 31, 2020 |
|||||||
Federal |
|
|
|
| ||||
Current |
$ |
|
|
| ||||
Deferred |
( |
) | |
|
( |
) | ||
State |
|
|
| |||||
Current |
|
|
| |||||
Deferred |
|
|
| |||||
Change in valuation allowance |
|
|
| |||||
|
|
|
|
|
| |||
Income tax provision |
$ |
|
|
| ||||
|
|
|
|
|
|
December 31, 2021 |
December 31, 2020 |
|||||||
Statutory federal income tax rate |
% |
|
|
% | ||||
State taxes, net of federal tax benefit |
|
|
| |||||
Permanent book/tax differences |
|
|
| |||||
Initial FMV adjustment on promissory note |
|
|
|
% |
|
|
| |
Change in fair value of promissory note |
|
|
( |
% ) |
|
|
| |
Change in fair value of warrants |
( |
%) |
|
|
| |||
Offering cost allocated to warrants |
% |
|
|
| ||||
Change in valuation allowance |
% |
|
|
( |
)% | |||
|
|
|
|
|
| |||
Income tax provision |
|
|
| |||||
|
|
|
|
|
|
Exhibit No. |
Description | |
3.1 |
||
3.2 |
Bylaws. (2) | |
4.1 |
||
4.2 |
||
4.3 |
||
4.4 |
||
4.5 |
||
10.1 |
||
10.2 |
||
10.3 |
||
10.4 |
||
10.5 |
||
10.6 |
||
10.7 |
||
10.8 |
||
10.9 |
||
10.10 |
||
10.11 |
||
10.12 |
||
10.13 |
||
10.14 |
||
10.15 |
||
10.16 |
||
10.17 |
||
10.18 |
||
10.19 |
||
10.20 |
||
10.21 |
||
10.22 |
||
10.23 |
||
10.24 |
||
31.1 |
||
31.2 |
||
32.1 |
||
32.2 |
||
101.INS |
Inline XBRL Instance Document – the XBRL Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document* | |
101.SCH |
Inline XBRL Taxonomy Extension Schema* | |
101.CAL |
Inline XBRL Taxonomy Calculation Linkbase* | |
101.LAB |
Inline XBRL Taxonomy Label Linkbase* | |
101.PRE |
Inline XBRL Taxonomy Extension Presentation* | |
101.DEF |
Inline XBRL Definition Linkbase Document* | |
104 |
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
* |
Filed herewith |
** |
Furnished herewith |
(1) |
Incorporated by reference to the Company’s Form 8-K, filed with the SEC on March 2, 2021. |
(2) |
Incorporated by reference to the Company’s Form S-1, as amended, filed with the SEC on February 5, 2021. |
(3) |
Incorporated by reference to the Company’s Form 8-K, filed with the SEC on March 8, 2021. |
(4) |
Incorporated by reference to the Company’s Form 8-K, filed with the SEC on December 28, 2021. |
April 4, 2022 | Flame Acquisition Corp. | |||||
By: | /s/ James C. Flores | |||||
Name: | James C. Flores | |||||
Title: | Chief Executive Officer, President and Director | |||||
(Principal Executive Officer) |
Name |
Position |
Date | ||
/s/ James C. Flores |
Chief Executive Officer, President and Director | April 4, 2022 | ||
James C. Flores | (Principal Executive Officer) | |||
/s/ Gregory D. Patrinely |
Chief Financial Officer and Secretary | April 4, 2022 | ||
Gregory D. Patrinely | (Principal Financial and Accounting Officer) | |||
/s/ Michael E. Dillard |
Director | April 4, 2022 | ||
Michael E. Dillard | ||||
/s/ Gregory P. Pipkin |
Director | April 4, 2022 | ||
Gregory P. Pipkin | ||||
/s/ Christopher B. Sarofim |
Director | April 4, 2022 | ||
Christopher B. Sarofim |